The blackout factor - Page 3

PG&E's poor reliability record costs businesses millions

and the losses can go on and on.

Those ripples are larger and go farther in many high tech industries. Larry Owens of Silicon Valley Power said that consistent, reliable power is especially important for the high tech firms located in Santa Clara, including Applied Technologies, Inc., McAfee, Inc., and Intel Corp.

"There are some processes that require a 21-day burn in," he said. "If there is a power outage, they have to start all over again. An outage can cause a company to lose market share or dominance or preferred vendor status. It ripples out a long way."

Some companies have such sensitive systems that a drop in voltage for a mere fraction of a second can shut them down and require rebooting.

"Our customers have become power-quality sensitive," Larry Owens said. "It doesn't take an outage to harm a business. A fault on a transmission line causes the whole system to dip, a voltage dip. If you have a heavy load, it knocks the voltage down for milliseconds. If it drops enough, companies' systems drop out."

State Sen. Mark Leno is intimately familiar with the problem — he owns Budget Signs. And he has called on the California Public Utilities Commission to investigate the problem.

"As a San Francisco small business owner, I am personally aware of the lost business I experience as a result of PG&E's performance failures," Leno said in a press release. A June 18 letter Leno sent to the CPUC noted: "As the commission considers PG&E's request to upgrade its grid, I would ask you to include both an investigation of these problems and PG&E's proposed solutions to them."

Almost a month later Michael R. Peevey, president of the CPUC, responded, arguing that PG&E's reliability rate in 2008 was better in the previous few years. He also pointed out that the utility has a formal process for filing claims and that the commission has no authority over system reliability.

That, Leno said, is unacceptable. "From reading that letter, one would never know that the mission of the California PUC is to be the protector of the ratepayer," he told us. "The ratepayers are being badly served by PG&E and the CPUC."


In theory, state law requires PG&E to reimburse businesses for losses caused by blackouts. A business owner or manager can find the claim form on PG&E's Web site or can call the claims office. Each case is assigned to one of the 21 claims investigators who cover the utility's service area. With the help of supporting documents, investigators look into the occurrence, determine PG&E's liability and the degree of monetary loss, and compensate the business accordingly. All, according the Web site, within an average of 30 days.

Emily Mitra, owner of Dosa, which operates Indian restaurants in the Mission District and the Fillmore District followed this process — and it wasn't that simple.

On Dec. 18, 2008, a PG&E transformer blew and both locations of Dosa lost power. Mitra had to contend with food spoilage, staff costs, down equipment, lost business, all of which added up to about $12,000.

"We filed claims, but it was a long process," she said. "A check came for the Valencia Street location immediately but for the Fillmore location, PG&E didn't even have record of an outage."

After three months of badgering PG&E to no avail, Mitra said she contacted Sup. Ross Mirkarimi's office and the Small Business Commission.

"I was ready to sue them," she said. "I had dozens of witnesses, but that didn't seem to faze them. It could have been a coincidence that they found the data right after we talked to the Small Business Commission. But it was a pretty quick turnaround after that."

A check arrived for the full amount of the claim.

Also from this author

  • The $2.8 billion rate hike

    PG&E's higher electric rates will suck vast sums from SF's economy

  • Fewer young people using drugs

    THE DRUG ISSUE: When it comes to illicit substances, SF's kids are alright.