Pacific Gas & Electric, California’s largest utility, said Monday that it had agreed to plead guilty to involuntary manslaughter in connection with the Camp Fire, the state’s deadliest wildfire.
Facing tens of billions of dollars in wildfire claims, PG&E has been in bankruptcy reorganization since early last year. The company is racing to emerge from bankruptcy by June so that it can qualify for inclusion in a new state wildfire fund that could cover the costs of future fires.
The plea agreement, struck with the district attorney in the county where the Camp Fire occurred, followed the announcement on Friday that Gov. Gavin Newsom was willing to approve PG&E’s plan to emerge from bankruptcy. Under the plan, victims of the wildfires have agreed to a payment of $13.5 billion.
The plea agreement, announced in a securities filing, said PG&E had accepted a maximum penalty of $3.5 million and “no other or additional sentence will be imposed on the utility in the criminal action in connection with the 2018 Camp Fire.”
PG&E sought bankruptcy protection early last year — its second Chapter 11 filing in two decades — with $30 billion in liabilities related to wildfires ignited by the utility’s poorly maintained electrical system.
Under the agreement with Mr. Newsom announced on Friday, the utility pledged billions of dollars to help wildfire victims, improve safety and make other changes.
As part of the deal, PG&E will not pay dividends to shareholders for three years. The agreement should allow the utility to exit bankruptcy by June 30, a state-mandated deadline for it to take part in a fund that will help utilities pay claims from future wildfires.
A federal judge’s approval is still needed for the company’s bankruptcy plan.
This is a developing story. Check back for updates.