California Governor Rejects PG&E's Bankruptcy Reorganization Plan

(RTTNews) - California Governor Gavin Newsom rejected a bankruptcy reorganization plan submitted by PG&E Corp (PCG), saying that the company's proposal doesn't comply with terms of a recently passed wildfire liability law. The proposal doesn't go far enough to make the company "positioned to provide safe, reliable and affordable service."

PG&E had filed for bankruptcy protection in January as it faces up to $30 billion in fire liabilities, including last year's Camp Fire which killed at least 86 people.

Last week, PG&E reached a settlement valued at about $13.5 billion to resolve all remaining wildfire claims, including individual claims, relating to the 2015 Butte Fire, 2016 Ghost Ship Fire, 2017 Northern California Wildfires, and the 2018 Camp Fire pursuant to the terms of PG&E's Plan.

But, the company's reorganization plan does not include some requirements established in state law, including "major changes in governance" and "enforcement mechanisms," Newsom said in a letter to PG&E Chief Executive Officer Bill Johnson.

Responding to Newsom's letter, PG&E said it believes the restructuring plan meets the requirements.

Newsom noted that he aims to get the company out of bankruptcy by June 30, 2020 by working on a plan with PG&E, but said that the company could not continue without making changes to its safety culture.