Pacific Gas and Electric Co. (PG&E) announced last week that it had reached an $11 billion settlement on about 85% of claims tied to wildfires across Northern California in 2017 and 2018.
The San Francisco-based combination utility giant’s reorganization will be amended to factor the claims brought by insurance companies, and need approval by the federal judge overseeing its multi-billion-dollar Chapter 11 bankruptcy case. Unresolved claims worth billions of dollars must still be settled in the bankruptcy process.
"PG&E expects to amend the plan to incorporate the terms of the settlement after completion of the definitive documentation for the settlement," said PG&E spokesperson James Noonan, referring to the insurance claims. "The settlement is to be implemented pursuant to PG&E's Chapter 11 Plan of Reorganization and subject to confirmation of the plan by the U.S. Bankruptcy Court for the Northern District of California in San Francisco."
Since filing for Chapter 11 protection in January, PG&E has reached one other settlement -- $1 billion for Northern California towns ravaged over the past four years by wildfires found to likely have been caused by electric utility equipment.
Proceedings for the third and final major group of wildfire claims are now pending in both the federal district and state courts, according to Noonan.
PG&E CEO Bill Johnson said the utility and holding company was "working to resolve the remaining claims of those who have suffered, and we are also focused on safely and reliably delivering energy to our customers, improving our systems and infrastructure, and continuing to support California's clean energy goals."
Victims' groups and elected officials have expressed skepticism, reflecting a loss of public trust in PG&E. Consumer groups have alleged bailouts for the utility company from state programs and the bankruptcy court are harmful to customers.
Separately, the California Public Utilities Commission (CPUC) authorized a $100 million resiliency program on Sept. 12 to support various efforts, equipment and programs to prevent wildfires from occurring. The program will target districts with "extreme" and "elevated" risks of fires, designated as tier 2 and tier 3 districts. The program focuses on low income and disadvantaged customers in those high fire-risk areas. "They are the most at-risk when power is shut off from the grid," said CPUC Commissioner Clifford Rechtschaffen.
The program sets aside $10 million in funding for pilot programs in the central San Joaquin Valley, where CPUC Commissioner Martha Guzman Aceves said self-generation incentive programs have "fallen short" in the past.