One by one, bondholders, insurers and most wildfire victims have signed onto PG&E’s plan for emerging from bankruptcy reorganization. Only Newsom now stands in the company’s way — and he has threatened a public takeover if big changes aren’t made at California’s largest utility.
By Cal Matters
Calling the bankruptcy of California’s largest investor-owned utility a “godsend,” Gov. Gavin Newsom has threatened a public takeover of Pacific Gas & Electric unless it can transform into a provider of affordable, reliable, clean and — above all — safe energy. That means no more ferocious wildfires sparked by PG&E equipment. That means no more fire-season blackouts that drag on for days or weeks, disrupting the state’s $3 trillion economy.
It has been a little over a year since PG&E sought Chapter 11 protection, fearful that it might be locked out of the capital market by mounting wildfire liability and a fire-prone, climate-driven future. Reorganization was intended to give the company breathing room, keep utility workers employed — and keep Northern California’s lights on.
PG&E hasn’t been without lifelines. Last year, the state created a fund to help utilities deal with the rising risk of wildfires. If PG&E emerges from bankruptcy by June 30, it can qualify for that assistance — something it desperately needs to get out of a hole created by nearly $25 billion in settlements with wildfire victims and insurers. One by one, as the current reorganization has proceeded, most of those victims, along with insurers and bondholders, have signed on to PG&E’s plan, in order to be repaid.