Dive Brief:
- Pacific Gas & Electric announced this morning that it has reached a $1 billion settlement with 18 cities, counties, districts and public agencies, that were impacted by the 2015 Butte Fire, 2017 Northern California wildfires and 2018 Camp Fire.
- According to media reports, the destroyed town of Paradise, Calif., will receive $270 million from the settlement, and more than $250 million will go to Butte County.
- The settlement is contingent on approval from the bankruptcy court overseeing PG&E's Chapter 11 reorganization proceeding. The agreements also do not include individuals or business owner claims, which are expected to number in the thousands.
Dive Insight:
Shares of Pacific Gas & Electric were trading about 3% higher this morning, as the utility announced the settlement — but cautioned it represents only a "first step."
The payments would be made as part of PG&E's plan of reorganization. The utility said a filing date "remains uncertain," though it intends to complete the process "as expeditiously as possible."
PG&E declared bankruptcy following the 2017 and 2018 fire seasons, facing billions in liability.
The company got some good news recently, when the bankruptcy court ruled the Federal Energy Regulatory Commission does not have "concurrent jurisdiction" over its power contracts, possibly clearing the way to have above-market power purchase agreements discharged.
While dealing with restructuring, the utility is also confronting this year's fire season. PG&E earlier this month cut power to more than 22,000 customers as part of the state's new Public Safety Power Shutoff program.
All of the state's utilities are now involved with the second phase of regulators' wildfire mitigation proceeding, working to determine if plans to reduce the risk of fires sparked by electrical equipment are having the intended outcome.
