As the company potentially faces billions of dollars in liabilities for involvement in California wildfires, PG&E announced Sunday it plans to file for Chapter 11 bankruptcy. Additionally, the utility’s CEO Geisha Williams resigned.
While investigators have determined PG&E starting multiple California wildfires in 2017, PG&E is facing allegations that its equipment started the 2018 Camp Fire, the deadliest and most destructive blaze in state history. The company could face murder charges if found responsible for starting the Camp Fire, and it is already facing numerous lawsuits.
“PG&E expects that the Chapter 11 process will, among other things, support the orderly, fair and expeditious resolution of its potential liabilities resulting from the 2017 and 2018 Northern California wildfires,” the utility stated in a press release.
On Sunday, PG&E provided a 15-day advance notice for filing for Chapter 11 bankruptcy. The company said it expects to have approximately $5.5 billion of committed debtor-in-possession financing when it files for bankruptcy. The financing will provide PG&E sufficient liquidity to maintain its ongoing operations, the company stated.
Electric and natural gas service are expected to continue without interruption during the bankruptcy process. Also, PG&E employees are expected to continue receiving their normal pay and benefits, the company said.
The Chapter 11 process will allow the utility to work with regulators and policymakers to determine the most effective way for customers to safely receive electricity and natural gas in the long-term.
Williams, whose resignation was announced Sunday, had served as PG&E’s CEO since March 2017. She was replaced by John R. Simon.
Prior to being appointed interim CEO, Simon served as executive vice president and general counsel for PG&E. Simon has been with the company since 2007.
Richard C. Kelly, the chair of the PG&E board, said the company’s directors believe Simon is the right interim leader while they search for a new CEO.
“Our search is focused on extensive operational and safety expertise, and the board is committed to further change at PG&E,” Kelly said in a statement.
PG&E shares closed last week at $17.59, down from nearly $50 in early November.