Newsom names ‘energy czar’ amid California blackouts, suggests state could take over PG&E

Nov. 1--California Gov. Gavin Newsom designated a top aide as his "energy czar" in the wake of Pacific Gas & Electric Company's prolonged power outages and on Friday suggested the state could take charge of the bankrupt utility.

"The entire system needs to be reimagined," Newsom said at a press conference.

Ana Matosantos will continue to serve as Newsom's cabinet secretary while also working as the state's energy czar, where she will be charged with helping fix the state's utility problems.

During the news conference, Newsom initially indicated Matosantos would step down as cabinet secretary -- the second-highest-ranking cabinet member -- to take the position, but his office later said he misspoke.

PG&E, the state's largest privately owned utility, is in bankruptcy proceedings as it deals with billions of dollars in claims for damages related to wildfires caused by its equipment in 2017 and 2018.

"We share the governor's focus on reducing wildfire risk across California and understand that PG&E must play a role in these efforts," PG&E spokesman James Noonan said in a statement. "We welcome the governor's and the state's engagement on these vital matters and share the same goal of fairly resolving the wildfire claims and exiting the Chapter 11 process as quickly as possible."

Newsom prodded the company to move quickly. He wildfire victims need money immediately and cannot afford to wait until the company's June 30 deadline for exiting bankruptcy.

Newsom raised the possibility of the state taking charge of the utility, although he declined to give specific details about how that would look.

"PG&E may or may not be able to figure this one out," Newsom said. "If they cannot, we are not going to sit around and be passive. We are gaming out a backup plan. If PG&E is unable to secure it's own future... then the state will prepare itself as backup for a scenario where we do that job for them."

Frustrated with the positions of the different groups involved in the bankruptcy process, U.S. Bankruptcy Judge Dennis Montali appointed retired bankruptcy Judge Randall Newsome as a mediator earlier this week. The team Newsom unveiled on Friday is expected to work with Montali to expedite the bankruptcy process and broker a deal.

"This is not Plan A, but it is a plan," Newsom said.

Before joining Newsom's cabinet, Matosantos served as finance director under Govs. Jerry Brown and Arnold Schwarzenegger. She also served on a seven-member commission appointed by former President Barack Obama to oversee Puerto Rico's finances during the territory's debt crisis.

Matosantos' energy strike team includes several other cabinet members: legal secretary Ann Patterson, energy adviser Alice Reynolds and legislative strategist Rachel Wagoner.

Newsom is asking them to determine how to make the state's energy equipment safer, potentially by moving power lines underground or by dividing infrastructure into "micro-grids."

Within weeks, Newsom wants the group to release a "broad strokes" outline for how utilities need to change to meet modern challenges.

"This is not the new normal, and this does not take 10 years to solve," he said.

Newsom didn't say how much he expected the changes would cost the state, although he noted that his administration doesn't want to put the state's budget "at risk."

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