Editorial: PUC Must Make PG&E Pay for San Bruno Tragedy, Don't Make Ratepayers Pay for PG&E's Sins

February 09, 2017

Mercury News Editorial

As nightmares go, this is a lulu.

Recently convicted felon PG&E and the IRS are putting their heads together to discuss the tax implications of the utility’s $1.6 billion fine.  What could possibly go wrong?

The California Public Utilities Commission went out of its way in April 2015 to shield ratepayers from paying for the record fine imposed on PG&E for causing the San Bruno gas pipeline tragedy. PUC President Michael Picker also made it clear that any effort to take a tax deduction should be disallowed.

The utility has prepared a 27-page letter to the IRS that could thwart those protections, resulting in higher monthly gas bills for PG&E customers.

As state Sen. Jerry Hill notes, hundreds of millions of dollars are at stake for ratepayers.

The utility has a fiduciary responsibility to its shareholders to protect their interests, and the IRS has an equal obligation to enforce its rules regarding tax deductions as fairly as possible. But the notion that ratepayers should pay even part of the penalty for PG&E’s misdeeds remains unconscionable.