Are You Ready? Napa Wine Country Suffers Power Outage As PG&E Shuts Off Power To Avoid Wildfire

Napa Valley, Are You Ready?

PG&E Begins to Cut Power for Nearly 800,000 Customers Due to Wildfire Risk.

Large swaths of Northern California woke up in the dark early Wednesday as Pacific Gas & Electric began its sweeping plan to shut off power to about 800,000 customers in a desperate attempt to avoid wildfires sparked by wind-damaged power equipment.

The first power cutoffs, expected to affect 513,000 customers, began shortly after midnight in several counties around Sacramento, including Placer and Yuba, amid strengthening winds and continued to roll out into the early morning hours, eventually leaving millions of Californians in the dark.

By 12:30 a.m., power was cut in large portions of wine country, including Napa and Sonoma valleys. Portions of Marin County just north of San Francisco lost power next. Minutes later, the utility cut service in El Dorado County and sections of the upper Sacramento Valley. By 5 a.m., the outages had extended to Humbolt County to the north, Marin County to the south and as far as Nevada County to the east, according to the utility.

The second phase of the shutoff is expected to occur around noon in areas around Silicon Valley and the East San Francisco Bay. About 234,000 customers in Alameda, Alpine, Contra Costa, Mariposa, San Joaquin, San Mateo and Santa Clara counties are expected to be without power.

The utility said Wednesday it was also considering shutting off power to about 42,000 customers in the southernmost portion of PG&E’s service area, but specific locations have not been determined.

On Tuesday, Southern California Edison announced it also was considering preventive power outages. The utility said that given the anticipated strong Santa Ana winds, power could be cut off to more than 106,000 customers in parts of eight Southern California counties, including Los Angeles County.

Here is the current PG&E power outage map. Napa Valley (wine country), and the Sierra foothills are the major sufferers in PG&E’s attempt to avoid another Paradise, California incident.

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Of course, PG&E is in bankruptcy having defaulted on its interest payments to bondholders.


PG&E bonds are trading at near par and their stock is trading at around $11 per share.


Are you ready for more power outages??


Free Cat? World’s Best-Run Pension Funds Say It’s Time to Start Worrying (Not Enough Revenue Thanks To ECB Policies And Inflated Liabilities)

State and Federal pension funds are plagued by extravagant promises to pensioners and low yields on pension assets caused, in part, by Central Banks, like the European Central Bank and Federal Reserve.

(Bloomberg) Back in 2012, the world’s best-managed pension market was thrown a lifeline by the Danish government to help contain liabilities. That was when interest rates were still positive.

Seven years later, with rates now well below zero, even Denmark’s $440 billion pension system says the environment has become so punishing that it may be time for a change in European rules.

Henrik Munck, a senior consultant at Insurance & Pension Denmark, an umbrella organization, says the way liabilities are currently calculated “could cause a negative spiral” that forces funds to keep buying low-risk assets, drive yields lower and the value of liabilities even higher.

The warning comes as pension firms across Europe struggle to generate the returns they need to cover their growing obligations. In Denmark, some funds saddled with legacy policies guaranteeing returns as high as 4.5% have had to use equity to meet their obligations.

To calculate liabilities, pension firms use a complex mathematical formula constructed by the European Insurance and Occupational Pensions Authority (EIOPA). The formula is intended to shield funds from erratic market swings that artificially inflate or hollow out balance sheets. But with negative rates more entrenched, there are signs the EIOPA curve, as it’s called, may not be working as intended.

“When pension funds across Europe de-risk simultaneously, it may actually become pro-cyclical: it increases the price movements, and it could result in yet more downward pressure on the EIOPA yield curve, exacerbating the problem,” Munck said.

The curve is comprised of several elements. Its backbone — the euro interest-rate swap curve — has sunk since its implementation about four years ago, driving up the value of liabilities.


PFA, like many Danish pension funds, started scaling back guaranteed products for retirees many years ago. That’s given it a buffer to help absorb some of the shock of growing liabilities. But not everyone’s as well prepared. “If the discount curve is more volatile and you can’t hedge it, you can — if you don’t have enough capital — be forced to lower risk on the more hedgeable space, to compensate,” Damgaard said.


Low volatility assets like sovereign debt?? Pretty soon, government pensions will have to deliver cheaper payments to pensioners.

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