SAN JOSE, Calif. (KGO) -- Another idea has surfaced for how to save PG&E while giving customers safe, reliable service. A coalition of mayors and county supervisors has written a letter to the California Public Utilities Commission to consider making PG&E a "customer-owned utility."
The idea has a lot of moving parts, but it boils down to this-- buying out existing PG&E shareholders with bond money that customers will pay off over time in their monthly utility bills.
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"If you're going to be paying for it (the PG&E bankruptcy) in higher rates, we'd better own the company," said Liccardo. "That's the approach I'm advocating."
He doesn't know how much it will cost, although one estimate has surfaced, suggesting $50 billion in bonds might have to be sold.
Liccardo and 21 other mayors, along with five county supervisors, signed the letter to the CPUC. Support has come from as far north as Redding and as far south as San Luis Obispo. The hope is that it will be considered as part of the PG&E bankruptcy proceedings.
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A customer-owned utility has certain advantages that PG&E does not enjoy, according to Liccardo, freeing up capital to do maintenance and safety improvements to the power grid.
"A customer-owned utility is not required to pay dividends to shareholders," said Liccardo. "It's exempt from federal taxation. It may be exempt from other taxes as well, and that enables it to focus its scarce dollars on badly needed capital upgrades."
Two hurdles would have to be overcome. First, private hedge funds have indicated interest in buying PG&E. Second, PG&E says its facilities are not for sale.
In a statement, PG&E said it's "...convinced that a government or customer takeover is not the optimal solution that will address the challenges and serve the long-run interests of all customers in the communities we serve."
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It argued that changing the structure of the company would not create a safer operation.
The consumer advocacy group TURN, which has been a strong critic of PG&E, said it hasn't studied the Mayors' proposal but would welcome a plan that puts customers first.
22 mayors, including San Jose's, pushing to make PG&E customer owned
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