Fixing PG&E's blackout problem

State law requires PG&E to pay claims for economic damage caused by system failures
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EDITORIAL The electricity that San Franciscans buy from Pacific Gas and Electric Co. isn't just expensive — it's unreliable. That's what figures from the California Public Utilities Commission show (see "The blackout factor, page 8). In fact, PG&E has more blackouts than any of the public power agencies in the Bay Area.

That has a significant impact on local businesses — but neither City Hall nor the small business community is paying much attention to a multimillion dollar problem.

During the worst days of the California energy crisis, rolling blackouts were a regular event, and the press and public talked constantly about the impact of power outages on businesses and the economy. Now that the worst of that crisis is over, many blackouts get no news media attention at all. But the problem is still serious: reliable power is critical to most business in the Bay Area, and even short-term outages can hit the bottom line.

That's why public power agencies like Silicon Valley Power in Santa Clara and Palo Alto's municipal utility put substantial resources into infrastructure upgrades and repairs. PG&E, which as a private company seeks to keep costs down to fatten profits and reward highly paid executives, has fallen far behind on its system upgrades. That's why, for example, underground explosions keep happening in San Francisco, shorting out power systems and plunging neighborhoods like the Tenderloin into blackouts.

State law requires PG&E to pay claims for economic damage caused by system failures. Restaurants that lose frozen food, for example, can fill out a form, go through a cumbersome process of proving the extent of the losses, and get reimbursed. But PG&E rarely advertises or promotes that program, and lots of small businesses know nothing about it or never manage to file claims.

And even the claim process doesn't cover lost business, lost customers, and the loss of reputation.

State Sen. Mark Leno, who owns a small sign shop (and has suffered from blackouts) has asked the California Public Utilities Commission to investigate PG&E's reliability and mandate that the company meet basic standards for keeping the lights on. But so far, that agency is ducking. Leno has promised legislation if he gets no results from the CPUC, and he should proceed with a bill that would set minimum reliability standards for private utilities and provide significant penalties for failing to meet those targets.

San Francisco needs to take action on the local level, too. The supervisors should hold hearings on electricity reliability and demand that PG&E executives explain the reason system failures are so much higher here than in other Bay Area communities with public power systems. The Small Business Commission should set up (and publicize) a process for filing complaints about PG&E and include information about filing claims in its outreach material.

And as the city continues to wallow in budgetary disaster, city officials (and small business groups) should take note of the lesson here. Public power is not only cheaper — it's more reliable. And that means it's good for business and the San Francisco economy. *

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