Gov. Gavin Newsom slams PG&E’s bankruptcy plan

December 16, 2019

Gov. Gavin Newsom

By JOSH FRIEDMAN

California Gov. Gavin Newsom voiced strong opposition to PG&E’s plan to emerge from bankruptcy, raising questions about the viability of the company’s reorganization effort.

In January, faced with approximately $30 billion in wildfire-related liabilities, PG&E filed for Chapter 11 bankruptcy. The company recently announced a $13.5 billion settlement that would resolve all claims related to the deadly and destructive Northern California wildfires that PG&E allegedly caused.

On Friday, Newsom authored a letter to PG&E CEO William Johnson disapproving of the utility’s reorganization plan. Newsom argued PG&E’s plan does not put the company in a position to provide safe, reliable and affordable electricity to customers.

“The state remains focused on meeting the needs of Californians including fair treatment of victims – not on which Wall Street financial interests fund an exit from bankruptcy,” Newsom wrote.

California’s governor also criticized the utility for causing recent blackouts across the state as a preemptive measure to prevent wildfires. Likewise, he demanded changes to PG&E’s board of directors.

Newsom stated in the letter to Johnson that PG&E falls woefully short of complying with AB 1054, the state’s new wildfire fund law. AB 1054 allows utilities to tap into a pool of state funds in order to pay wildfire-related claims.

The governor argued PG&E’s reorganization plan is not financially viable without AB 1054 funds.

Under AB 1054, the California Public Utilities Commission must review PG&E’s reorganization plan. If the PUC does not approve of the plan, PG&E’s bankruptcy process could drag on.

PG&E’s stock plunged from above $11 to below $9 when markets opened Monday morning.


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Humperdinck

PG&E did an end-around Newsom today and made him a eunuch. So, this CalCoastNews article is a day late and a dollar short.

https://www.cnbc.com/2019/12/17/reuters-america-update-2-u-s-judge-approves-pge-deal-with-california-wildfire-victims-stock-jumps.html

Here’s a laymans view of the wildfires impact on the state on YouTube and how the state green policies, assembly bills, governors, CPUC & PG&E got us to this point: https://www.youtube.com/watch?v=7WAB5cflHBI


nunsense

if the state runs the utility and a fire starts, who are they going to sue (and blame)? when the Oroville dam nearly burst which would have had devastating results – not one lawsuit – now if that had been a PG&E dam, ….


HarryMalone

Newsome says $13.5 billion is not enough.

Remember all PGE settlements will be eventually be paid one or the other by the rate payers.


kayaknut

So Governor Newsom and other elected allow the PUC to cozy up to PG&E which allows PG&E to do whatever it wanted for decades and now Gavin complains about what PG&E’s actions, or lack of, has caused. Who is surprised?


IDBOUND

Not only is Californias elected officials happy with running out major corporations who provided thousands of jobs … Now they want to run PGE out of business and take over ownership …When our road system isn’t even up to par ….PGE can’t be everywhere so it doesn’t hurt for PGE customers when out for a walk to look up at trees near power lines to look at wires and look for leaking power transformers etc and place a call to PGE repair division ….At one of my Calif places a officer told if I look in a straight line there is over 1700 illegal mariauna grows those indoor grows are consuming 50 to 60 kva thru a 25 kva transformer and 60 to 100 or more thru a 50 kva transformer ….that is also what causes fires overheated lines , overheated leaking transformers etc etc ….Then to top it off there is thousands of solar systems back feeding into grid etc etc ….If the state controllers were actually worried about the grid ….the state would create a grid inspector division and bill PGE for services rendered …not try to run PGE out of business and then takeover it ….If we don’t be careful what we wish for we might be buying power from a Chinese owned grid


sewerplantbob

Yes, the state has done such a good job running DMV. I can imagine how they would run an electric company.


LameCommenter

Doesn’t the state already run the Calif-ISO and via the Public Utilities Commission run the power utilities in a regulatory fashion? And just as a data point, PGE rates here are twenty two cents for the stingy few hundred kilowatt-hours you are supposed to get by on monthly, then twenty nine cents, then into the stratosphere.


By comparison, for example in Central Texas known as Hill Country, the co-ops, utilities and aggregator/community choice types deliver power for about ten and a half cents, generally no tiers, no penalties, just a $ 33 or so meter charge and all the juice you can consume without tiers or socially engineering your electricity use.


Newsom is a disaster.


kayaknut

Not to worry, if your electricity goes out just make an appointment for a service crew, just too bad the only appointment date/time you can get is two months away.


Russ J

Au contraire my friends. The victims will be paid, the lawyers will make sure of that. Gavin Newsome is actually on the right side of this issue. Our California PUC and PG&E have had an incestuous relationship forever. PG&E is actually a convicted felon corporation from blowing up a San Bruno neighborhood and taking a few California citizens with it. The issue Gavin Newsome has trouble with; is making bond holders solvent and profitable while the tax payer/rate payer loses. As whacky as it sounds, very wealthy, I’m talking uber wealthy bond fund holders stand to make a tidy profit from buying discounted PG&E municipal bonds and then getting a bailout in bankruptcy court. Case in point; those bonds dropped in value today. As much as I hate government run anything, it’s time to call in the cops and police this criminal utility that put share holders and green energy investment ahead of peoples safety: San Bruno, Camp Fire, Santa Rosa, Montecito (So Cal Edison) and on and on and on. Over one hundred people killed. Unfortunately, once PG&E becomes insolvent, the rate payers will own all the liability.


TKG

That’s a heck of a Christmas present from Newsom to the victims of wildfires who would have been paid by the PGE plan but won’t be now. PGE has major challenges across the business with rolling blackouts, wildfires, and exploding pipelines, but Newsom making noises about the state taking over their responsibilities is flat out scary. How would you like state government to take over PGE and have the California taxpayers shoulder the liabilities that PGE is responsible for? NO THANK YOU!


oldtimer

Keith, the governent runs the military, a size that trumps PGE by hundreds of billions, being one of the largest business entities on earth. And they do it well. If Gavin can negotiate a higher payout or seize the entity; bankruptcy is a joke fyi, legal stealing, then you sir are insulting the families whom lost life, loved ones, and land. So it’s ok for the government to run a military, have an FBI, CIA, NSA, DOD, Dept of Ag, Department of health, NASA, but not a utilities company or medicine for all? Keith, should I list more government run entities with “socialist” agendas? The government can run CSU, UC, fire, police, health, but heavens forbid a utility company and screwing us taxpayers over bankruptcy? And keith, we already shoulder taxes for PGE, they use our social infrastructure and our fire dept, pd, all of Our resources and we foot the bill for their neglegence, damn right Gavin said f you to them, etc. So cut that out with the false narratives. If you hate the government so much, go boycott the people that keep you safe. Stop slandering our service members. Boy, i guess the government should just cease to exist in your ideological view. We can just live in caves near other people’s mansions! You’re literally hating, for the sake of hating, without any substance to your hate, and hate should only be used to save others and generate action, not opinions.


Snoid

My good man, have you forgotten how brilliantly bitchen Newsome and his minions are? Liabilities? ppffftttt…when your perfect you never make mistakes so why worry. BTW Karen or Dan. Please find a different picture of this ass. One where he might resemble a professional,not a damn game show host.


Rambunctious

Lets pile a bunch of green energy regulations onto PG&E and give them a ridiculously unreal amount of time to comply and become carbon neutral…whatever that is…and then blame them for everything under the sun and criticize their bankruptcy plan as if you had nothing to do with causing it….that’s a one party rule state for ya….