PG&E CEO Steps Down Amid Reports of Bankruptcy Preparations

Daniel Fowler
January 14, 2019

General counsel John Simon will take the helm in the meantime.

PG&E Corp, the biggest US power utility, said on Monday it is preparing to file for Chapter 11 bankruptcy for all of its businesses as it faces potentially crushing liabilities linked to catastrophic wildfires in 2017 and 2018. It has access to about $1.5 billion in existing cash.

The Chapter 11 filing, the second in the company's history, will allow PG&E to keep operating while it sorts out its ever-growing debt load. Still, the utility vowed to provide "safe natural gas and electric service to customers." .

PG&E said Monday that Williams will receive severance. Investigators have been probing whether the power giant's equipment ignited the fire, along with its potential liability for blazes that devastated Northern California's wine country in 2017 - costs that "could exceed US$30 billion", according to the filing. "We believe John is the right interim leader for the company while we work to identify a new CEO". Shares were trading at almost $50 before the company disclosed that a faulty transmission tower may have caused the Camp Fire. But PG&E has suggested it may be responsible.

PG&E serves 5.4 million electric customers and 4.3 million natural gas customers in northern and central California. The utility said bankruptcy was the best way forward for employees and those who are claiming losses from wildfires that may have been caused by its power lines.

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Pacific Gas & Electric announced Sunday evening that CEO Geisha Williams will step down amid the fallout from a spate of deadly wildfires that may have brought the California utility to the brink of bankruptcy.

PG&E faces widespread litigation, government investigations and liabilities that could potentially reach $30 billion, according to the company, accounting for damage from fires past year and in 2017. He said in a later interview that the announcement would involve appointments to the California Public Utilities Commission, the state's grid operator and to a commission established by legislature to explore wildfire issues.

The company does not expect bankruptcy to interfere with providing its customers with power and other services, the company said in a statement Monday.

Williams was CEO for less than two years, but she had been with PG&E since 2007. It is the deadliest and most destructive wildfire to have occurred in the state.

"PG&E faces extensive litigation and significant potential liabilities resulting from these wildfires". The Camp Fire that started in early November destroyed the town of Paradise, and killed at least 86 people.

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