Pacific Gas and Electric Co. (PG&E), beset by a seemingly endless assortment of critics, faces the new year with the challenging task of gaining wide consensus for its proposed plan to exit Chapter 11 bankruptcy and complete numerous wildfire settlements.
Letters sent earlier in December from Gov. Gavin Newsom and legislators, as well as mounting investigations by the California Public Utilities Commission (CPUC), point to general dissatisfaction by state officials with the San Francisco-based combination utility’s proposed reorganization plan.
State Assemblymember Chris Holden, who chairs the energy and utilities committee, in a letter to PG&E CEO Bill Johnson said the utility has “failed to understand or accept the gravity” of the issues it is facing in seeking to leave bankruptcy protections. Holden asked Johnson to “immediately revisit, strengthen and reconcile” the reorganization plan with the state’s requirements outlined in Assembly Bill 1054, the wildfire mitigation legislation.
Recent actions by U.S. Bankruptcy Judge Dennis Montali are in conflict with Newsom, who has also criticized PG&E’s settlement with wildfire victims from 2017 and 2018.
PG&E spokesperson Jennifer Robison last Monday reiterated that the bankruptcy court has approved the settlement agreements resolving all major wildfire claims. A status conference in bankruptcy court is scheduled for Jan. 14 on the competing plan confirmation process.
“This brings us one significant step closer to getting victims paid so they can rebuild their lives,” Robison told NGI. “As for our overall plan of reorganization, we remain engaged in active and constructive dialogue with stakeholders. We will continue to move forward with proceedings on our plan in court and at the California Public Utilities Commission. We are committed to a safe, sound, and financially stable PG&E going forward.”
Also on Monday, Newsom issued an executive order to extend through 2020 protections for wildfire victims against price gouging in seven counties struck by major fires in 2017 and 2018. Two CPUC units and a statewide utility employees’ organization have agreed to the victims’ settlement, while several other key stakeholders have not, including The Utility Reform Network (TURN), the city and county of San Francisco, and certain other parties, according to a recent PG&E Securities and Exchange Commission filing.
More recently, PG&E settled its pending billion-dollar general rate case at the CPUC, agreeing to forego its proposed rate increase request for about half of what it was asking, $575 million.
Joining the utility in the deal were the CPUC Public Advocate’s Office, TURN, Coalition of California Utility Employees, the CPUC’s Office of the Safety Advocate, the National Diversity Coalition, the Center for Accessible Technology, the Small Business Utility Advocates and California City/County Street Light Association.
The rate case settlements set subsequent increases in 2021 and 2022 that collectively add another $685 million, moving PG&E overall revenues to close to $10 billion in 2022.
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