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California utility company PG&E Corp is exploring filing some or all of its business for bankruptcy protection as it faces billions of dollars in liabilities related to fatal wildfires in 2018 and 2017, people familiar with the matter said on Friday.
The company is considering the move as a contingency, in part because it could soon take a significant financial charge for the fourth quarter of 2018 related to liabilities from the blazes, the sources said.
A bankruptcy filing is not certain, the sources said. The company could receive financial help through legislation that would let it pass on to customers costs associated with fire liabilities, the sources said. But that is just a possibility, they said, so bankruptcy preparations are being made.
(Score: 2) by julian on Monday January 07 2019, @06:50AM (2 children)
Just great, can't wait for my power bill to go up. Either they pass the fire damage costs onto me, or they go bankrupt, sell off, reconstitute, and pass the costs onto me.
Good thing solar is going on my roof next year.
(Score: 2) by RS3 on Monday January 07 2019, @07:44AM
Have you looked into storage, like a PowerWall?
(Score: 2) by Phoenix666 on Tuesday January 08 2019, @06:57AM
On the bright side, the higher the utility jacks up the prices the quicker the break-even for you becomes. I dunno if California has net metering now, but if they do you will enjoy selling your excess power back to the grid such that they have to cut you a check every month.
I know I would; I'd use the proceeds to send them holiday cards with inserts of me showing them the full moon.
Washington DC delenda est.
(Score: 2) by MichaelDavidCrawford on Monday January 07 2019, @06:56AM (1 child)
It collects a fee specifically for cutting trees back from power lines, but I know of at least one other case of causing a major fire because she didn't actually trim anything back that year.
Yes I Have No Bananas. [gofundme.com]
(Score: 1, Offtopic) by realDonaldTrump on Monday January 07 2019, @12:36PM
Nutty Former Governor Jerry Brown refused to allow the Free Flow of the VAST amounts of Water coming from the North. It is being, very foolishly, diverted into the Pacific Ocean. Can be used for fires, farming and everything else. Think of California with plenty of Water -- Nice! Fast Federal govt. approvals. Must also tree clear to stop fire from spreading. Trust me, we have many Companies that can do a great job of clearing that one out. And turning it into magnificent Paper & Lumber!!!
(Score: 1, Interesting) by Anonymous Coward on Monday January 07 2019, @07:01AM (2 children)
From an investor's standpoint, their stock is a fantastic example of how even stodgy old utility stocks aren't foolproof. Stop loss or better yet hedges based on options should be a consideration with any stock. Diversification can also help. This isn't the first time PGC has been in trouble. It bounced back the last time. They might not be so lucky this time. The "widows and orphans" who depend on steady dividend checks will be OK if this is less than 1% of their portfolio as it often is with a diversified mutual fund. OTOH, if you had all your eggs in this basket and you were "naked when the tide went out", you have only yourself to blame.
(Score: 2, Interesting) by realDonaldTrump on Monday January 07 2019, @12:40PM
So true, the smart (rich) folks always Diversify. We love Diversity!!!
(Score: 1) by khallow on Monday January 07 2019, @02:49PM
PG&E was a bad bet from 2000 on due to the California electricity crisis (for which it almost went bankrupt) and has huge pension liabilities. Even the wildfire angle isn't new, they had the same problems in previous years. Anyone still invested hasn't been paying attention for a long while.
That's the thing about stodgy stocks, they're not foolproof, but you can see the end coming a long ways off.
(Score: 3, Insightful) by bradley13 on Monday January 07 2019, @07:20AM (8 children)
It's possible that PG&E is at fault for one or more fires. It is equally possible that they are not. More to the point: PG&E provides the most obvious "deep pockets" for people to go after. People with inadequate insurance, or who failed to cut trees back from their property, or whose houses were built in areas where they were always going to be at risk.
There has been a lot of discussion of forest management. The forests in question burn - that's part of their natural lifecycle. Forest management gives you the choice between lots of not-so-intense fires, or occasional total burnouts. The best forest management might well set the forest deliberately ablaze every year or two. But this would freak out the greenies, who fail to understand that fires are part and parcel of the nature they claim to love.
Everyone is somebody else's weirdo.
(Score: 0) by Anonymous Coward on Monday January 07 2019, @07:52AM
When the fire is started by improperly maintained power lines then yeah, we can blame PG&E. Unless you're personally gonna come rake our forests I don't wanna hear the excuses.
(Score: 1, Interesting) by Anonymous Coward on Monday January 07 2019, @08:15AM
actually, ut is the "greenies" who advocate for more managed small fires.
It will be the property owners who balk at it, whether they are simply home owners, ranchers or resource owners & lessees (Plum Creek, Simpson, Weyerhauser, et al.), The tree owners will be unhappy if it gets mandated on their properties or areas where they might have timber contracts.
Throw in more than a few "let local people manage things" people...
(Score: 2) by VLM on Monday January 07 2019, @01:22PM (2 children)
Not disagreeing with any of that, but I'd also throw the regulators on the pyre, as its the sole purpose of their jobs to ensure this stuff gets done correctly.
