San Francisco cleared the path to seize PG&E's grid; the price war starts 20 October

San Francisco's supervisors spent Tuesday excoriating the utility that owns the city's power lines, then voted unanimously to reject PG&E's bid to delay the city's takeover of them ¹. Mayor Daniel Lurie is skeptical of a purchase but is not blocking it ¹.

The next number arrives on 20 October 2026, when PG&E must publish its own estimate of what its San Francisco grid is worth: the first hard figure in a valuation case opened at the state Public Utilities Commission in 2021 ¹. The city's appraisal, from April↗: $3.4 billion ¹.

PG&E's answer: billions in separation costs and 74 lobbyist calls

PG&E says the appraisal ignores "the billions of dollars necessary to physically separate San Francisco from PG&E's grid," and "grossly undervalues" assets whose loss would saddle customers with higher rates for years, if not decades ¹. It counts $370 million of reliability work in the city this year ¹.

Its lobbyists have logged 74 contacts with Lurie or his staff since February 2025, twenty of them about public power ¹. If the city moves to condemn, a lawsuit under California's environmental law is "probably" next, one eminent-domain attorney said ¹.

Sacramento's dead fire deal already priced the risk into bills

The fight lands on a utility Sacramento just wounded. The Assembly adjourned on 1 September 2026 without voting on Senate Bill 492↗, leaving utilities liable for fires their equipment starts regardless of negligence ². Wildfire liabilities run about 5 percent of the average California bill and mitigation another 15 percent, by the state regulator's count ². Fire, past and future, already takes one dollar in five.

The utilities told lawmakers they collectively lost more than $20 billion of market value in three trading days ³. Fitch has downgraded PG&E, and Chief Executive Patti Poppe has opened a strategic review, guided by four independent directors↗, that has asset separation on the table ⁴⁵. Without fast reform, she warns, housing slows, clean energy and AI power get delayed, and customers, not insurers, hold the catastrophic risk ⁴.

The relief actually arriving is smaller: $886 million in summer bill credits↗, about $75 a household ⁶.

The AI buildout queues behind a utility cutting spending

PG&E's data-center pipeline more than doubled to 12.7 gigawatts↗ at the end of June 2026, from 5.1 in March ⁷. Only 490 megawatts of it hold interconnection construction agreements; another 26 projects totaling 8.2 gigawatts have applied and paid a study fee ⁷. Each added gigawatt trims customer bills by 1 percent or more, the company says ⁷.

The $2 billion PG&E cut from its 2027 capital plan, to $11.4 billion from $13.4 billion, lands on this queue ⁸⁹. Deferred work could delay connections for new homes, renewable projects and data centers↗, the utility warns ⁹¹⁰. Poppe is holding the first 1.8 gigawatts of announced projects harmless, but the cut "certainly slows the pipeline," she said ⁹.

The fork: revenue bonds or condemnation, and who eats the gap

Two paths, two losers. Near $3.4 billion, San Francisco buys with revenue bonds repaid from city electric revenue, and the gap between that price and the value PG&E claims would land on its shareholders, not on city bills ¹. Far above it, the fallback is eminent domain and a probable environmental-law suit: years of PG&E rates while the case runs, at a price a court sets ¹.

The swing number is the one nobody has published: the billions PG&E says separation costs. Whether it is real, and who absorbs it, is what the 20 October filing begins to answer ¹. The second thing to watch is who Lurie appoints to succeed Dennis Herrera, the retiring utility chief who has been the takeover's biggest champion ¹.