PG&E Loses Fight Over Fire Policy That Led to Its Bankruptcy
Gluggo
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PG&E Loses Fight Over Fire Policy That Led to Its Bankruptcy
Let’s Pray that the victims and our members here impacted by the fire get their day in court! I am sure the SLIME BAG LAWYERS HAVE MORE TRICKS UP THEIR SLEEVES!
Bloomberg Steven Church and Mark Chediak,Bloomberg 1 hour 27 minutes ago
(Bloomberg) -- PG&E Corp.’s latest attempt at escaping the California policy that saddled the power giant with billions of dollars in wildfire liabilities, pushed it into bankruptcy and led to the ousting of its chief executive officer has failed.
U. S. Bankruptcy Judge Dennis Montali on Wednesday sided with wildfire victims, who said PG&E is subject to a legal doctrine known as inverse condemnation that holds utilities strictly liable for covering the costs of blazes linked to their equipment -- regardless of whether they were negligent. PG&E had argued that it shouldn’t be subject to the rule because it’s owned by investors, not taxpayers.
PG&E blamed inverse condemnation for its downfall. California’s largest utility filed for Chapter 11 while facing an estimated $30 billion in liabilities tied to wildfires that its power lines were blamed for igniting in 2017 and 2018. The state is one of the few places -- if not the only -- in the world that holds its power companies liable in this way.
The policy has been cited as one reason Warren Buffett’s Berkshire Hathaway Energy and other potential PG&E buyers aren’t making bids. PG&E’s former CEO, Geisha Williams, spent months fighting the doctrine to no avail and was ultimately ousted, just weeks before the company filed for bankruptcy.
In deciding that PG&E is subject to inverse condemnation, Montali determined that the doctrine isn’t limited to public agencies and said the California Supreme Court would “reach the same conclusion.”
The company’s shares fell 1.3% to $7.45 in after-markets trading on Wednesday.
At stake is the bill for the second-most destructive fire in California history, the 2017 Tubbs fire, which killed more than 20 people and destroyed at least 5,600 buildings. Claims could top $10 billion, “even though CalFire determined that PG&E equipment did not ignite the blaze,” the company argued in court papers.
PG&E had said that inverse condemnation was originally developed with government-run agencies in mind -- a means for them to raise rates or taxes and spread around the costs of a disaster caused by the failure of a water line, for example. Since PG&E doesn’t levy taxes and can’t hike rates without regulatory approval, the company said, the doctrine shouldn’t apply to its case.
Some Limits
“Since at least 1894, Californian courts have not limited the application of inverse condemnation to public entities,” Montali said in his decision Wednesday. He also noted that California’s legislature has refused PG&E’s pleas to restrict the policy and said he has no reason to believe that the California Supreme Court would “step up and do it.”
He did, however, say the doctrine doesn’t extend beyond property damage and is subject to some limitations.
Montali’s ruling comes as the company and a committee representing wildfire victims are getting ready for a trial that will decide how much PG&E must pay to compensate residents and businesses hurt by fires traced to company equipment. Even with a victory, PG&E would’ve still been on the hook for tens of billions of dollars in wildfire damages that critics claim were caused by negligence.
The victims’ committee argued that PG&E must be subject to the inverse condemnation doctrine because California courts have consistently ruled that it applies even to investor-owned utilities.
State officials said in a report earlier this year that inverse condemnation increases the danger that other utilities will also go bankrupt. But when lawmakers had the chance to eliminate the doctrine, they refused to rewrite the California law.
The case is PG&E Corp. 19-bk-30088, U.S. Bankruptcy Court Northern District of California (San Francisco)
Comments
Whatever the outcome of the P,G&E bankruptcy is, I have no doubt that the monies paid to the victims of the fires of 2017, 2018 and 2019 will eventually be passed on to the customers of P,G&E in the form of rate increases approved by the California PUC and/or to California's taxpayers.
Just the way it is.
This
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Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
Doubt this will have any impact on the price of my coins. Maybe gump can bail them out. Congrats!
The whole worlds off its rocker, buy Gold™.
The investors/owners of PG+E are screwed and the folks in California are about to see the 1st state owned electric company. I find it hard to see how anyone would think it's a good investment in a service industry in such an over regulated state. Californians....watch out for astronomical power bills in your near future(or higher taxes or both).
I feel for all the folks effected by the fires but I would wager there is no way PG+E could make a profit and maintain their equipment to avoid fires in these situations. Probably the only way to do that would be to bury all the power lines.
Does anyone know if the Govt. regulates what PG+E can charge for power?
I live in So Cal and have an electric car and solar is being installed shortly. That’s the present and future.
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Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
While I like what @amwldcoin has posted, this topic is not numismatic and it has the high potential to deteriorate into a Left versus Right free-for-all.
This is by no means the end...rather the beginning of a long and torturous battle, that will eventually end up with consumers paying the bills....
Cheers, RickO
Good for you Mark. For full transparency, I suspect the car and solar were heavily subsidized by the government - hence with taxpayer funds. My point is not to be critical, but to point out that when it comes to energy, there are several ways to pay for it. If I recall correctly, California has the highest solar installed capacity with North Carolina (where I reside) a distant second.
In the future, I hope we are fair to the taxpayers as we move away from fossil fuels.
“In matters of style, swim with the current; in matters of principle, stand like a rock." - Thomas Jefferson
My digital cameo album 1950-64 Cameos - take a look!
I'm thinking of getting an electric car, too.
Think of the money I'll save by getting only halfway to coin shows.
For sure it’s heavily incentivized. For my wife the HOV Lane is a must for her commute plus that thing goes 0-60 in 4.5 seconds. Her building at work has a charger. Our house has a charger for the weekends. As for the solar I’m going to sell my extra electricity to topstuf at the AARP rate
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Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
The hell you will! We're just moving in!
All you folks with Solar Powered homes, what is the cost for a house storage battery? Solar power is only good when the Sun shines .. what happens when it's dark & the power grid is shut down?
We will keep the light on for you ( powered by solar)
Don’t mind the guard dog
Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
This thread is not about coins and should be removed.
Will PG&E take coins for payment?
It is big dog on the leather couch related, though, and that makes it all right!
It is really tough living in California as our Endless Summer is about to end and the Tuna left.
Time for some flooding and mudslides
Storm Clouds are already covering the California sun ......