California Wildfire Claims Leads to PG&E Bankruptcy Filing
Due to claims related to the recent deadly Wildfires, Pacific Gas and Electric has been forced to file for bankruptcy protection. PG&E, California's largest power company, has been linked to a number of wildfires that have caused billions of dollars in damages and a significant number of casualties.
The company officially announced on Tuesday that it has submitted a Chapter 11 bankruptcy filing. The company's CEO, John Simon, mentioned in a statement that they are in the process of making a lot of changes within the company. The goal of the company's restructuring is for them to provide a safer and more reliable service for all their customers moving forward. The CEO also assured customers that they will be maintaining all of their current services throughout the bankruptcy process.
PG&E has been at the center of several deadly wildfires in California. The company's lack of maintenance and its numerous safety violations have been linked to several of these tragedies. This includes the recent wildfire that started near Camp Creek Road. The event, most commonly known as Camp Fire, was the deadliest wildfire in California history to date and the sixth-deadliest in the United States overall.
The fire claimed the lives of 86 people and it destroyed more than 14,000 homes. The blaze also took down hundreds of buildings and establishments, with total damages estimated to be around US$16.5 billion. A power line owned by PG&E is believed to have been the source of the blaze. The power line reportedly came in contact with foliage around it, which immediately caused an outage in the area right before the blaze began.
An investigation was immediately launched right after the incident. Investigators found power equipment and destroyed power transmission lines owned by PG&E within the burn area where the fire originated. PG&E was also recently linked to a series of wildfires in 2017. Wildfires during that year claimed the lives of 44 people. State investigators found that the company had violated a lot of its safety codes, including brush clearance requirements and other safety regulations.
PG&E reportedly had to pay around US$7 billion in damage claims because of the fire. The bankruptcy filing will allow the company to continue paying for damages, while still staying in business. It will also allow them to shed some of their debt while maintaining their liquidity. The company also stated that it was in the process of getting a debtor-in-possession loan of around US$5.5 billion.