A Pacific Gas and Electric Co. spokesman said the Chapter 11 bankruptcy the company plans to file around the end of the month will have no impact on the company’s jobs and customer service on the Central Coast or on the timeline for closing Diablo Canyon Power Plant.

“It will be business as usual,” Blair Jones, senior manager of external communications for PG&E, said Monday afternoon. “We do not expect any impacts (on the Central Coast) during this process.”

PG&E announced Monday morning that it planned to file for Chapter 11 bankruptcy, allowing the utility to reorganize and control the financial liability it is facing from billions of dollars in claims and lawsuits filed over wildfires allegedly caused by the company’s power transmission lines.

In documents filed Monday with the Security and Exchange Commission, company officials said PG&E could face liabilities in excess of $30 billion — which doesn’t include punitive damages, fines and penalties — from wildfires the company allegedly caused in 2017 and 2018.

Those include last year’s devastating Camp fire in Northern California that killed 86 people and destroyed 14,000 homes, 500 businesses and 4,300 other structures.

Claims from the Camp fire, which investigators believe was sparked by PG&E electric transmission lines touching tree limbs, already total $7 billion, PG&E officials said.

Bankruptcy experts said filing for Chapter 11 will allow PG&E to negotiate a reorganization plan with plaintiffs and creditors that’s based on how much the utility is able to pay.

“We believe a court-supervised process under Chapter 11 will best enable PG&E to resolve its potential liabilities in an orderly, fair and expeditious fashion,” said John R. Simon, interim chief executive officer for PG&E Corp.

“We expect this process also will enable PG&E to access the capital and resources we need to continue providing our customers with safe service and investing in our systems and infrastructure.”

Experts said they expect the company’s shareholders to bear the brunt of the financial impacts from the wildfire lawsuits and bankruptcy.

The Thomas fire, which burned 281,893 acres in Santa Barbara and Ventura counties in 2017 and 2018, destroyed 1,063 structures, resulted in two deaths and set the stage for the 1/9 Debris Flow, also is believed to have been caused by power lines — but those of Southern California Edison Co., not PG&E.

Jones said reorganization won’t affect the company’s ability to provide electric service to customers or the jobs of company employees on the Central Coast.

“We will continue delivering reliable electrical service to our customers,” Jones said.

He added the bankruptcy also will not result in any of the company’s employees being laid off, including nearly 2,000 in Santa Barbara and San Luis Obispo counties.

Sign up to receive headlines in your inbox!

Breaking News | Local Sports | Daily Headlines | Local Obituaries | Weather | Local Offers

“We did not announce any job layoffs in our announcement (about the plan to file bankruptcy) today,” he said.

“Same thing for Diablo Canyon,” Jones said about PG&E’s plans to decommission the nuclear power plant on the Pecho Coast north of Avila Beach when the operating licenses granted by the Nuclear Regulatory Commission for the twin reactors expire in 2024 and 2025.

“We have no specific plans to sell or change the schedule for Diablo Canyon,” he said.

The approximately 1,500 company employees who work at Diablo Canyon or in jobs associated with the plant likely would be protected from layoffs anyway as a result of legislation sponsored by state Sen. Bill Monning and Assemblyman Jordan Cunningham that was passed by both houses and signed into law by former Gov. Jerry Brown.

One of Senate Bill 1090’s provisions directs the California Public Utilities Commission to approve PG&E's full $350 million program to retain and retrain Diablo Canyon employees.

Jones said filing for bankruptcy will likewise not affect PG&E’s application to increase electric rates to help cover the $4.8 billion the utility now estimates it will cost to close and decontaminate Diablo Canyon.

If approved by the CPUC, the increase would raise the average Central Coast electric customer’s bill by about $2 a month.

Jones said the rate increase increment would be deposited in the trust fund authorized in 1995 to pay for decommissioning Diablo.

That fund currently stands at $3.2 billion, but the California Public Utilities Commission denied the company’s last two requests to raise rates for decommissioning.

So rates have not been collected for the trust fund for five years.

“We remain focused on continuing plans to decommission Diablo Canyon,” Jones said, which includes seeking money from ratepayers to cover the costs.

He also indicated the utility would not abandon the project before it was finished.

Unless an agreement is reached for an alternative use of the facilities, closing the plant would not only mean halting power generation but also demolishing all the structures, hauling them away, dismantling the breakwater and marina and returning the site to its natural state.


County Reporter/Associate Editor

Lee Central Coast Newspapers associate editor Mike Hodgson covers Santa Barbara County government and events and issues in Santa Ynez Valley. Follow him on Twitter @MHodgsonSYVNews.

Recommended for you