San Jose to propose turning PG&E into customer-owned utility

SAN JOSE, Calif. (KGO) -- Amid the on-going threat of blackouts, officials in the Bay Area's largest city are looking at reducing the public's dependence on PG&E. Mayor Sam Liccardo's proposal could turn the company into the country's largest customer-owned utility.

"We need to align the financial interest of PG&E with the public interest," said Liccardo, following a city council rules committee meeting Wednesday afternoon.

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The mayor's buyout proposal, which will be presented to the California Public Utilities Commission, would strip PG&E of its status as an investor-owned company and turn it into a nonprofit customer-owned cooperative.

"Customer-owned utilities don't have to pay federal taxes, they don't have to pay shareholder dividends, they can access capital at much lower costs and that is going to be critical for us in the years ahead, given the extraordinary investment that we'll need in the system," Liccardo added.

In a statement, PG&E told ABC7 News that its energy facilities aren't for sale, nor have they seen the mayor's proposal: "We remain focused on the safety of our customers and communities and will continue working together with our state and local government partners and across all sectors and disciplines to develop comprehensive, long-term safety and energy solutions for the future."

Councilmember Johnny Khamis is open to exploring the proposal, but has some concerns about the potential cost.

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"I can't imagine how many billions of dollars it would take to buy an outdated system," said Khamis. "If we're going to make a proposal to PG&E, what are we going to get for it and will it really stop the power outages?"

The city council will consider the mayor's full proposal in mid-November. It also looks at creating a city-owned utility to develop independent power systems such as microgrids to protect the city from future shutdowns.

For the latest stories about PG&E's Public Safety Power Shutoff go here.