As the company warned it would do, PG&E filed for Chapter 11 bankruptcy on Monday, as the utility faces billions of dollars in liabilities for involvement in California wildfires.
Earlier this month, PG&E provided a 15-day advanced notice for filing for bankruptcy. The company indeed filed for Chapter 11 bankruptcy 15 days later.
PG&E is seeking court approval to access $5.5 billion in debtor-in-possession financing it says it has secured in order to support ongoing operations and safety initiatives. The utility also filed various motions in court relating to the company’s reorganization, include requests to continue paying employee salaries and providing healthcare and other benefits. PG&E also intends to pay suppliers in full under normal terms for the good and services they provided, the company stated in a press release.
“Through this process, we will prioritize what matters most to our customers and the communities we serve — safety and reliability,” PG&E Interim CEO John R. Simon said. “We believe that this process will make sure that we have sufficient liquidity to serve our customers and support our operations and obligations.”
Simon replaced CEO Geisha Williams, who resigned earlier this month at about the same time the company announced its intent to file for bankruptcy. Williams had served as PG&E’s CEO since March 2017.
Investigators have determined PG&E started multiple California wildfires in 2017, and the company 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 over the blaze.
PG&E says it believes the bankruptcy process will facilitate the orderly, fair and expeditious resolution of the companies’ liabilities that have arisen and will continue to arise in connection to the 2017 and 2018 Northern California wildfires. The company noted that, last week, Cal Fire released the results of its investigation into the 2017 Tubbs Fire, which concluded PG&E equipment did not cause the blaze.
In its bankruptcy filing, PG&E stated it faces damage claims over the wildfires that are estimated at tens of billions of dollars, according to The New York Times. The company stated in the filing that bankruptcy was the “only viable option.”
As of Sept. 30, PG&E had $51.7 billion in debt and $71.4 billion in assets, the company said in its bankruptcy filing.
PG&E’s stock price has fallen as low as $7.39 over the last week and is currently trading at around $14. In early November, PG&E shares were nearly $50.