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PG & E declaring bankruptcy.
April 6, 2001 10:57 AM   Subscribe

PG & E declaring bankruptcy. So if every website in the bay area goes down, it may not be due to the dotcom fallout. And remember kids, when the lights go off, you'll want to loot your local Fry's before anything else.
posted by mathowie (40 comments total)

 
Hmm.. I bet it was that Erin Brockovich that brought the whole thing down. That's really odd, a utility filing bankruptcy, does that happen often? And why Fry's?
posted by tiaka at 11:02 AM on April 6, 2001


Fry's is a geek paradise.
posted by mathowie at 11:20 AM on April 6, 2001


Being out East, I have a question - is PG&E a power generator or just a distributor? Because from what I've gathered from NPR reports, there *IS* no power shortage, just money-hungry power generators that are fucking over the energy distributors by having so high rates...and that Bush refuses to step in and kill deregulation because he thinks the generators should be allowed to make as much as they're charging....

Can someone tell me if I'm right?
posted by bkdelong at 11:22 AM on April 6, 2001


...that up to no good, lookin' where she's not supposed to, nosing into other peoples business Erin Brockovich!
posted by the_ill_gino at 11:25 AM on April 6, 2001


What I wasn't aware of was that there was a parent corporation PG&E with the utility PG&E as a subsidiary. What else do they own? When the lights go out, I'm planning a curbside propane coffee service setup. Starbucks is NOTHING without electricity! heh heh heh heh... I'll squeeze those last few dotcom bucks out of the caffeine addicted. :-)
posted by girlhacker at 11:26 AM on April 6, 2001


Hmm... Geek's paradise? Must be a type of west coast thing, I have yet to see one. Chicago sucks at times, not that I could afford much of geek-wear, a lot of it costs too much... damn it! Why couldn't Illinois have blackouts? I'd atleast loot best buy.
posted by tiaka at 11:31 AM on April 6, 2001


Bkdelong, you're right. PG&E is just a distributor now. The phrase on the top of my bills is "We Deliver Energy." It seems that they really screwed themselves once CA began deregulation by selling off all their plants and generators and focusing solely on transmission.

And, as has been pointed out before, California is not using any more power now than anytime in the last few years, and ranks 48th in per-capita energy consumption by state. Is this a 'generated' crisis? (I just kill myself) The more I hear about this, the more I think so.
posted by OneBallJay at 11:36 AM on April 6, 2001


Where else can you buy Red Vines, Ethernet cables, and pornography in the same store but Fry's? At least when looting, you won't have to deal with their horrendous customer service or wait in the Disneyland-length checkout lines.

As far as deregulation goes, there is no shortage of electricity. Just a shortage of ethics. As I see it, there's a very small group of unscrupulous power generators that are artificially limiting the supply of energy in order to command disgustingly high rates.

The federal government could step in and place limits on the wholesale costs, but that just doesn't sound like something the Bush administration is likely to do.
posted by waxpancake at 11:42 AM on April 6, 2001


From what I've read in various sources (which will now go unattributed in a mishmash of the following information), PG&E Co. (the ones filing for Chapter 11) is owned by PG&E Corp., who supposedly has something like $30 billion in the bank. PG&E is paying people not to produce energy in parts of the state because they can't handle the incoming power (see previous MeFi thread). They've failed to invest in alternative sources of energy or in the construction of new plants.

PG&E's gotten themselves in a heap of trouble and the citizens of California, and other western states, are bearing the brunt of their colossal mis-management. Bush's failure to assist the state during the crisis demonstrates his apparent belief in "state's rights" and his willingness to pander to big business at the expense of the individual.

