PG&E and its main operating subsidiary, the San Francisco-based power and gas utility Pacific Gas and Electric, have filed for bankruptcy protection after being threatened with billions in potential liabilities following the recent wildfires in California.
Image: PG&E seeks bankruptcy protection following California wildfire claims. Photo: courtesy of Robert Linder/Freeimages.com.
Under Chapter 11 of the US Bankruptcy Code, PG&E and its subsidiary have filed voluntary petitions in the US Bankruptcy Court for the Northern District of California.
The company is seeking court approval to get $5.5bn in debtor-in-possession (DIP) financing to support its operations and ongoing safety initiatives to address wildfire threat.
After its approval, the DIP financing is expected to give PG&E the required capital to ensure essential maintenance and continued investments in safety and reliability through the duration of the Chapter 11 cases.
The utility said that it will stay committed to support the orderly, fair and expeditious resolution of its liabilities emerging from the wildfires in 2017 and 2018.
PG&E said that it will work with customers, regulators, policymakers, civic leaders, the financial community and other important stakeholders to look into alternatives to provide for the safe delivery of natural gas and power. It will also work along with the various parties on developing new safety solutions in an environment threatened by climate change.
The company said that it will assist its customers and communities affected by wildfires in Northern California while continuing with its efforts on restoration and rebuilding.
PG&E interim CEO John Simon said: “Our most important responsibility is and must be safety, and that remains our focus. Throughout this process, we are fully committed to enhancing our wildfire safety efforts, as well as helping restoration and rebuilding efforts across the communities impacted by the devastating Northern California wildfires.”
Pacific Gas and Electric, which was formed in 1905, delivers natural gas and electricity to nearly 16 million people in northern and central California. The company has a workforce of nearly 20,000 employees to handle the transmission and delivery of energy.
It boasts of having 171,686km of power distribution lines and 29,718km of interconnected transmission lines. As far as the gas service is concerned, Pacific Gas and Electric has 67819km of natural gas distribution pipelines and 10360km of transmission pipelines.