PG&E Wildfire Fines Hiked To 2.1 Billion
Sonora, CA — California power regulators slapped Pacific Gas and Electric (PG&E) with a $2.1 billion fine for sparking a series of deadly wildfires that landed the beleaguered utility in bankruptcy.
The new funds will set aside millions for victims and denying the utility to charge customers for the loss. It is an increase from the punishment that had been agreed upon in a $1.7 billion settlement announced in December. The penalty was adopted by an administrative law judge in his decision issued on Thursday.
The increased punishment includes a $200 million payment to the state earmarked for those who lost family members, homes and businesses in catastrophic wildfires during 2017 and 2018 due to the utility’s outdated electrical grid and negligence. With more than 81,000 claims filed in the company’s bankruptcy case, the funds will supplement $13.5 billion already being set up in its effort to emerge from bankruptcy protection by a June 30 deadline.
PG&E will also not be able to turn to its customers to recover $1.82 billion in losses as the decision prevents that and instead forces its shareholders to bear the cost.
Even after reaching settlements totaling $25.5 billion with the wildfire victims, insurers and some government agencies, the company still needs to clear another hurdle. Gov. Gavin Newsom continues to threaten a government-led takeover bid of the utility unless changes are made to its current plan for getting out of bankruptcy. PG&E also needs state approval of the plan to qualify for coverage from a wildfire insurance fund created by California last summer.