There are some interesting articles about how much money some people in Texas have made off the whole stink, I'll see if I can dig them up.
posted by megnut at 11:56 AM on April 6, 2001


Everyone should be aware that "declaring bankruptcy," which almost always means Chapter 11 for a company, doesn't mean it's going out of business. Lots of companies operate during Chapter 11 and want to because of the protection it affords against various creditors. Given the uncertain situation concerning power in California, there would seem little reason for PG&E not to file for Chapter 11: it buys them time to sort things out.
posted by ParisParamus at 12:01 PM on April 6, 2001


If ya don't mind the self-bloggage, I documented several links awhile back on how San Francisco has been screwing its citizens out of a federal mandated energy cooperative for, oh, about a hundred years. It's among the worst scandals I've ever heard of. So if your lights do go out, make sure you blame your politicians.
posted by norm at 12:05 PM on April 6, 2001


Can anyone explain to me how it is that the California power crisis is unfolding in winter and early spring? If there's a crisis now, what happens in August, or even June, when a large chunk of the population will have its A/C running? Seems like a full-fledged disaster is a month or two away, no?
posted by ParisParamus at 12:13 PM on April 6, 2001


yes.
posted by captaincursor at 12:24 PM on April 6, 2001


Here's a link to an article on MSNBC that details the differences in California's failed and Pennsylvania's successful electricity deregulation efforts.
posted by CRS at 12:30 PM on April 6, 2001


Where else can you buy Red Vines, Ethernet cables, and pornography in the same store but Fry's?

Don't forget the personal hygiene items by the checkouts, conveniently placed to remind said geeks to wash occasionally.
posted by holgate at 12:35 PM on April 6, 2001


Because from what I've gathered from NPR reports...

Must...not...say...it....

there *IS* no power shortage, just money-hungry power generators that are fucking over the energy distributors by having so high rates...

This is wrong. California doesn't have the power because every attempt to build major power plants there in the last ten years has been foiled by environmentalists, during the same period their population has skyrocketed and their computer industries have grown exponentially. Then they created a so-called deregulation plan that put price controls on the buying and selling of power, forcing utlities like PG&E to have to buy all their excess power needs on the spot market, the single most expensive place to go. And since those same price controls prevent the utilities from passing those higher spot costs on to customers, you get a utility (or a state) that literally can't afford to buy the needed extra power. THAT is why you have a power shortage out there. NPR's argument only makes sense if you believe the entire power system ought to be immediately nationalized so that those nasty capitalists can't make their evil profits off their work.

And even THEN you'd still have real shortages. Back during the height of this mess a couple months ago, there was much grumbling up in the Northwest statesabout them having to send power to California when they were starting to run low themselves, and they made it clear that if and when things
truly got tight, they were going to produce for themselves first, and California second.

And you only need look at any given second- or third-world nation to see how effective nationalized and/or socialist power systems are. I suppose it would more fairly spread out the blackouts across the entire nation, far more often...

and that Bush refuses to step in and kill deregulation because he thinks the generators should be allowed to make as much as they're charging....

I'm not sure what this is supposed to mean. The only thing he's doing different from Clinton is refusing to force out-of-state companies to send power to California when they have a legitimate worry that they'll never get paid for it, no matter how high or low their prices are. Does he even have the power (heh) to unilaterally nullify California state law?

Can anyone explain to me how it is that the California power crisis is unfolding in winter and early spring?

Well, those rolling blackouts from a week or so ago happened because the temperatures in SoCal were ~85-90°, which were unusually high for that time of year.
posted by aaron at 12:44 PM on April 6, 2001



Two things, aaron:

1. The power shortage is as much from PG&E cutting their production too close to the margin (based on faulty supply predictions) as from unpredictably high usage. Usage has been consistent in CA over the past few years.

2. The guff about those darn environmentalists blocking new plants is, well, guff. (Yes, the link is from the Sierra Club, but if what they're laying out is true . . .)
posted by feckless at 12:59 PM on April 6, 2001


megnut writes:
There are some interesting articles about how much money some people in Texas have made off the whole stink, I'll see if I can dig them up.

megnut, I would love to see those links. I really would like to find documentation about this aspect of the crisis, so that I can back up my long-held suspicions when I voice them to people around me who don't want to believe me.

