PG&E submits $1.68 billion settlement agreement to Calif. regulators

California governor meets with PG&E after takeover threat
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After suggesting the state could take over ailing power company PG&E, California Governor Gavin Newsom meets with company leaders.

Pacific Gas and Electric (PG&E) has submitted a $1.68 billion settlement agreement to California regulators related to fires started by its equipment in 2017 and 2018, the company said in a news release Tuesday.

The settlement agreement, which still must be approved by the California Public Utilities Commission, proposes that PG&E pay $50 million for enhancements to its electric transmission and distribution system and also prohibits the bankrupt public utility from recovering $1.625 billion in costs associated with the wildfires from ratepayers.

PG&E has been working on a settlement agreement since August.

Among the enhancements the company will make are instituting a tree crew training and certificate program, hiring an independent wildfire safety auditor and conducting quarterly public reporting on electric maintenance work, the company said in the release.

The settlement agreement announced Tuesday is separate from and in addition to the settlements PG&E has already put forward related to the fires, including a $1 billion settlement with cities and counties, $11 billion to resolve insurance claims and a proposed agreement of $13.5 billion to settle with individual victims.

California Gov. Newsom rejected the latter settlement, saying it did not reflect a transformation of the company’s practices.

“We remain deeply sorry about the role our equipment had in tragic wildfires in recent years, and we apologize to all those affected. None of us wants to see another catastrophic wildfire in the communities we call home,” PG&E CEO and President Bill Johnson said in Tuesday’s news release. “This settlement agreement underscores our commitment to learning from the past and doing what’s right for safety in the future.”

PG&E has requested that the utilities commission approve the settlement by the end of February next year.

Power company in bankruptcy

PG&E filed for bankruptcy protection in January after coming under pressure from billions of dollars in claims tied to deadly wildfires.

The company has been criticized for the role its equipment has played in the outbreak of numerous fires in California, among them the deadliest and most destructive wildfire in state history.

An investigation by the California Public Utilities Commission’s Safety and Enforcement Division (SED) concluded that the company’s equipment helped lead to last November’s Camp Fire, which killed 85 people.

Newsom has made clear that he will only accept a bankruptcy plan that includes a restructuring of the company’s practices.

“PG&E’s chapter 11 cases punctuate more than two decades of mismanagement, misconduct, and failed efforts to improve its safety culture,” Newsom wrote. “The resolution of this bankruptcy must yield a radically restructured and transformed utility that is responsible and accountable.”

CNN’s Sarah Moon contributed to this report.