Martin Hodson reviews California Burning

The fall of Pacific Gas and Electric—and what it means for America’s power grid by Katherine Blunt.

Ever wondered about those fires in California over the last few years? What was behind them? I have a special interest in California, as my brother and his family emigrated there from the UK around a quarter of a century ago, and my two nephews still live there. Fortunately none of my family have come close to the fires, but at times the smoke originating from them was a problem even in the Central Valley where they live.

So when I spotted California Burning, I thought it would be a good opportunity to find out more about this whole topic. The author, Katherine Blunt, writes on renewable energy and utilities for The Wall Street Journal, and is a major authority on this whole area. To write this book she needed to be pretty good on history, law, science, and the energy sector, plus have an eye for detail. There is an incredible amount of detail in this book, maybe a bit too much in places for my taste, but Blunt very skilfully weaves together her tale going back over a century.

The story almost entirely concerns the fate of one company, Pacific Gas and Electric (PG&E), the main provider of both gas and electricity to the northern two thirds of California. The book largely takes a chronological approach going way back to the 1880s when the pioneers of electricity provision first started their work. But it begins with the event in 2018 that will forever be remembered as the most disastrous in the history of the company. On 8th November of that year there were particularly high winds through Northern California. This caused a worn hook which supported a high voltage wire to break, allowing the wire to drop from its hundred year old electricity pylon to the ground. The sparks started a fire at 6.15 a.m. which spread very rapidly, seven miles in an hour. By that time it was on the edge of the town of Paradise with 27,000 residents. Most people managed to evacuate the town, but 85 people died in the inferno. The Camp Fire, as it became known, burned for 17 days destroying 19,000 structures, most of them homes, and ranged over 150,000 acres. During the following investigation it was discovered that the hook that broke cost 56 cents in 1919. But this was not a one-off freak. There were no records of any parts ever being replaced on that pylon. The pylons in the area that were a hundred years old were found to have only been surveyed from the air. Checking each one by inspectors climbing the towers was more time consuming and costly, and essentially cuts in safety checks were the main reason things went wrong for PG&E.

Burned out house in Paradise California following the Camp fire that occured in November 2018
Shutterstock Stock Photo ID: 1517724701. Paradise, CA/ United States- March 1, 2019: Remnants of a burned home in Paradise California after the Camp Fire that occurred in November 2018. (Photo: M Yerman)

So instead of prioritising safety, decisions were made to maximize profits. In effect, Blunt describes a triangle with three poles: cost to the consumer; shareholder dividends; and safety. For long periods PG&E concentrated on keeping the price to the consumer reasonable, while giving large dividends to shareholders. To do that safety work was cut back. This all has a strange resonance with our water companies and sewage pollution in the UK. There were also other factors at work in this story. During the time covered in this book climate change has been clicking in, and it is generally getting hotter and drier in California. Ironically, a big push for renewable energy sources diverted finance away from work to make the grid safe. Of course there have also been other causes of the Californian forest fires besides faulty pylons, but faulty electrical equipment has been a major reason.

One aspect of this type case is that it is difficult to pin the blame on any one individual. So when it enters the legal system as the Camp Fire did, it presents considerable challenges. It was the whole culture of the PG&E organisation over many years that was responsible for the incident and the deaths that followed. But then what? If you find such an organisation guilty you can fine it, but you can’t damage it too much or close it down as the whole economy of a region depends on it functioning. I particularly liked the quote from Lord Chancellor Edward Thurlow in eighteenth-century England, “Corporations have neither bodies to be punished, nor souls to be condemned; they therefore do as they like.”

What now? The current CEO of PG&E, Patti Poppe, has embarked on an ambitious scheme to underground the grid, particularly where it is in danger of causing fires. It is expensive, but she argues it is too expensive not to do this as climate change effects are getting even more marked. Safety now has a much higher priority for PG&E.

I have only been able to give a brief overview of what is a pretty dense book. If you are interested in how the energy sector operates this book gives you a good idea. If you want an example of where business ethics failed on a grand scale this certainly is one. It is not a light or an easy read, but it is a very good book of its type and I recommend it.

Blunt, Katherine (2022) California Burning: The fall of Pacific Gas and Electric—and what it means for America’s power grid. Portfolio/Penguin: New York.

Dr Martin Hodson (CRES Principal Tutor)