PG&E, the utility company that last week reintroduced one third of San Franciscans to the Dickensian joys of wearing coats indoors and tabulating the losses of spoiled food by candlelight, is not popular. Last night, in a move that would be on the nose if you could locate your face in the dark, a planned power outage was rudely preceded by an unplanned power outage.
If PG&E executives were visited by three ghosts on Christmas Eve, it wouldn’t have been a shock: In the last two decades and change, the utility company has blown up a quaint Peninsula town, triggered some of California’s most lethal and destructive wildfires, entered into a pair of bankruptcies, been convicted of multiple felonies and has been accused by a federal judge of engaging in a “crime spree” while acting as a “continuing menace to California.”
PG&E was once a City Hall darling: 14 years ago Mayor Ed Lee blithely described it as a “great company that gets it.” Nobody’s talking like that anymore. Beating up on the monopolistic utility is now great politics: If the energy generated by local politicians gnashing their teeth and shaking their fists could be harnessed and shunted into the city’s power lines, San Francisco would be well on its way to opening up a municipal utility.
And you know what? We may yet do that. Whether PG&E likes it or not.
In 2019, the city offered PG&E $2.5 billion to buy up those parts of the company’s electrical infrastructure serving San Francisco (not the gas infrastructure, though — the city wasn’t interested in that) in a bid to become one of several municipal utilities across the state. The offer was quickly rebuffed.
But the city’s plan was still afoot. It followed up in July 2021 by filing a petition with the California Public Utilities Commission “For a valuation of certain Pacific Gas & Electric company property pursuant to Public Utilities Code Section 1401-1421.”
In September of 2025, after four years and more than 130 legal filings, an administrative law judge issued a decision regarding how to even begin “establishing methods and standards” to evaluate the cost of buying out PG&E. In other words: Nine years after PG&E spurned the city’s offer, and four years after San Francisco’s formal petition, the parties are ready to negotiate about the shape of the negotiating table.
Electricity moves through the wires at close to the speed of light. The legal process of buying out the monopolistic provider of that electricity is glacial.
Last week’s multi-day blackout, which was purportedly caused by yet another PG&E substation fire, was a convenient reminder of why elected officials and their constituents alike are fed up with the utility. Buying it out and municipalizing power, once the raison d’être and white whale of the San Francisco Bay Guardian, is now mainstream city policy — and has been for years.
“Right now, literally and figuratively,” says Susan Leal, the former general manager of the San Francisco Public Utilities Commission, “this should be a fire sale.”
It is unlikely that there will be an immediate purchase of smoke-damaged electric infrastructure in San Francisco’s future. The sclerotic pace of the legal process all but guarantees that. Even once the appraisal process is complete, PG&E could well turn down the city’s much more exhaustively researched and documented offer.
And here’s where things get interesting. Nobody in city government will comment on the record, but it is also lost on nobody that an environmental impact report and a fair appraisal — both of which the city has been plodding its way through the process of obtaining — are precursors to eminent domain.
So, yes: We may be witnessing the early stages of a literal power grab.
If PG&E harbored hopes of turning back the clock and getting back into the good graces of this city’s mayor and board of supervisors, last week’s blackout didn’t help at all. The company’s rapport with the city has, in fact, been dimming for quite a while. When former city controller Ed Harrington left the city’s public utilities commission in 1991, he said, the city and PG&E got along just peachy By the time he returned to the PUC in 2008 to become its general manager, “it was war.”
What happened? In 2008, the San Bruno explosion and the worst of the wildfires were yet to come. But things had changed: The deregulation crisis of the early 2000s actually wasn’t PG&E’s fault — but it did drive the utility into bankruptcy. And, when it emerged from bankruptcy, “to deal with the large amount of debt it incurred, [PG&E] really was intent on reestablishing itself with Wall Street and regaining the goodwill of shareholders,” said Katherine Blunt, the author of “California Burning: The Fall of Pacific Gas And Electric — And What It Means for America’s Power Grid” in a 2022 radio interview.
“At that point, you begin to see an effort in which earnings growth is really a priority. To achieve that, it cut expenses. That turned out to be the wrong choice. The cuts were such that safety was compromised.”
For example, Blunt wrote that the small metal hook on a PG&E power tower that sparked the 2018 Camp Fire, the most destructive wildfire in state history, was forged shortly after World War I, cost 59 cents, and had not been replaced for nearly 100 years.
This, for San Francisco’s modern-day proponents of public power, is an argument for a public utility, instead of a regulated monopoly like PG&E. A municipal utility doesn’t need to curry favor with Wall Street or placate shareholders. Maintenance, at least in theory, would be a virtue — instead of a drain on earnings growth.
PG&E’s overt disasters have strengthened the city’s argument. But, in recent decades, the city and PG&E have had a series of more under-the-radar disagreements. The Public Utilities Commission has, since 2018, documented and sent to the Board of Supervisors instances of what it describes as “PG&E obstruction of local projects.” Lengthy waits for electricity hook-ups, the city claims, have added more than $20 million to costs on city projects — which were already slow and costly.
This is not just a San Francisco grievance. In the wake of the blackout, Sen. Scott Wiener announced that he would once again introduce legislation to create “a clear, statutory pathway” for local governments to decouple from PG&E and form municipal utilities. Colleagues as far off as Kern County, Wiener said, have told him that lethargic PG&E electric hookup timetables have led businesses to leave the state.
More than one observer has compared the city’s overtures regarding PG&E to a divorce. Fittingly, the estranged parties are fighting over everything. In 2023, the San Francisco-born utility and San Francisco even did battle before the Federal Energy Regulatory Committee and at the Washington, D.C. circuit court regarding city efforts to provide more power to San Franciscans using PG&E’s power grid.
Every move, no matter how minor, will be contested and PG&E won’t give up its monopoly without a fight. It’s far more efficient for PG&E to provide power to city dwellers like those in San Francisco — who are literally stacked atop one another — than in more spread-out parts of the state. Any steps from this or any city to secede will be challenged with great vengeance and furious anger.
All of which is to say: This will not be pretty. This will not be easy. This will not be quick.
In November 2008, the voters of San Francisco were given the opportunity to approve a ballot measure that would municipalize city electric service.
The political message from PG&E and its allies to voters then was a simple one. Do you want to spend billions of taxpayer dollars so the people in charge of keeping San Francisco functional can now run your electricity company? More than 61 percent said hell no.
That tack probably won’t fly now. San Francisco voters may not be aware of the increasingly acrimonious relationship between this city’s powers-that-be and its power provider. But they have heard of San Bruno and those wildfires, as their electrical bills, for the most part, inched steadily higher. One-third of us did sit in the dark last week with perhaps even more missing out on Christmas shopping at the worst possible time.
The choice between PG&E and the city isn’t so lopsided anymore, and the coming years could be interesting. Perhaps San Francisco’s future relationship with PG&E will be incendiary in more ways than one.