Pacific Gas and Electric Company (PG&E) is the utility that provides natural gas and electricity to most of Northern California. The southern part of the state is generally served by Southern California Edison for power and natural gas from Southern California Gas. PG&E was founded in 1905, and is currently headquartered in San Francisco.
In 1993, PG&E was found guilty in a scandal of contamination of drinking water with toxic hexavalent chromium in the southern California town of Hinkley. The case was settled in 1996 for $333 million, the largest settlement ever paid in a direct-action lawsuit in U.S. history. The 2000 movie Erin Brockovich dramatized this event.
In the later 1990s, under electricity market deregulation this utility sold off most of its power plants, because the executives felt that is was more profitable to sell the plants at a premium and then buy power from the Independent System Operator (ISO). This had the effect of requiring the utility to buy power from the energy generators at fluctuating prices, while being forced to sell the power to consumers at a fixed cost. However, the market for electricity was dominated by the Enron Corporation, which, with help from other corporations, artificially pushed prices for electricity ever higher. This led to the California electricity crisis that began in 2000.
With a critical power shortage, rolling blackouts began on January 17 2001. With no generating capacity of its own, and unable to sell electricity to consumers for more than it could buy it on the open market, PG&E was forced to enter bankruptcy April 6, 2001. The State of California bailed out the utility, but this act for all intents and purposes bankrupted the state government. This played no small part in the eventual recall of California Governor Gray Davis.
PG&E emerged from bankruptcy in April 2004, after distributing $10.2 billion to hundreds of creditors. Its 4.8 million electricity customers are expected to pay an average $1,300 to $1,700 each in above-market prices through 2012.
Diversity
PG&E received a 100% rating on the Corporate Equality Index released by the Human Rights Campaign starting in 2003, the second year of the report.
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Last updated: 06-02-2005 11:04:17
