Two PG&E settlement deals worth a combined $24.5 billion to compensate wildfire victims and insurance companies was approved by a U.S. bankruptcy judge on Tuesday.
After a long 5 hour hearing in San Francisco, Bankruptcy Judge Dennis Montali first approved a settlement deal of $13.5 billion for victims of wildfires caused by PG&E. This includes victims of the Camp Fire in 2018 that resulted in the deaths of dozens of people. Another settlement deal of $11 billion was subsequently approved for insurance companies who had to pay a record setting number of claims as a result of the amount of property destroyed in PG&E caused wildfires.
The approved settlements came less than a day after PG&E and wildfire victim representatives removed a part of the settlement provisions that required the Governor’s approval on any settlement deal. Governor Gavin Newsom had earlier rejected the same $13.5 billion deal that was approved Tuesday.
“Today marks an important milestone,” said PG&E in a statement. “The Bankruptcy Court has approved our settlement agreements resolving all major wildfire claims. This brings us one significant step closer to getting victims paid so they can rebuild their lives.”
While this is a major step for PG&E to emerge from bankruptcy by the state’s June 2020 deadline, PG&E still has a long way to go.
“You have to remember they just went around Gavin [Newsom],” noted former environmental lobbyist Margaret Horner. “He and people he appointed need to approve a lot of what PG&E has to do in the upcoming months. Gavin [Newsom] still wants PG&E house cleaning, including no more blackouts, new directors in charge of the company, and basically wants a new blueprint for the company.”
“If they don’t get his seal of approval, that means they are going to lose state help, and that means they aren’t going to get out of bankruptcy. At least not quickly enough. And that means they can be bought up. Many Californian cities have shown interest, and so has the state. As well as many other companies. Especially those out in New York.”
“Getting a settlement was huge, but now they have to play ball with them unless they want to risk losing everything.”
PG&E also has smaller settlements currently waiting approval. Victims of the 2016 Ghost Ship Warehouse fire that killed over 30 people are currently seeking a settlement from PG&E. And the California Public Utilities Commission is currently weighing a settlement worth $1.675 billion over PG&E’s role in starting several deadly wildfires in the past few years.
The court proceedings for PG&E to get out of bankruptcy are currently expected to continue well into 2020.