Pacific Gas & Electric has agreed to plead guilty to 84 counts of involuntary manslaughter and one count of unlawfully causing a fire after it was blamed for the 2018 Camp Fire in Northern California, the deadliest wildfire in state history. The utility reached the agreement with the Butte County District Attorney’s office on March 17. The deal with made public March 23 in a regulatory filing with the U.S. Securities and Exchange Commission.
The Camp Fire in the foothills of the Sierra Nevada mountains in total left 85 people dead; a grand jury found one victim died by suicide. The fire burned through the towns of Paradise, which had about 26,000 residents, and Concow. About 18,000 buildings were destroyed. The California Department of Forestry and Fire Protection said the fire was sparked by PG&E equipment, and the state agency identified ignition points in Butte County, which is north of Sacramento and west of Reno, Nevada.
The agreement still needs approval by the Butte County Superior Court, along with the federal court overseeing PG&E’s bankruptcy case. PG&E filed for Chapter 11 protection in January 2019, in part to set up a “Fire Victim Trust” to compensate victims of a series of wildfires in recent years that were linked to the company’s equipment.
Monday’s announcement came three days after the utility, in an agreement with California Gov. Gavin Newsom, accepted tighter oversight and pledged billions of dollars to improve the safety of its equipment and operations, and help wildfire victims. In that agreement, PG&E agreed to pay no shareholder dividends for three years, which would save the company about $4 billion, and said it would pursue a “rate-neutral” $7.5 billion financing package that would benefit ratepayers.
The utility also agreed to be sold—there have been groups wanting to buy the company, including the city of San Francisco—if it cannot emerge from Chapter 11 by a state-imposed June 30 deadline. PG&E in October 2019 rejected a $2.5 billion bid from San Francisco to buy’s the utility’s power lines, saying the offer underestimated the value of the assets.
Resolve All State Charges
The utility said the plea deal will resolve all state charges related to the Camp Fire. PG&E also agreed to pay the maximum of about $4 million in fines, including expenses related to the district attorney’s investigation. The utility also has agreed to fund efforts to restore access to water for the next five years for residents impacted by the loss of the Miocene Canal, which was destroyed by the fire.
Bill Johnson, PG&E Corp. president and CEO, issued a statement Monday about the agreement: “On Nov. 8, 2018, the Camp Fire destroyed the towns of Paradise and Concow, impacted Magalia and other parts of Butte County and took the lives of more than 80 people. Thousands lost their homes and businesses. Many others were forced to evacuate and leave their lives behind. Our equipment started the fire. Those are the facts, and with this plea agreement we accept responsibility for our role in the fire.”
Johnson continued: “We cannot change the devastation or ever forget the loss of life that occurred. All of us at PG&E deeply regret this tragedy and the company’s part in it. Since the fire, we have worked side-by-side with Butte County residents and public officials to help the Paradise region recover and rebuild. That work continues today, and we are doing everything we can to make things right. We cannot replace all that the fire destroyed, but our hope is that this plea agreement, along with our rebuilding efforts, will help the community move forward from this tragic incident.”
PG&E previously reached settlements that totaled about $25.5 billion with all groups of victims from the wildfires in 2015, 2017 and 2018. Those costs contributed to the company’s bankruptcy filing; PG&E is the nation’s largest publicly held utility to file for Chapter 11 protection. Officials with both the utility and the state of California have been working on a reorganization plan that they hope will allow PG&E to emerge from bankruptcy this year.
“The action we took today is an important step in taking responsibility for the past and working to create a better future for all concerned,” Johnson said in his statement. “We want wildfire victims, our customers, our regulators and leaders to know that the lessons we learned from the Camp Fire remain a driving force for us to transform this company. We have changed and enhanced our inspection and operational protocols to help make sure this doesn’t happen again. Every single day, we have thousands of dedicated employees who are working diligently to harden the system, reduce the risk of wildfire and help deliver safe, reliable energy to our customers. We will emerge from Chapter 11 as a different company prepared to serve California for the long term.”
For more on the PG&E bankruptcy case, read some of POWER’s previous coverage.
–Darrell Proctor is associate editor for POWER (@DarrellProctor1, @POWERmagazine).