Outrage Over 'Cozy' Correspondence Between CPUC, PG&E

By Garance Burke
Associated Press

California's top utility regulators communicated often and enthusiastically with executives at PG&E, even offering unsolicited advice on handling the media while they presided over a case to decide how much the company should pay for the deadly September 2010 natural gas pipeline blast in San Bruno, according to a trove of emails released Monday.

The 7,000 pages of emails between leaders at PG&E and California Public Utilities Commission President Michael Peevey and his staff were released as the result of a lawsuit filed by the city of San Bruno.

The commission is responsible for punishing PG&E in the wake of the explosion that killed eight people, injured dozens and laid waste to a suburban neighborhood — a disaster federal investigators say could have been averted.

In an April message from Peevey to Brian Cherry, PG&E's vice president of regulatory relations, Peevey offered the executive advice about improving public relations surrounding the federal criminal indictment of the utility.

"PG&E's decision to issue a press release last week anticipating all this only meant that the public got to read two big stories rather than one. I think this was inept," Peevey wrote.

San Bruno officials called Monday for Peevey to step down from the commission and sent a letter to Gov. Jerry Brown asking for Peevey to be fired.

"There is a very cozy relationship between the PUC and PG&E, and the results of that cozy relationship killed eight people," San Bruno Mayor Jim Ruane said at a news conference on the commission's steps. The emails show "it was illegal, improper and has to change."

An attorney for the city, Britt Strottman, filed two motions with the CPUC calling for Peevey to be removed from proceedings regarding the utility. The city also reserves the right to pursue the matter in state court, she said.

PG&E President Chris Johns said in a statement the company is required to communicate regularly with the commission.

"The company is committed to the highest ethical standards," Johns said.

The commission is focused on resolving numerous internal legal proceedings aimed at issuing fines against PG&E and improving pipeline safety, said commission spokeswoman Terrie Prosper.

"The CPUC takes seriously all allegations of bias and rule violations and will evaluate the motions," she said in a statement.