PG&E Update: California Utility May Face More Wildfire Challenges Ahead

Following its Chapter 11 bankruptcy filing in January, PG&E (PCG.F) has come under fire for the safety measures it utilized to prevent wildfires in California. While the company moves to develop a more stringent wildfire protection plan for the future, it may be facing another hurdle as the state’s governor, Gavin Newsom, is considering overhauling the California Public Utilities Commission, The Wall Street Journal reported.

PG&E, along with the other utilities in the state, are required to have a wildfire action plan in place as part of a 2016 law. The Commission has been criticized for its lack of enforcing the law, which Newsome hinted during a meeting in Sacramento last week, could mean changes to management as wildfire season nears, The Wall Street Journal reported.

With California considering ways to cover the liabilities of the wildfires in the state, it could move for the breakup of PG&E or require investor-owned utilities to shed or split up its natural gas or electric power services, CNBC reported. Edison International and Sempra Energy also provide power services in the state.

PG&E is the largest electric utility in California that may have liabilities for the 2018 Camp Fire. The utility said in a regulatory filing that it believes it’s “probable” that its equipment was the source of the wildfire. The 2018 Camp Fire destroyed 10,000 homes and killed 86 people. It is believed to be the deadliest wildfire in the state’s history.

Shares of PG&E stock were up 0.06 percent as of 2:57 p.m. ET on Tuesday.