California’s Largest Utility Goes Bankrupt Under Billions In Wildfire Debt
Pacific Gas and Electric (PG&E), California’s largest utility company, filed for bankruptcy at midnight on Tuesday, seeking to escape potentially $30 billion in liabilities, CBS News reports.
The company announced its plans to pursue bankruptcy protection two weeks ago after its CEO, Geisha Williams, stepped down reportedly over fallout from the utility’s wildfire debt. PG&E said then that bankruptcy “represents the only viable option to address the company’s responsibilities to its stakeholders.”
PG&E is seeking $5.5 billion in bank loans on top of a $10 billion loan granted by the California Public Utilities Commission in San Francisco Monday to carry the utility through the bankruptcy process while continuing to serve its roughly 16 million customers, according to CBS News.
The bankruptcy may leave ratepayers and wildfire victims worse off. PG&E will be free from paying off damages from wildfires sparked by its equipment, and the utility may raise rates as part of its financial reorganization, CBS reports.
Investigators found that equipment owned by PG&E sparked at least a dozen major fires in 2017. California officials are still investigating the causes of several major 2018 fires, including the Camp Fire that killed 86 people and all but destroyed the town of Paradise.
Some have attempted to blame global warming for PG&E’s bankruptcy, and Williams said the company was under pressure from “climate-driven extreme weather.”
The Camp Fire and wine country fires of 2017 “were associated with a failing and poorly maintained power infrastructure, strong Diablo winds, and people living in inappropriate locations on the wildland-urban interface,” University of Washington climate scientist Cliff Mass told The Daily Caller News Foundation Jan. 15.
The California legislature took steps in 2018 to limit the company’s liability for 2017 fires by passing a bill that many criticized as a “bailout.” The law allows PG&E to hike rates on its customers to pay off liabilities for 2017 wildfires. The legislation did not affect potential liabilities for 2018 wildfires.
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