PG&E Expects To Pay At Least $2.5 Billion For Northern California Wildfires
SAN FRANCISCO (CBS SF) — Utility giant Pacific Gas & Electric Corporation announced Thursday it was taking a $2.5 billion pre-tax charge against quarterly earnings for its possible role in the devastating Northern California wildfires.
The announcement came in a filing with the Federal Securities And Exchange Commission and the company said it would hold an investors call later in the day to explain the charges.
In morning trading, PG&E stock was up 1.8 percent to $40.75.
Earlier this month, the state Department of Forestry and Fire Protection blamed PG&E power lines and equipment failure for 12 of the catastrophic wildfires that started in October 2017.
SEE: Lawmakers Say PG&E Talking Bankruptcy After October Wildfires
The 2017 wildfire siege killed at least 44 people and destroyed about 9,000 structures. The fires burned at least 245,000 acres across Sonoma, Napa, Mendocino and other Northern California counties.
Two of the 12 wildfires cited killed 15 people. Cal Fire announced that investigators determined the 12 fires were caused by electric power and distribution lines, conductors and the failure of power poles.
In most cases, the cause was blamed on tree limbs coming into contact with power lines. In other instances, power conductors or other equipment toppling onto the ground sparked the fires, according to Cal Fire.
RELATED: Cal Fire Ties 12 Blazes In Deadly October Firestorm To PG&E Lines
Cal Fire said the 12 fires involving PG&E equipment were:
Redwood Fire, Mendocino County – tree or parts of trees falling onto PG&E power lines
Sulphur Fire, Lake County – power pole failure; power lines and equipment coming in contact with the ground
Cherokee Fire, Butte County – tree limbs coming into contact with PG&E power lines
37 Fire, Sonoma County – electrical; associated with the PG&E distribution lines in area
Blue Fire, Humboldt County – power line conductor separates from connector, falling to ground
Norrbom Fire, Sonoma, Napa Counties – tree falling onto power lines
Adobe Fire, Sonoma, Napa Counties – tree falling onto power line
Patrick Fire, Sonoma, Napa Counties – tree falling onto power line
Pythian Fire, Sonoma, Napa Counties – downed powerline
Nuns Fire, Sonoma, Napa Counties – part of tree breaking, contacting power line
Pocket Fire, Sonoma County – part of tree breaking, contacting power line
Atlas Fire – Napa County – large tree limb, tree falling onto power line in separate locations
In a press release, PG&E said: "The ($2.5 billion) charge does not include any amounts for potential penalties or fines that may be imposed by governmental entities. It also does not include any amounts in connection with any of the other Northern California wildfires (including the Atlas, 37, Tubbs, Cascade, Maacama, Pressley and Point fires) because at this time PG&E Corporation and the utility have not concluded that a loss arising from those fires is probable."
RELATED: Congressman: 'PG&E Is In A Heap Of Trouble' After Cal Fire Report
PG&E Corporation CEO and President Geisha Williams said that recording the charge was made necessary because of the state's "flawed policy of inverse condemnation" and she called for a reform to the current policy.
"These fires were tragic and we remain focused on helping communities recover and rebuild," said Williams in a news release. "Looking forward, the state, first responders and California's utilities are all in agreement that we must work together to prevent and respond to wildfires and enhance infrastructure resiliency. Years of drought, extreme heat and 129 million dead trees have created a 'new normal' for our state that requires comprehensive new solutions."
