Warren Buffett Is Not the Answer to California's Energy Grid Problems
For the fourth time this month, Pacific Gas and Electric has purposefully cut power, this time to 2.8 million Northern California residents. As wildfires threaten the region, some will remain without electricity until at least Wednesday. While rolling blackouts have recently become de rigueur for PG&E ratepayers, this latest round, which affects some 7 percent of California’s population, is historic in scale.
Mounting outrage toward PG&E and its inadequate response to the escalating wildfire risks in the state have prompted a number of responses. Both the cities of San Francisco and San Jose have offered to buy the company’s power lines within their jurisdictions, and convert the operation to public ownership. Representative Ro Khanna has publicly called on Governor Gavin Newsom to make a push to convert the company’s holdings within the state from shareholder to municipal ownership. “I’m calling on Gov. Newsom to support turning PG&E into a customer owned utility. We need to have more municipal public utilities providing energy,” he said in a statement Tuesday.
But Newsom has other ideas. On Saturday, as the blackouts commenced, the governor called not for a public takeover, but for Warren Buffett’s Berkshire Hathaway to purchase PG&E, whose share price has fallen to $5 after regulators were informed last week that one of its transmission lines malfunctioned near the site of a fire in Geyserville, California.
The logic behind such a suggestion is simple: Berkshire Hathaway Energy, the conglomerate’s energy arm, is heavily invested in utility companies all over the country. Already in California they own multiple solar farms, including one in San Luis Obispo that is among the world’s largest. Per Newsom’s thinking, the company’s reputation for investing in green energy, combined with its deep pockets (compared to bankruptcy-addled PG&E) would make it a preferable steward of the state’s harried electric grid. Plus, Berkshire Hathaway Energy is privately held, which means that PG&E’s lines would no longer be subject to loathed shareholder ownership.
Read more: https://prospect.org/environment/warren-buffett-is-not-the-answer-to-californias-energy-grid-problems/
(American Prospect)
