PG&E Halts Water Infrastructure Negotiations With TUD

Sonora, CA — TUD has been planning to purchase PG&E water infrastructure like Pinecrest Reservoir and Lyons Dam, but those negotiations have been suspended, at least temporarily.

PG&E reports that the pause is prompted by a desire to “re-evaluate the long-term strategy” around how to best “optimize the ownership and operation of its power generation assets.”

Mike Schonherr, PG&E’s Director of Strategic Agreements, says in a written statement, “I realize TUD has invested a lot of time and energy in this transaction, and that you have a number of public processes underway. We regret any hardships this decision may have caused and hope you can appreciate that PG&E did not make this decision lightly.”

The negotiations will remain on hold until at least the end of 2023, and the existing water contract between the two entities will stay in place. TUD will also be pausing its correlating plans to increase water rates in September.

TUD Board President Barbara Balen says, “It is frustrating to come so close to finalizing an agreement to gain local control of these PG&E assets, because of just how much it would have benefitted everyone in the county. I do, however, find comfort knowing the existing PG&E/TUD agreement providing the district with water remains enforceable and in effect, and look forward to resuming negotiations with PG&E.”

No additional information is immediately available.