PG&E Reportedly Eyeing Breakup, Bankruptcy In Wake Of Multiple Devastating Wildfires

Roman Schwartz
January 8, 2019

The filing isn't certain, the people said, but it may be enough to force the hand of state legislators who could come up with a rescue package.

State Senator Jerry Hill, an outspoken PG&E critic, said the utility previously raised the possibility of a bankruptcy filing as leverage when seeking state assistance in paying its wildfire liabilities.

PG&E announced the assessment Friday in a news release, citing "the growing wildfire threat".

PG&E, which filed for bankruptcy once before in 2001, said in November it could face "significant liability" in excess of its insurance coverage if its equipment was found to have caused last year's fires in northern California.

PG&E also faces dozens of lawsuits from owners of homes and businesses that burned during 2017 fires.

The cause of the Camp Fire is still under investigation, according to state fire officials.

Hiring surged in December, employers added 312000 jobs
The ISM manufacturing index fell 5.2 percentage points in December and an index measuring new orders tumbled 11 percentage points. That lifted the annual increase in wages to 3.2 percent, matching October's rise, which was the largest in 9-1/2 years.

The utility has been wrestling with how best to proceed after two years of destructive fires.

A new law signed by California governor Jerry Brown a year ago, requires the commission to consider a utility's finances when evaluating damages caused by wildfires, in order to determine the maximum amount it can pay without harming customers.

The ratings agency said the downgrade reflects PG&E's recent announcement that its board was reviewing the company's management, finances, governance and structural options. It also said it is searching for new directors at its holding company and its utility subsidiary Pacific Gas and Electric Co.

The San Francisco Chronicle in December reported that California state Senator Bill Dodd called for a management shakeup at PG&E in light of the CPUC findings. The utility's total market value is now below $15 billion, and PG&E has just $3.5 billion in cash after borrowing from an existing revolving credit line.

Earlier last month, the California Public Utilities Commission (CPUC) opened a proceeding to consider penalties against the company, ordering immediate action against the utility for falsifying safety documents for natural gas pipelines. It emerged from bankruptcy in 2004.

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