Is it PUD o’clock yet?
It appears that Pacific Power, the electric company that serves parts of Portland, as well as other parts of Oregon, California, and Washington, is in dire financial straits. In lawsuits, it's being held legally responsible for damages resulting from wildfires allegedly caused by its downed power lines. The damages could run into the billions of dollars, and the sheer volume of litigation is a potentially crushing burden, even if the utility somehow wins on appeal.
The company, owned indirectly by Warren Buffett these days, is so embarrassed that it's gotten some of the appeal judges to let it black out much of the financial data that it's presented to the court. (Along those lines, here's a document filed with the state public utility commission in early 2024; Pacific had the black magic marker out then, too.) Pacific's credit rating has been dropping, and its "liquidity problems" (you know, the ones most of us have the day before payday) could drive it into a bankruptcy at some point. Jeff Manning, ex-reporter at the O, is now more or less working for the Weed, and he's got a good story here.
The problem is pretty basic. The fires caused a lot of losses of life and property, and the legal system is trying to decide who ultimately suffers financially from those losses. The possibilities, mix and match, are: (a) the shareholders of the power company, (b) its insurance companies, (c) its executives, (d) its rank-and-file employees, (e) its customers, (f) its bankers, (g) the taxpayers, or (h) the fire victims. We're all on that list at least once. (Am I missing anyone?)
Meanwhile, I'm a little surprised that the public power crowd isn't using the crisis as a wedge to have the company's electric operation in Portland taken over by a public utility district. It's been a long time since I've looked at that possibility, but I think it was 20 years ago or so that a group tried and failed to have such a district replace Portland General Electric as the electricity provider in PGE's share of the Portland market. (Pacific and PGE each have a monopoly over part of town.) There was an election on the public power proposal, and it failed. Badly.
As I understand it, a PUD, as its known for short, is a quasi-governmental entity that's a sort of customer co-op; it has no prvate shareholders who need to get paid a return on investment, although it does have bankers who charge interest. Up in Washington State, public power is commonplace, whereas Oregon decided, probably a century ago or more, to make electricity primarily a private, though regulated, business. That said, there are a few electric PUDs in Oregon, discussed here.
Have the PUD proponents in Portland given up on the idea? Do Pacific Power's current woes make this a good time to resurrect the idea? Or do the present problems make this a particularly bad time? To somebody like me, with zero expertise in the area, the concept has at least a superficial appeal. We don't get too many wildfires here in town, and so it might be nice for Portlanders to get out of the liability loop for the disasters that happen out in the woods.
I suspect there are readers who know more about this. Can you help me understand?
Anyway, add the power company to Portland's long and growing list of drama sources. For Pacific, the next year or two are, from all appearances, going to be a mess.
When the lights went out in Canby during the ice storm in 2021, I'd barely been in my new house here for two weeks. Limbs were strewn everywhere, poles were snapped, lines were down. We have a local utility here that takes care of the power. The whole city was restored in under 48-hours. By comparison, my parents lived about ten minutes away in Beavercreek. It took PGE eight days to restore them.
ReplyDeleteCanby buys direct from Bonneville Power via PGE and PP&L. It's fascinating what they've created here over the last 50 years.
The local telephone co-op is one of our other crown jewels. Locally operated and maintained. They even provided cable television for forty years! No need to call another state or another continent to get our issues resolved. During the ice storm, the only light that worked in the house was a little green one telling me my 1 Gbps fiber internet connection was up.
I'm surprised this town hasn't voted to sell all this cool stuff to big corporate interests and blow the windfall on an Amazon tax break. It'll happen soon enough. Until then, living in a city serviced by a customer-owned utility and co-op phone company is pretty sweet.
see dan meek or lloyd marbet for more on the PUD concept.
ReplyDeleteYes, they were prominent among the instigators. Lloyd is probably pushing 80, and Meek’s probably early 70s.
DeleteOregon has one senator who'll be 77 in six months and another who turns 70 next year. Let's not pretend one's advanced age should preclude them from participating in the discourse and charting a course for the next fifty years.
Deletethough it was a huge grassroots pull by untold numbers of oregonians, lloyd marbet’s individual contribution was arguably most responsible for the ballot measure that has prohibited commercial nuclear reactors in oregon in the last 40-odd years.
Deletedan meek went to stanford law, i believe, and may have been a classmate of jack’s?
ReplyDeleteYes, Meek and I were in the same class.
DeleteStrauss v. Belle Realty - NY court of appeals manufactured a “no duty” rule to those who were not in privity with Con Ed (1977 blackout). (Old man fell in stairwell of apartment building fetching water.) That court was concerned about “crushing” liability- used that very term. Court got it wrong, imo. Either the utility / ratepayers pay, the government pays, or we just let the injured folks suffer.
ReplyDeleteBeavercreek and Canby all though close are entirely un-geographically located. Canby sits next the willamentte on the flod plain and Beavecreek sits on lobes of the Boring field. I am guessing that parents living in Beavercreek may have been down one of the hundreds of dead end canyons that are in the Beavercreek area? Lots of steep hills and trees everywhere. That ice storm busted up half of the old oaks in the area [older than 100 years] and I cant recall any big trees in canby that caused day long problems in 2020, my guess is that Canby weathered it completely different than Beavercreek.
ReplyDelete