Contra Costa Times
WALNUT CREEK, Calif.: Skirmishing continued Thursday in the protracted battle over how to reorganize PG&E Corp.’s bankrupt utility unit. A consumer advocacy group challenged a state-sponsored plan to tap electricity users to pay debts, and a judge approved the wording of a PG&E mailing to creditors.
At issue is how to pay a $14 billion stack of bills the utility accumulated during the California energy crisis. PG&E wants to break itself into separate companies and end the state’s power to set rates for its hydroelectric dams and the Diablo Canyon nuclear plant.
The state Public Utilities Commission wants to keep PG&E intact and pay creditors by keeping utility rates above the cost of producing power. The PUC faces an April 15 deadline to spell out details of its plan in bankruptcy court.
With that deadline looming, on Thursday the Foundation for Taxpayer and Consumer Rights of Santa Monica asked the state Supreme Court to prevent the PUC from spending taxpayers’ money promoting any plan that would hike electricity rates or prevent a refund to consumers. It also challenged the PUC‘s bankruptcy discussions in non-public sessions.
Gary Cohen, the PUC‘s top lawyer, said in a release that the foundation’s lawsuit “lacks merit” and would mainly boost PG&E‘s plan. He said the PUC planned to discuss its plan in a public session April 22.
The foundation lawsuit followed an earlier challenge to a PUC lawsuit settlement that allowed Southern California Edison to pay creditors with revenue from electricity users. That challenge was rejected by a federal judge, but the foundation has appealed.
Also Thursday, U.S. Bankruptcy Judge Dennis Montali tentatively approved the wording of a disclosure statement that PG&E must send to its creditors who will vote on its bankruptcy plan. That action was a “significant milestone in the utility’s continued progress through the bankruptcy process,” PG&E said in a release. Montali has set a June 17 target to mail disclosure statements from PG&E and the PUC to creditors.