PG&E Nears $1.7 Billion Settlement in California Fire Penalties
(Bloomberg) -- PG&E Corp. is nearing a settlement with California regulators that would have it paying more than $1.7 billion in penalties for failing to properly maintain equipment involved in sparking wildfires in 2017, people familiar with the matter said.
The bankrupt California utility has agreed to invest $50 million in corrective measures. The rest of the settlement would involve money the company has already spent on maintenance and inspections that it would be barred from recovering from customers, said the people, who asked not to be identified because the information isn’t public.
The penalties are tied to a California Public Utilities Commission case in which the company’s wildfire safety practices were found to be unsafe and in violation of state rules.
PG&E said in a statement that it has been “actively engaged in settlement discussions” with the commission’s enforcement division and other parties over the past three months. The groups “require additional time to finalize the agreed-upon terms of the settlement,” the San Francisco-based power giant said. The utility commission didn’t respond to requests for comment.
A deal would eliminate some overhang for PG&E, which was forced into bankruptcy in January after its equipment was found to have ignited deadly wildfires in 2017 and 2018, saddling it with an estimated $30 billion in liabilities. PG&E has already set aside the vast majority of the funds it would need to cover the penalties, people familiar with the situation said.
The enforcement division of California’s utility commission and PG&E had already said on Friday that they had reached an agreement in principle on the penalty case, but they fell short of outlining the details of the arrangement.
The settlement does not cover any potential violations tied to wildfires that broke out in 2018, including the Camp Fire, which was started by a PG&E power line and was the deadliest in California history.
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