PG&E Faces Takeover Despite Court Approved Bankruptcy

Pacific Gas & Electric’s plan for amended bankruptcy reorganization has won court approval. It also has the support of bondholders and a big majority of the victims of wildfires caused by the utility company’s equipment, and it makes some concessions to California Gov. Gavin Newsom’s demands for greater safety and accountability. But it doesn’t meet Newsom’s key demand — a structure that allows the state to take over the utility if it fails to meet future commitments. Such a structure would make it a hard sell to investors, which in turn throttles PG&E’s ability to win the financial backing it needs to emerge from bankruptcy by the June 30 deadline it must meet to gain access to the state’s $21 billion wildfire insurance fund. That is seen as a key condition for its future stability. The public is behind Newsom because of the widely-shared perception that PG&E is to blame for several deadly disasters including the 2010 San Bruno gas pipeline explosion and the 2018 Camp Fire, as well as the multimillion-customer power outages last fall. A state senator is sponsoring a bill that authorizes the use of eminent domain to acquire the assets and ownership of a utility if it “has been convicted of one or more felony criminal violations of laws enacted to protect the public safety within 10 years” — language tailored specifically to PG&E’s 2017 conviction on six criminal charges related to the 2010 San Bruno disaster.