California’s largest investor-owned utility Pacific Gas and Electric Company is filing for Chapter 11 bankruptcy protection as a result of its liability for damages from the deadly wildfires that devastated Northern California and killed dozens of people. The company is facing a financial crisis, CNN reports, as it faces at least $30 billion in costs for the damages resulting from wildfires caused by its faulty equipment.
On Sunday, the company announced that its CEO Geisha Williams would be leaving and the company’s general counsel John Simon will be stepping in for the time being. On Monday, a regulatory filing revealed that it would file Chapter 11 bankruptcy protection by the end of the month.
According to the filing, the bankruptcy is “ultimately the only viable option to restore PG&E’s financial stability to fund ongoing operations and provide safe service to customers.”
The energy giant has been faced with financial problems since investigators determined that it was PG&E’s equipment that caused 18 of the 21 largest fires in 2017 and 2018, including the deadly Camp Fire, which resulted in the death of at 85 people and destroyed 14,000 homes. The company says that it is aware of 50 complaints by at least 2,000 plaintiffs seeking restitution as a result of that fire.
Investigators say that the fire began when a power line connected with nearby trees. After the blaze, the company found a fallen power pole covered in bullet holes and a downed line with tree branches on it.
There are an additional 700 complaints on behalf of 3,600 plaintiffs related to other wildfires, including the series of wildfires in 2017 that caused $10 billion in damages and 44 deaths. Investigators in those fires said that 11 of the fires were caused by code violations that resulted in brush being near power lines.
“The people affected by the devastating Northern California wildfires are our customers, our neighbors and our friends, and we understand the profound impact the fires have had on our communities and the need for PG&E to continue enhancing our wildfire mitigation efforts,” said Simon. “We remain committed to helping them through the recovery and rebuilding process.”
Shares in the company have been down since the Camp Fire, but stock cratered even further after the company announced its intention to file for bankruptcy. Shares dropped nearly 50 percent in early trading, bringing loss to more than 80 percent in the last three months.
The company has a 70,000 square mile service area in California and serves 16 million customers.
As of this morning, the company had put barricades in front of their headquarters in anticipation of possible protesters and concerned victims of the fires.
We just pulled up to PG&E- they have workers putting up barricades in front of their building. The security guard said “no comment” when I asked why. The utility just announced this morning it is preparing to file for chapter 11 bankruptcy. The CEO resigned. pic.twitter.com/w73fWXx9S9— Amy Hollyfield (@amyhollyfield) January 14, 2019