California's largest utility, facing up to $30 billion in potential liability for recent California wildfires, filed for Chapter 11 bankruptcy protection at midnight Tuesday. Pacific Gas and Electric Corp's board of directors approved the plan to file at a meeting Monday evening. PG&E announced its intention to file two weeks ago.
Filing for bankruptcy essentially ensures the company can continue to operate and its customers will get power, but doesn't assure any of the fire victims will get compensation -- or that ratepayers won't get hit with part of the bill, CBS San Francisco and CBS Los Angeles say.
The filing enables PG&E to freeze its debts and continue operations while developing a financial reorganization plan. The company serves 16 million homes and businesses in Northern and central California.
PG&E said it would seek $5.5 billion in loans to get it through the bankruptcy period.
At a noisy meeting punctuated by protests earlier Monday, the California Public Utilities Commission in San Francisco voted to let PG&E borrow up to $10 billion to cover operations over that span, CBS Los Angeles explains.
At that session, activists said the company shouldn't be borrowing more money, CBS San Francisco reports.
State officials are investigating whether the utility's equipment sparked the deadliest, most destructive, the Camp Fire, which killed at least 86 people and burned down 15,000 homes in Paradise and surrounding Northern California communities in November.
Reinsurance company Munich Re says the Camp Fire was the world's most expensive natural disaster last year, with overall losses of $16.5 billon, according to the Reuters news agency.
Fire investigators also blame the utility's power lines for causing other wildfires in the state last year and in 2017.
California law compels utilities to pay for damages from wildfires if their equipment caused the blazes - even if the utilities weren't negligent through, say, inadequate maintenance.
PG&E "also filed for bankruptcy in April 2001 near the height of an electricity debacle marked by rolling blackouts and the manipulation of the energy market," the Associated Press points out, adding that, "PG&E emerged from bankruptcy three years later but obtained billions of dollars in higher payments from ratepayers."