PG&E, the California utility giant that went bankrupt five months ago amid crippling wildfire liabilities, has reached a $1 billion settlement with local government agencies that were harmed by blazes its equipment ignited.
The deal between PG&E and 14 public entities includes a settlement for the town of Paradise, which was destroyed in November’s Camp Fire — the deadliest in California history. The agreement doesn’t affect lawsuits filed by individual homeowners and businesses against the San Francisco company, owner of California’s largest utility, and it must be approved by the judge overseeing the bankruptcy case.
Shares of the company rose as much as 5.5 percent on the news before paring most of those gains in after-markets trading late Tuesday.
The settlement is one step forward for PG&E, which is working through the largest utility bankruptcy in U.S. history. The company has been juggling the interests of wildfire victims, activist investors, and state lawmakers and regulators as it tries to come up with a restructuring plan.
“What we hope is that PG&E can come out of bankruptcy as soon as possible so these funds can be paid,” said John Fiske, an attorney with the Baron & Budd law firm representing the public agencies.