California wine country fire began near damaged PG&E tower, 2,000 flee

California wine country fire began near damaged PG&E tower, 2,000 flee
By Stephen Lam

GEYSERVILLE, Calif. (Reuters) – A wind-driven wildfire that forced some 2,000 people to flee homes in Northern California’s wine country on Thursday erupted near the base of a damaged high-voltage transmission tower owned by Pacific Gas and Electric Co, utility and fire officials said.

The company, a unit of bankrupt holding company PG&E Corp <PCG.N>, acknowledged in an “electric safety incident” report to the California Public Utilities Commission that one of its power lines malfunctioned at about the time and location of the fire’s origin on Wednesday night.

It said a PG&E technician inspecting the site on Thursday found the area taped off by state fire department personnel who brought to his attention “what appeared to be a broken jumper on the same tower”.

PG&E had shut down some electric distribution wires in the area as a precaution against dangerously high winds at the time, but high-voltage transmission lines such as that in question were left on as they were deemed durable enough for the forecast conditions, the utility said in a public statement.

The transmission tower involved had been examined this year in PG&E’s wildfire safety inspection program, it added.

Neither PG&E nor the commission said whether the damaged tower or the malfunctioning transmission line attached to it were suspected of igniting the blaze, dubbed the Kincade fire, which has destroyed about a dozen homes and other structures.

The cause is being investigated, said the California Department of Forestry and Fire Protection, or Cal Fire, which listed the same place and time of origin for the fire as the tower incident reported by PG&E.

PG&E filed for bankruptcy protection last January, citing more than $30 billion in liability stemming from devastating wildfires in 2017 and 2018 found to have been sparked by its equipment.

The Kincade fire in Sonoma County was the worst of several blazes raging throughout California as PG&E and other utilities cut off electricity to nearly 200,000 homes and businesses in preventive blackouts to reduce wildfire risks from high winds.

Hundreds of miles to the south in the Canyon County community of Los Angeles County, a blaze called the Tick fire prompted evacuation of an estimated 40,000 residents. Flames consumed about 5,000 acres (2,000 hectares) and destroyed an unknown number of structures, according to the Los Angeles City News Service.

HISTORIC TOWN EVACUATED

By Thursday, the Sonoma County blaze had scorched about 10,000 acres (4,000 hectares), Cal Fire said. No injuries have been reported.

Ground crews fought the blaze at close range with hand tools and bulldozers, assisted by water-dropping helicopters and airplane tankers carrying payloads of fire-retardant slurry.

The Sonoma County sheriff’s office ordered the evacuation of Geyserville, a town of nearly 900 people, founded in the mid-19th century and named for nearby hot springs and geothermal attractions.

A Reuters photographer saw about a dozen homes in flames in the town on Thursday.

By midday, mandatory evacuation notices covered a total of roughly 2,000 people, the sheriff’s office said. An evacuation warning in the northern end of the nearby larger town of Healdsburg, urged residents to be ready to flee at a moment’s notice.

Both towns, about 75 miles (120 km) north of San Francisco, are hubs of upscale restaurants, wine-tasting rooms, inns, and shops surrounded by rolling hills dotted by vineyards.

Large parts of California were under red-flag alerts this week following forecasts of hot, dry winds blowing into populated areas from deserts to the east.

The number of homes and workplaces without power could climb to more than 500,000 under worst-case scenarios for precautionary outages this week, according to PG&E, Southern California Edison <EIX.N> and other electricity providers.

PG&E said in a statement on Thursday it had shut off power for about 178,000 houses and businesses in northern California during an Oct. 23 public safety power shutoff (PSPS) event.

The company has restored power to 93% of those customers following announcements that the weather was “all-clear,” the statement said.

“Safety patrols, inspections and power restoration took place throughout the day and continues through the night,” PG&E said, adding that it expects power to be restored to all customers on Friday, unless any equipment is damaged and needs repair.

Marc Chenard, a forecaster with the National Weather Service’s Weather Prediction Center, said that while the winds have abated for Friday in northern California, the area is in for more high winds this weekend.

“Yes, it’s improving, most of the warnings there have been lifted for now,” Chenard said. “But we have another (wind) event coming in for Saturday and at least through Sunday. This isn’t over.”

Earlier on Thursday, California Governor Gavin Newsom, who called PG&E’s handling of that incident “unacceptable,” said the company appeared to have “significantly” improved its readiness for this week’s wildfire threat.

Chenard said that hot dry winds, called the Santa Ana winds in Southern California east of San Bernardino and down to San Diego are expected to continue through the weekend.

