California’s biggest utility is in deep trouble

CALIFORNIA’S largest utility is accustomed to disaster. In 2001 PG&E declared bankruptcy after the state mismanaged deregulation of the electricity market. In 2010 one of PG&E’S gas pipelines exploded. Its travails are even the stuff of Hollywood. “Erin Brockovich”, starring Julia Roberts, told the story of how the company let toxic wastewater run into groundwater supplies and had to settle a class-action lawsuit in 1996 for hundreds of millions of dollars. Nevertheless, PG&E’S current turmoil marks the start of something new.

On January 7th the firm’s share price plunged by more than 20% on reports that it might declare bankruptcy. PG&E faces billions of dollars of liabilities over its possible role in starting the wildfires that have ravaged California. Damages, legal fees and other costs from fires over the past two years may reach $29bn, estimates...

via Business Feeds

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