California's Biggest Utility Plans Bankruptcy Filing After Wildfires
California's largest utility is preparing to declare bankruptcy after a string of wildfires in 2017 and 2018 left it with $30 billion or more in potential liabilities. The announcement comes a day after CEO Geisha Williams stepped down.
"PG&E currently plans to file for Chapter 11 on or about January 29, 2019," the company announced Monday. "We do not expect any impact to natural gas or electric service for our customers as a result of the Chapter 11 process."
A report from the Wall Street Journal on Sunday determined that PG&E power lines and other equipment started more than 1,500 fires in recent years—or about one fire a day. Several of these fires grew into major and deadly infernos exacerbated by the region's unrelenting drought.
State officials determined that PG&E's electrical equipment was responsible for at least 18 of 21 significant fires in 2017 as well as fires in 2018, The New York Times noted.
Some of those fires were sparked by its power lines falling onto trees, which critics say is a result of PG&E not properly maintaining trees and limbs around the lines.
The energy giant is facing multiple lawsuits from wildfire victims and is being investigated for its potential role in starting the record-breaking Camp Fire in Northern California that killed 86 people, burned thousands of buildings and destroyed the town of Paradise.
The utility's safety record has been under fire ever since it was found guilty for its role in the 2010 natural gas pipeline explosion that killed eight people in San Bruno, California.
PG&E provides natural gas and electric service to approximately 16 million people in northern and central California.
UC Berkeley energy economist Severin Borenstein told The San Francisco Chronicle that the immediate impact on its customers would be "almost negligible." Lynn LoPucki, a UCLA law professor, added that filing for Chapter 11 does not necessarily mean that customers' bills will increase.
However, one of the biggest losers could be the environment, as PG&E made commitments to help California reach its ambitious clean energy goals, including investments in lower-emission vehicles, renewables, energy efficiency and infrastructure.
A bankruptcy judge could advise PG&E to curtail such investments, Borenstein explained to The Chronicle.
"I could very well see the judge saying, 'You're gonna have to let somebody else lead the fight against climate change; you gotta focus on staying financially viable,'" he said.