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PG&E completes $13.5B settlement over wildfire claims

Late last week northern California utility Pacific Gas & Electric Co., along with its parent PG&E Corp., agreed to a $13.5 billion settlement with victims of several deadly wildfires in recent years.

The agreement settles all claims with the Official Committee of Tort Claimants and attorneys representing individuals who suffered losses from the 2015 Butte Fire, 2017 Northern California Wildfires and 2018 Camp Fire, according to the PG&E announcement. These fires took more than 100 lives and destroyed thousands of acres and structures.

The agreement is awaiting federal bankruptcy court approval. PG&E sought Chapter 11 reorganization earlier this year after wildfire liabilities topped more than $11 billion.

A California state investigation determined that downed PG&E transmission equipment helped spark at least one of the fires. Fierce coastal winds and dry weather laid the groundwork for the blazes.

“From the beginning of the Chapter 11 process, getting wildfire victims fairly compensated, especially the individuals, has been our primary goal. We want to help our customers, our neighbors and our friends in those impacted areas recover and rebuild after these tragic wildfires,” said CEO and President of PG&E Corporation Bill Johnson.

Johnson, the former Tennessee Valley Authority president, joined the company earlier this year.

“There have been many calls for PG&E to change in recent years. PG&E’s leadership team has heard those calls for change, and we realize we need to do even more to be a different company now and in the future,” he added. “We will continue to make the needed changes to re-earn the trust and respect of our customers, our stakeholders and the public. We recognize we need to deliver safe and reliable energy service every single day—we’re determined to do just that.”

PG&E has now made three major settlements in its Chapter 11 case. Those totaled $1 billion with cities, counties and other public entities, as well as the $11 billion agreement with insurance companies and other entities over claims for the 2017 and 2018 fires.

The utility previously filed a wildfire safety plan with state regulators. Earlier this year, PG&E joined other California utilities Southern California Edison and Sempra Corp. on contributing to a $21 billion state wildfire fund which could protect them in the event of future devastating wildfires.

PG&E has received more than $12 billion of equity backstop commitments to support the settlement.