These recent events have led many to question whether PG&E should still be a monopoly as it provides power to most of Northern California. The first major question to address is why PG&E is a monopoly and why the government allows them to operate as a monopoly. Utility companies in the US tend to be natural monopolies due to the high cost of constructing and maintaining infrastructure which generally means that traditionally utility companies don’t have competition. It would be almost impossible for a startup to build a brand new power grid for the entire Northern California.
Many wonder if there are alternatives to PG&E. Unfortunately, not really. There are some cities, like Alameda or Sacramento that are served by publicly-owned utilities, however residents still can’t decide for themselves where they want their power to come from. Having multiple private companies in charge of different power grids and power lines would probably be unsustainable and unreliable and extremely complicated to regulate and manage. However, as PG&E becomes less reliable in the eyes of residents, the question of public utility monopolies still looms ahead.
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I really liked how your blog connected what we're learning about monopolies in history to current events happening even in our state. I have been following the PG&E shut down in the news but I never made the connection that they might be considered a monopoly! So, I did some research on what actually constitutes a monopoly that requires government intervention. In an article I read, it explained that the U.S. the law cannot punish a company for being the sole provider of a service, but it will punish a company for using unfair practices to maintain/expand. This makes me wonder what the government considers "abusive practices" and whether PG&E has violated any of the law's requirements. Overall, super interesting read!
ReplyDeletehttps://www.investopedia.com/ask/answers/041415/what-are-common-examples-monopolistic-markets.asp##targetText=The%20U.S.%20markets%20that%20operate,actually%20created%20by%20government%20action.
I thought it was really interesting that you connected the modern monopolies such as PG&E with the past monopolies we learned about. I thought the detail you included about issues PG&E has and the issues the public has with the corporation was very interesting. I think the contrast between the issues of present monopolies and past monopolies is very intriguing. These present monopolies such as PG&E are criticized realty for their issues with safety due to the fact that they control such a large area, although past monopolies were much more ciotized for having too much control over the government or too much wealth. Although similar past and present monopolies gain power due to lack of competition and lack of government intervening.
ReplyDeleteI think that this was a very good connection to the recent unit in this class and it shows how monopolies can be damaging and continue to cause problems today. PGE is a monopoly but it is completely legal and is regulated by the California Public Utilities Commission. I think a big question is if the regulation has been focused enough and why PGE has still managed to create so many problems. It does connect strongly to historical monopolies like railroads because we have no other choice to get electricity, so we have to pay them no matter what.
ReplyDeletehttps://www.sfgate.com/local/article/alternatives-to-pge-other-options-rates-monopoly-13533155.php