PGE is, or was, a hyper regulated public utility, not some kind of unregulated hipster food truck or robber baron railroad from 150 years ago.
(Score: 1) by khallow on Monday January 07 2019, @03:15PM (1 child)
(Score: 1, Interesting) by Anonymous Coward on Monday January 07 2019, @07:45PM
If it wasn't for their gas lines (which they had a spate of blow up here in Sacramento a few years back..) Sacramento County would be SMUD only. And you know what? We like it that way. SMUD has managed to keep electricity prices down compared to the nearby PG&E counties for DECADES.
They may be on the decline now, but given PG&E's questionable maintenance of their gas lines here, I am not sure if anyone really wants them handling their electricity either. Maybe with the current financial circumstances it will be time to politically revisit the requirement to have gas lines plumbed to your house. Eliminating those and moving to solar would make a huge difference for a lot of people in the region, bills-wise.
(Score: 2) by bob_super on Monday January 07 2019, @05:55PM
> The best forest management might well set the forest deliberately ablaze every year or two.
You like Mojave ? Because this is how you get Mojave.
Without humans around, temperate forests burn every 30 to 100 years, depending on location and sheer random luck.
Burn it too often, add warming, and you get soil erosion and no recovery for a decade (the mountain by me got hit by 3 years or drought just after a major fire, not much has recovered in almost 6 years).
(Score: 3, Interesting) by Magic Oddball on Monday January 07 2019, @10:34PM
The catastrophic October 2017 NorCal fires hit a part of the state that isn't densely forested by a longshot, and IIRC the Malibu region hit in 2018 was similarly non-forested. All but one of the investigations of the 2017 fires has finished with the conclusion that PG&E was responsible [sfgate.com]; the investigation into the 2018 fires so far appears to be heading in the same direction [sfgate.com]. So it's inaccurate to say that it's just as likely that PG&E wasn't at fault, especially if you throw in that negligence of their major gas lines had resulted in explosions that burned down a neighborhood in 2010 and a sheriff's gun range in 2015 [sfgate.com].
(Score: 2) by Phoenix666 on Tuesday January 08 2019, @06:54AM
Greenies in the inter-mountain West, at least, have always understood that part. Forest fires are a natural process, and you can let them burn like crazy with a hands-off approach, or try to minimize their extent with controlled burns and other measures.
It's the greenies on the East Coast or the Californian Coast who queer the conversation on it. People on the East Coast hear "forest" and think the juicy deciduous trees with rich foliage and suppose that if such trees can go up in flames, it must be because man screwed up somehow and either through mismanagement or anthropogenic climate change are destroying the Earth. They have no clue how inflammable Western coniferous forests can become in the dry heat of the summer, how resinous pines and spruces just love to go up like flares when put to flame. Californians are better than the Easterners on that score, but only a little thanks to regional migration from other parts of the West where greenies do understand the issues.
Washington DC delenda est.
(Score: 0) by Anonymous Coward on Monday January 07 2019, @06:35PM (3 children)
One should get in trouble for starting a fire. One shouldn't pay for the fact that it keeps burning out of control.
For example, liability could involve the first acre or the first day.
If you want more liability, landowners could be liable when fire spreads from their property to an adjacent property. Oh, they wouldn't like that, but it seems fair. If you fail to control fire on your property, it endangers others. Of course, as with the initial fire starter, liability doesn't go past the first acre or day.
(Score: 3, Insightful) by sjames on Monday January 07 2019, @07:29PM
So if a truck rear-ends you in a traffic slowdown and pushes you into the Ferrari in front of you, the truck driver gets to buy you a new Honda and you get to buy the guy in front of you a new Ferrari?
(Score: 2) by istartedi on Monday January 07 2019, @08:27PM
As counter-intuitive as it might seem, cigarettes are responsible for relatively few fire starts [accuweather.com]. I was surprised by this myself when I went looking for stats on it. Most wildfires are man-made. Smoking is bad for you. It's just not actually responsible for that many wildfires. I guess maybe the kinds of people that hike miles into the woods are more likely to get careless with a campfire than smoke.
Appended to the end of comments you post. Max: 120 chars.
(Score: 2) by Magic Oddball on Monday January 07 2019, @11:21PM
Under a rule like that, what would motivate companies like PG&E to maintain their equipment enough to avoid setting fires in the first place? The cost of the first acre or first day would be far less than maintenance costs, so financially the smart thing to do would be to continue risking thousands of people's lives & homes, not make any effort to protect them... For that matter, how are landowners supposed to prevent walls of flames moving at 40-60 mph (or as the news put it, spreading at a rate of 1 Costco per minute) from traveling across their property, short of removing every bit of vegetation from their land so it looks like a desert?
(Score: 2) by Farkus888 on Monday January 07 2019, @07:50PM
So the power company needs to pay for the people suffering and damage. They can't afford it so the government will give them the money. That money has to come from somewhere so the people, same people as in the beginning, get taxed. At least they have created a lot of government jobs in the Doing Something™ industry.
Do these people truly not understand why there are so many small government Republicans running around?