We are installing solar panels on our roof to generate some of the power we need (in fact, they are being deliverd as I write this)... hoping to have the meter run backwards in the summer! Of course, this is not exactly an economical solution (those things cost and arm and a leg), but, in a way, makes us feel less part of the problem and more part of the solution.
posted by poorhouse at 1:07 PM on April 6, 2001


"Well, those rolling blackouts from a week or so ago happened because the temperatures in SoCal were ~85-90°, which were unusually high for that time of year."

Just to forcast disaster a bit more precisely, isn't the LA area self-contained/sufficient re power (they have non-private generation/distribution)? Assuming yes, how much of the State's population experienced 85-90 degree temperatures? In otherwords, the "best is yet to come." Or, will there no problem at all, because the whole thing is being aritificially created, and California isn't using any more power than it did last year?

"And you only need look at any given second- or third-world nation to see how effective nationalized and/or socialist power systems are."

Um, Aaron Nice straw man. Who's proposing socialism? What was wrong with what California had until recently? Not lucrative enough for certain Texans? And save the cost, which is largely a function of higher energy costs and their systems of taxation systems, what about all those third-world power grids in Western Europe which work pretty well.
posted by ParisParamus at 1:07 PM on April 6, 2001


As I understand the PG&E that's filing for bankruptcy is primarily a distributor. However, their parent company is a generator. So the parent company is making lots of money but the distribution company is going broke and sucking up our money. As you can imagine this doesn't make us (consumers and state tax payers) eager to bail them out.
posted by rdr at 1:10 PM on April 6, 2001


It's not the link about how much money they've made, but here's a little list of polluters that gave mucho dinero to the Bush campaign. It's no wonder that the Bush administration position just happens to perfectly jibe with the interests of said polluters/power producers.
posted by norm at 1:17 PM on April 6, 2001


This bankruptcy filing will hopefully create more public awareness in the difference (and existence!) of the parent PG&E versus the utility that filed Ch11. I was not aware of the parent, but I didn't go looking for it, mostly read the filtered news about the crisis. I'll pay more attention to that now and have more understanding towards the arguments I keep hearing that "PG&E has lots of money!!"
posted by girlhacker at 1:28 PM on April 6, 2001


We are installing solar panels on our roof to generate some of the power we need
Poorhouse, you rule! It is my great home to start a wind farm someday. How much does it cost to set yourself up like you are planning? (if that is not too personal)
posted by thirteen at 1:35 PM on April 6, 2001


great hope...
posted by thirteen at 1:37 PM on April 6, 2001


Um, Aaron Nice straw man. Who's proposing socialism? What was wrong with what California had until recently? Not lucrative enough for certain Texans?

You accuse me of bringing up a straw man, and then respond with a straw man? I don't know that anything was inherently wrong with what California had until the "deregulation" bill, in terms of their price control disaster. California's terminal case of NIMBY/BANANAism is largely unrelated to that, however, and their current lack of electrical self-sufficiency would have come about regardless. Which would have resulted in some amount of higher energy prices, regardless.

And save the cost, which is largely a function of higher energy costs and their systems of taxation systems, what about all those third-world power grids in Western Europe which work pretty well.

Third-world grids in Western Europe? Huh?

(Yes, the link is from the Sierra Club, but if what they're laying out is true . . .)

More like half-truths, which aren't much better than falsehoods. What the Sierra Club says about the Sierra Club is probably true. But then they try to falsely equate the Sierra Club with "environmental groups." They may be an environmental group, but all environmental groups are not them. And plenty of other groups and individuals have blocked everything for all sorts of different reasons. (If I recall correctly, that plant they mention was blocked by Cisco because Cisco didn't want a big eyesore next to their swanky new campus. That's just as pathetic as all the other reasons, though it begs the question: If not there, why no plant at all anywhere else?)

