PG&E’s Patti Poppe Responds to San Francisco Mayor Breed’s Recent Letter Regarding Outages in San Francisco

Mayor Breed:

Thank you for your recent letter and for your continued focus on our shared aim of providing safe, clean,
reliable and affordable energy to our customers in San Francisco. I am responding to your comments
about recent outages and the City and County of San Francisco’s plan to acquire PG&E’s assets in the
City.

Recent Outages
At PG&E, we strive to always keep power flowing for our customers. Nevertheless, outages can occur,
including from time-to-time outages that last longer than 24 hours. We know that an outage, no matter
how small or short in duration, can cause a significant disruption to the lives of our customers. To serve
the City during any such events, we provide prioritized restoration (including bringing electric crews from
outside of the City), assessment of backup power needs, enhanced customer and stakeholder
communications, and other resources before and during power outages to critical facility customers that
provide essential public services, such as hospitals, police and fire stations. These measures can help
mitigate against long-duration outages, as can customer-owned backup generation.

The outage that began the evening of April 26 in San Francisco impacted 9,454 service connections.
PG&E was on scene within 15 minutes of the initial call and immediately started assessing and planning
for the restoration as the situation was made safe by the City’s first responders. The majority of service
connections (8,876) were restored in less than 24 hours. The remaining customers experienced an
extended outage and were restored on April 30.

To respond to the outage, we quickly activated our local emergency operations center, which follows the
Incident Command Structure (ICS) and is staffed with individuals who are trained in responding to
incidents and events.

Impacted customers received direct communication with an initial estimated restoration time and updates
as the assessment, repair and restoration process unfolded. As the event progressed and we realized
restoration may be extended, we installed a generator at 440 Gateway and looked at temporary generation
for additional customers, but it was technically infeasible. Over the weekend, we had company
representatives on site who could communicate with customers in language. The team provided water and
hundreds of food vouchers to customers who remained without power.

Additionally, we were in frequent communication with CCSF leadership and public safety partners.
As part of the emergency protocols, we assigned a single point of contact for City officials (Bill
Chiang from our Local Government Affairs team) and a Public Safety Specialist (Jim Wickham) to
communicate with CCSF’s Public Safety officials. These two individuals communicated with city
and public safety contacts more than 50 times over the course of the outage. In addition to the
individual outreach they conducted, both Bill and Jim participated in the scheduled SFDEM calls
that were held once or twice daily throughout the event.

As mentioned, our teams conduct increased outreach during emergencies, but you always have
access to the team should you have questions, ideas, concerns, or escalations outside of the regular
updates.

Finally, Aaron Johnson, PG&E’s Regional Vice President for the Bay Area region, participated in
emergency operations coordination during this event and helped ensure all needed resources were
made available for customers and crews performing the work. Aaron Johnson is available to support
in the event of any significant issues, including major outages or emergencies, that occur in the
region.

While our teams are still in the process of conducting a full investigation on the cause of the April
26 outage, we have validated that routine scheduled inspections were conducted on the affected
equipment, which was operating within normal parameters.

The storm-related outage at San Francisco General Hospital in March was longer than desired due to
multiple instances of storm damage to the electrical grid in and around the facility. Again,
communication between the City and PG&E was robust throughout the event. Aaron Johnson has
followed up with San Francisco Public Utilities Commission Assistant General Manager for the
Power Enterprise Barbara Hale to explain what transpired and proposed a formal after-action review
(AAR), which we are in the process of scheduling. In the meantime, PG&E’s customer account
manager assigned to CCSF has scheduled an AAR with the SF Department of Public Health next
week. This collaborative effort will allow both the City and PG&E to identify opportunities to
improve operations and communications, and to reinforce incident command communication
channels for the City and hospital, which is SFPUC’s customer of record.

As to the 2021 outage at the City’s new 911 facility, we recognize the importance of this critical
customer and it was among the first sites visited by Aaron Johnson in taking on his regional
leadership role two years ago. To ensure the resiliency of this critical facility, we urge the City to
consider adding a second electrical connection to this critical facility to increase reliability – a best
practice for critical emergency operations facilities. We stand ready to help engineer that resiliency
solution to support our customers.

CCSF’s Takeover Effort
As you noted, PG&E’s core focus is to provide safe, clean, reliable and affordable service to our
customers.

We do not believe that the City’s attempt to take our assets benefits our customers. In fact, we
expect that the City’s spending billions of dollars to replace PG&E will detrimentally affect
customers inside and outside of San Francisco. This is exactly the position that we have taken in
response to the City’s petition at the CPUC and why we will continue to contest that takeover effort.

As a preliminary matter, CCSF has substantially undervalued PG&E’s assets. The City’s 2019 offer
of $2.5 billion does not recognize the true value of these assets. The City’s more-recent submission
to the CPUC, which reduces that valuation, reflects the City’s lack of understanding of our asset
base, its value, and the complexity of this work. PG&E has proposed and has already invested or is
in the process of investing $3 billion in capital projects in San Francisco between 2005 and 2025,
which alone exceeds the City’s offer. Ultimately, we estimate that the true cost of acquiring this
infrastructure will be billions of dollars higher than the City’s offer, leaving customers in San
Francisco to face increased energy bills, decreased city services, and higher taxes to pay for the
takeover.

You may be aware that IBEW, Local 1254, the union representing the men and women who
currently serve San Francisco, opposes the City’s takeover effort, raising serious concerns about the
city’s ability to recruit a qualified workforce. In the face of climate change and more frequent
extreme weather, PG&E leverages a systemwide resource pool to hasten emergency response. A
newly formed government-run utility with an inability to recruit qualified talent would lack those
resources and stand alone in its response, ultimately reducing reliability and impacting customers.

San Francisco’s proposed takeover will also negatively impact our customers outside of San
Francisco. Fragmenting the State’s energy policy will negatively affect ongoing efforts to advance
California’s critical climate goals and address wildfire risk, as well as increase other customers’
costs, reduce reliability, and impact safety. There are also significant questions about the City’s
ability to do this critical work given the significant scale and complexities of the assets that the City
is proposing to take.

In the face of this ongoing disagreement about who is best qualified and situated to provide
electrical service in San Francisco, it is essential that we improve the on-the-ground working
relationship between City departments and PG&E to provide the best possible service to the
residents of the City. For example, Aaron Johnson and Interim Director of the Department of Public
Works Carla Short and our staffs have been working together over the last month to improve
PG&E’s response to City projects that require utility support, and to provide timely permits to
PG&E to perform maintenance work and connect new customers. This sleeves-rolled-up approach to
collaboration reflects our desired working relationship.

We are committed to serving San Francisco residents and are prepared to meet to further discuss any
concerns related to the recent outage once we have completed our investigation. Sarah Yoell, the
manager of our Local Government Affairs Bay Area team will be following up with your office to
schedule a time to meet in the near future.

Sincerely,
Patti Poppe