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PG&E Utility Loses Two Executives

In the midst of intense consumer and regulatory unrest, Pacific Gas and Electric Co. (PG&E) acknowledged Thursday that it will be replacing two of its key senior executives: COO John Keenan and Senior Vice President for Engineering and Operations Edward Salas.

The changes were made as a result of a decision on organizational structure by PG&E Corp. CEO Peter Darbee and utility President Christopher Johns last Tuesday, a utility spokesperson told NGI on Thursday. That structural decision was to eliminate the COO and the senior vice president for engineering and operations positions "as part of the strategic changes in PG&E's operational structure," he said.

However, the outgoing executives were not asked to step down by Darbee or Johns, the spokesperson said. The San Francisco-based combination utility has been under pressure regarding its smart meter installations and the transmission pipeline eruption in San Bruno, CA, last September, which killed eight people.

A Securities and Exchange Commission (SEC) filing by PG&E on Wednesday cited a settlement agreement between the corporation and Keenan to "resolve [Keenan's] claims against the utility for certain pension and post-retirement benefits." That agreement was signed last Tuesday, the day of the reorganization decision.

Both Keenan and Salas, neither of whom were long-time PG&E employees, have been overseeing operations involved with the gas pipeline system and the two-way smart metering technology.

In the SEC filing, the utility said Keenan, 62, was leaving April 30, taking with him a severance package of nearly $3.2 million. He had been COO since early 2008 and was chief nuclear officer before that. A Forbes.com profile showed his 2010 total compensation at more than $2.6 million, without a bonus. Salas will leave sometime shortly after Keenan; there has not been an SEC filing related to his departure.

PG&E is characterizing the departures as part of a "strategic reorganization" at the top of the utility with the intention of having separate senior officers in charge of the natural gas and electric operations, eliminating the chief operating officer position that Keenan now holds. Both senior vice presidents in charge of gas and power operations will report to Johns.

The new electric side senior vice president will be Geisha Williams, currently the senior vice president for energy delivery. A previously announced search is still under way for the position heading the gas operations.

Keenan came to PG&E a little more than five years ago to be its chief nuclear officer after serving in similar capacities in the utility industry in North Carolina and New England; Salas came to the combination gas-electric utility in late 2007 after many years in the telecommunications industry; and Williams came to the San Francisco utility from Florida Power and Light at about the same time Salas arrived.

"As we have been saying for some time, a major focus for us is improving our operations," the PG&E spokesperson said. "We will continue to evaluate our organizational structure and make changes where we believe they are appropriate."

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