And it's nice that the SC supports more-efficient natural gas plants. But they're still natural gas plants, which means they'd be just as caught up in the supply-and-demand cycle as the current plants. And the ad doesn't say anything about the ancillary questions: If these plants had been built, would the more outmoded plants have been allowed to continue production, or would they have been forced to shut down? How much opposition to these plants was there from anyone other than the Sierra Club and other power companies, and how long would this opposition have been able to prevent the plants being built? The ad says the plants would have provided power to 1.2 million homes. Would all that power have gone to homes? Wouldn't much of it have been eaten up by the huge power-hungry computer economy expansion in the state since the proposals were made in 1995? Etc.
posted by aaron at 2:16 PM on April 6, 2001



thirteen: I'm not really into alt-power stuff, but passing curiosity led me to Home Power magazine a while back. Looks to be a good starting point for that sort of thing; one current article is about a guy who rigged his home for wind and solar on the cheap.
posted by harmful at 2:19 PM on April 6, 2001


thirteen: I'm not really into alt-power stuff, but passing curiosity led me to Home Power magazine a while back. Looks to be a good starting point for that sort of thing; one current article is about a guy who rigged his home for wind and solar on the cheap.
posted by harmful at 2:19 PM on April 6, 2001


Why California's Restructuring Failed: The restructuring process in California was very complicated. Stripped to the essentials, it forced utilities to divest themselves of their generating plants and required that all electricity be traded a day ahead in the power exchange. Designers of the system were so confident it would produce lower prices that the rates to residential consumers were reduced in the legislation by 10 percent. In essence, the real option, as it is called by economists, was eliminated, and all transactions were forced into the spot market.

Living solely in the spot market can appear to be a sound money-saving strategy--as can driving without insurance or entering a winter without having made snow removal arrangements in advance. It costs a little less during the off-peak periods. But when the peak period or the accident or the blizzard comes, there is no protection from skyrocketing prices.

posted by Mick at 2:21 PM on April 6, 2001


California sent all their electoral votes to the Gore camp, and by an overwhelming popular majority. Not much incentive for the Bush Administration to help y'all out.

As an aside, to those looking at Texas for raking in profits on California's back — the chemical company that employs me does its own power cogeneration to operate our plant reactors on the Gulf Coast. They have been selling excess power to California to the tune of a million dollars per week. Nice little sideline.
posted by netbros at 2:31 PM on April 6, 2001


I'll note again that if PG&E had paid off the "stranded cost recovery" bonds as quickly as SDG&E did, they could have tripled their rates (as SDG&E did) and they wouldn't be in this situation. The stranded cost recovery thing was a boondoggle that was pushed for by the power companies, and I can't believe that the PG&E management was as shortsighted as they were. But yes, it's apparent in retrospect that everyone who criticized the deregulation plan -- on both the right and the left -- was absolutely correct. It's an ill-thought-out mess. Suggesting that utilities be allowed to triple their rates (or that taxpayers bail out the utilities again) isn't going to win any friends from the voters; suggesting that the management of PG&E made their bed and should now sleep in it is going to cause the generators, rightfully, to get verrry, verrry nervous about selling power in California.

Wouldn't much of it have been eaten up by the huge power-hungry computer economy expansion in the state since the proposals were made in 1995?

Aaron, although I think you're entirely right about the NIMBYism in California (particularly as regarding natural gas generation, which is environmentally the best large-scale solution currently available), I'm just not convinced that the 14% total growth in power consumption since 1990 is the root cause; look at the drop-off in utility power production, which actually peaked in 1994.
posted by snarkout at 2:43 PM on April 6, 2001


Aaron: my point was that plenty of state-owned electric utilities work well throughout the world. They're not perfect, but it's kind of crazy to suggest, as you seem to, that it's either privitization or Chernobyl. Actually I suspect privitization is a bill of goods: Electric grids are more like water companies than telephone companies, and I just don't see how competition would ever work.
posted by ParisParamus at 2:44 PM on April 6, 2001


Of course, this is not exactly an economical solution (those things cost and arm and a leg), but, in a way, makes us feel less part of the problem and more part of the solution.

