No clear path for California as massive PG&E utility nears bankruptcy
SACRAMENTO, Calif. (Reuters) - PG&E Corp’s announcement that it will file for bankruptcy, citing massive potential liability from deadly wildfires, puts California politicians in quandary, whether to offer a bailout or risk allowing the state’s largest private utility to fail.
Governor Gavin Newsom, a Democrat, told reporters late on Monday his team was discussing the possibility of helping PG&E (PCG.N) stay solvent, but no decisions had been made.
And lawmakers in the state legislature, who last year approved a bill making it easier for PG&E to bill ratepayers for the costs of wildfires sparked by its equipment in 2017, said that there was less support this year for extending additional financial assistance to the company.
“We would like to see it (bankruptcy) avoided, but we are not naive,” Newsom said. “I’m cognizant of the taxpayers, and I’m cognizant of the ratepayers, and I’m absolutely cognizant of those who lost everything.”
PG&E’s announcement on Monday that it intends to file for Chapter 11 bankruptcy protection as early as this month, citing potential liability exceeding $30 billion due to wildfires, came a day after its chief executive officer, Geisha Williams, was ousted from her post.
PG&E, which ranks as the largest U.S. power utility by number of customers, supplies electricity to 40 percent of Californians. The state, Newsom said, is determined to keep service running to those customers.
But the utility’s power equipment has been linked to the ignition of more than a dozen wildfires in the past two years, and is a suspected cause of the deadliest fire in state history, which swept through the town of Paradise in November, killing 86 people and destroying 90 percent of homes and businesses there.
Mark Toney, executive director of consumer advocate group the Utility Reform Network, said the atmosphere had cooled considerably toward PG&E in recent months, making a bailout politically more difficult for lawmakers.
“PG&E is going to have a much harder time because it doesn’t appear that they’ve learned any lessons,” Toney said.
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>https://www.reuters.com/article/us-pg-e-us-bankruptcy-politics/no-clear-path-for-california-as-massive-pge-utility-nears-bankruptcy-idUSKCN1P909E?il=0