Utility regulator approve PG&E’s reorganization plan

The California Utilities Commission on Thursday unanimously approved Pacific Gas & Electric Co.'s reorganization plan.

The $58 billion reorganization would provide $25.5 billion to victims of wildfires in 2017 and 2018 and the rest -- $22 billion -- would go to pre-bankruptcy debts and payments for other costs.

The commission's approval was crucial for the utility to participate in a $21.5 billion state fund that will offset liabilities from future wildfires. But the regulator laid down conditions for its approval aiming to bolster PG&E's governance process, operational structure and safety performance.

PG&E must change its leadership structure including its board of directors. PG&E also must move its operating regions closer to customers. And rules must be put in place to correct system failures. Failure to do so could result in PG&E losing its license to provide utility services, the commission said.

The utility must come up with a plan to settle liabilities for pre-2019 wildfires that doesn't include ratepayer hikes, the regulator said.

Thursday's development "doesn't end our work ensuring PG&E makes significant improvements on how it prioritizes its customers and their safety," said commission President Marybel Batjer. "This is a company that has consistently failed to recognize privilege and responsibility that comes with being a unique provider of utility service, and has yet to demonstrate that it will focus on customers."

Bill Johnson, PG&E's chief executive officer and president, said in a statement the company's goal was to compensate wildfire victims quickly and fairly and the commission's action kept those priorities on track.

"PG&E's most important responsibility remains the safety of our customers and the communities we serve, and we are committed to doing it right by the communities impacted by wildfires," said Johnson, who leaves his post June 30. "We have heard feedback in today's decision and know we must do better as a company."