Wait until fuel cells start becoming available on a large scale, which will start to happen as soon as the end of this year. When people start putting those puppies in their basements, it's going to turn the whole power economy upside down, in a good way. I read one study that said by the end of the decade, the average household will be regularly selling power back onto the grid during the daytime.
posted by aaron at 2:50 PM on April 6, 2001



More like half-truths, which aren't much better than falsehoods. What the Sierra Club says about the Sierra Club is probably true. But then they try to falsely equate the Sierra Club with "environmental groups." They may be an environmental group, but all environmental groups are not them. And plenty of other groups and individuals have blocked everything for all sorts of different reasons.

Well yeah, sure, you can find groups that'll protest anything in their backyard. But Sierra is a pretty mainstream environmental group, and more influential than many. The point I found interesting was that the utility companies had also blocked new plants. As long as we allow it to be profitable to pollute, we won't see private companies rushing to stop.
posted by feckless at 2:59 PM on April 6, 2001


Thanks for the links Harmful, great reading. I cannot believe how cheaply the family in the second link was able to put things together.
In Chicago, there is a plan to give incentive to create rooftop gardens on all the buildings to deflect heat, and lower energy consumption in the summer. While I am not much for coercion, the city already requires new buildings to have a certain amount of internal parking available, there is no reason why these buildings should not try and harness some of the free power that is available, even if it just manages to garner enough to keep the buildings lit at night when nobody is in them.
posted by thirteen at 3:33 PM on April 6, 2001


I read one study that said by the end of the decade, the average household will be regularly selling power back onto the grid during the daytime.

aaron, our small-scale solar rig will be generating sufficient power in the summer (according to the vendor and our calculations) that we will be selling power back to PG&E. We are also getting a rebate on the installation ... but still, this is not something most people can do now -- both for economical reasons, and for lack of adequate sun. But, as you pointed out, if more people start "putting those puppies in their basements," yes, the price will go down, and, eventually, it could have a major impact on this whole mess.

All these years, it bothered me that we got sun all day where I live; now I can use this to our advantage...
posted by poorhouse at 3:33 PM on April 6, 2001


Does [Bush] even have the power (heh) to unilaterally nullify California state law?

If he can make an even *reasonable* case that there is a National Security Interest involved, the President of the United States can do pretty much any damn thing he wishes.

It's fiction, but the topic is covered pretty well in the "shut down the country" cabinet meeting in Clancy's Exeutive Orders. The prez (such as he is) does in fact have a lawyer hanging around to advise him on the legalities, but teh fact is that he can do it now, and let the laywers sort it out later. And if he's the only who *does* think it's that important, the chief physician of the Presidential Detail can declare on him, and it goes to Cheney.
posted by baylink at 6:43 PM on April 6, 2001


I think it is god's wrath. I know little about the energy crisis but I do know to declare bankruptcy is a badge of honor from which you bounce back in better shape, unlike personal bankruptcy, which the GOP has now made a waste product so that ordinary citizens end up (here I get technical) "screwed."
Can't we get energy sent here from China, like black berets and running shoes and lord knows what not?
posted by Postroad at 6:50 PM on April 6, 2001


'Scuse me, but if the power's out, what good would any of the stuff at Fry's do for you? It all needs juice to work.

(wish we had Fry's in New England....do they exist outside of California at all?)
posted by briank at 6:51 PM on April 6, 2001


Porn doesn't need juice to work, just sunlight. Deoderant only needs body heat. Water only needs a throat. Well, maybe a stomach, too.

Besides, it isn't as though the power outage would be in any way permanent. Are you kidding? California, the home of Hollywood and Silicon Valley shuts down and you think it'll stay that way for long?

A couple of hours with no security cameras (figure your average store security system has what, 8 hours of drain time on their video camera UPSes?) at fry's could mean a whole lot more energy drain when the power grid comes back up.
posted by cCranium at 8:40 PM on April 6, 2001


Here is a sourced explanation of the power crisis, and responses to allegations on both sides of the issue.
posted by owillis at 8:52 PM on April 6, 2001


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