California energy company Pacific Gas and Electric has filed for Chapter 11 bankruptcy, the company announced Tuesday. PG&E is facing roughly $30 billionin potential liability after it causedhundreds of fires in the past few years.
In addition to billions in liability, the company also faced state regulators who were considering breaking the company into pieces or even making the company a public utility. And California Attorney General Xavier Becerra had floated the idea of trying PG&E for murder if it was found to operate its equipment in a reckless manner. Ultimately, the company decided declaring bankruptcy was the best option.
"We are fully committed to enhancing our wildfire safety efforts, as well as helping restoration and rebuilding efforts across the communities impacted by the devastating Northern California wildfires," Interim CEO John Simon said in a statement. "To be clear, we have heard the calls for change and we are determined to take action throughout this process to build the energy system our customers want and deserve."
PG&E is working out a $5.5 billion "debtor-in-possession" financing deal with several banks to give the company the necessary funding to keep delivering power to customers while the bankruptcy reorganization takes place.
By filing bankruptcy, all the wildfire lawsuits will be immediately put on hold and consolidated in bankruptcy court, the Associated Press reports.
The bankruptcy announcement comes days after PG&E was cleared of wrongdoing in the 2017 Tubbs Fire, which killed 22 people in Sonoma county. California fire investigators found that the fire was caused by a private electrical system, not by PG&E. The company's decision to pursue reorganization "took into account PG&E's longstanding belief based on available evidence that its equipment did not cause the Tubbs Fire," the company said.
Copyright 2019 NPR. To see more, visit https://www.npr.org.
