SACRAMENTO, Calif. — A federal bankruptcy judge approved two PG&E settlements Tuesday totaling nearly $25 billion to help pay homeowners, businesses and insurers for the damage caused in massive and deadly Northern California wildfires in recent years.
The settlements are a big step forward for PG&E as it tries to get out of bankruptcy before the end of June 2020 in order to tap into California’s new wildfire fund — money that will be crucial to keeping the utility in business.
Still, the investor-owned utility must convince Gov. Gavin Newsom that its plan to emerge from bankruptcy is viable, which must do to receive the wildfire fund money its plan relies so heavily on.
WATCH ABC10'S INVESTIGATION: "Fire. Power. Money. California’s burning crisis and how it’s going to cost us all."
PG&E filed for bankruptcy in January because it was facing at least $30 billion in potential damages from lawsuits after the utility’s equipment started massive Northern California wildfires in 2017 and 2018 that killed more than 100 people and destroyed the entire town of Paradise.
Last week, Newsom rejected PG&E’s plan, concluding that it did not sufficiently prove to provide safe and reliable power to its customers.
Newsom’s rejection could have destroyed PG&E’s planned $13.5 billion settlement with survivors, but the utility on Monday revised their agreement so that it would not rely on the governor’s approval.
The governor's attorneys told the judge Tuesday that he won't stand in the way of this settlement for fire survivors. But the utility must convince Newsom by next year or the settlement could still fall through.
Meanwhile, PG&E also agreed Tuesday to pay $1.7 billion in penalties to the California Public Utilities Commission for sparking fires in 2017 and 2018. The deal would spare PG&E customers from rate increases, which are already some of the highest in the country.
READ MORE:
- Davis joins list California cities pushing to make PG&E a customer-owned utility
- PG&E's wildfire deal comes with risks, uncertainty
- Wildfire victims could own 20% of PG&E, but not for long
- PG&E shares photo of damage that started Camp Fire as judge demands more from company
- State regulators detail PG&E ‘failures’ leading to deadly Camp Fire
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