(Reporting by Stephen Lam in Geyserville; Additional reporting by Maria Caspani in New York, Subrat Patnaik in Bengaluru and Rich McKay in Atlanta; Writing and additional reporting by Steve Gorman and Dan Whitcomb in Culver City, Calif.; Editing by Bill Tarrant, Leslie Adler and Lincoln Feast)

California power cutoff begin as wildfire risks rise

California power cutoff begin as wildfire risks rise
By Steve Gorman

(Reuters) – Hundreds of thousands of California homes and businesses started to lose electric power early Wednesday as part of an unprecedented effort by Pacific Gas and Electric Co. to prevent wildfires, the utility said.

Nearly 800,000 northern and central California homes and businesses can expect to lose electricity for up to several days, starting on Wednesday, PG&E said.

State investigators determined in May that PG&E transmission lines had caused last year’s Camp Fire. That fire killed 85 people, making it the deadliest in California’s history.

The company had already filed for bankruptcy protection by then, citing potential liabilities of more than $30 billion from the Camp Fire and the 2017 North Bay Fires.

Conditions before the fires were about the same then as they are now in the region. Gale-force winds are expected to last through midday Thursday, with gusts up to 70 miles per hour, PG&E said. Humidity is low, leaving the air extremely dry.

The California Department of Forestry and Fire Protection (Cal Fire) said “red-flag” warnings were posted across the entire state for what was shaping up to be the strongest wind so far this season.

Consequently, PG&E said on Tuesday it was extending a previously announced “public safety power shutoff” to 34 counties, more than half of all the counties in California. It’s the largest such precautionary outage the utility has undertaken to date.

Once power is turned off, it cannot be restored until the winds subside, allowing the utility to inspect equipment for damage and make any repairs, PG&E said.

The first phase of the outages, affecting about 513,000 customers in northern California, began after midnight, PG&E said in an early morning release. Depending on the weather, additional outages will continue at noon, the company said.

“We’re telling customers to be prepared for an outage that could last several days,” PG&E spokeswoman Tamar Sarkissian told Reuters.

SOME OBJECT

Some consumer advocates have objected to the precautionary disruptions, saying they can harm people who need electricity for medical equipment.

But PG&E promised to open community centers in 30 locations across the planned outage zone to furnish restrooms, bottled water, battery charging and air-conditioned seating during daytime hours.

Sarkissian said PG&E had placed 45 helicopter crews and 700 extra ground personnel on standby for inspections and repairs once the wind dies down. Some equipment locations will require workers to hike into remote or mountainous areas, she said.

(Reporting by Steve Gorman in Los Angeles; additional reporting Jim Christie in San Francisco and Rich McKay in Atlanta; editing by Larry King)

PG&E settles wildfire claims with insurers for $11 billion

(Reuters) – PG&E Corp said on Friday it has reached an $11 billion settlement to resolve most claims by insurance carriers related to 2017 and 2018 wildfires in California.

It is the second major settlement of wildfire claims by PG&E, and requires approval by the federal bankruptcy judge overseeing the utility’s Chapter 11 case.

PG&E said proceedings on the third and final major group of wildfire claims remain pending in federal and state courts.

It said the latest settlement is related to payments made by insurers to individuals and businesses with coverage for wildfire damage.

Representatives of holders of 85% of so-called subrogation claims said the latest accord does not fully satisfy its $20 billion in claims, but would “pave the way for a plan of reorganization that allows PG&E to fairly compensate all victims and emerge from Chapter 11 by the June 2020 legislative deadline.”

Subrogation allows insurers that pay policyholders for insured losses to recoup sums from third parties they deem responsible for them.

The company also amended its equity financing commitment agreements to accommodate the claims, and reaffirmed its $14 billion equity financing commitment target for its reorganization plan.

In June, PG&E agreed to pay $1 billion to resolve claims by 18 local public entities related to wildfires in 2015, 2017, and 2018.

On Monday, the company unveiled the outlines of a reorganization plan that would pay $17.9 billion for claims stemming from the wildfires that led to its bankruptcy in January.

At the time of its Chapter 11 filing, PG&E projected more than $30 billion in liabilities from wildfires, including last year’s Camp Fire, the deadliest and most destructive wildfire of California’s modern history.

The plan filed in the U.S. Bankruptcy Court in San Francisco includes up to $8.4 billion for wildfire victims, payments capped at $8.5 billion for reimbursing insurers, and the $1 billion settlement with local governments.

On Tuesday, a lawyer representing wildfire victims called the $8.4 billion cap “totally unacceptable” because government agencies could have billions of dollars in claims, leaving far less than $8.4 billion for victims.

PG&E shares were up 7.8% in early afternoon trading, after earlier rising as much as 9.8%.

(Reporting by Arundhati Sarkar in Bengaluru; Editing by Arun Koyyur and Shinjini Ganguli)

California wildfire victims lawyer calls PG&E plan ‘totally unacceptable’

By Tom Hals

(Reuters) – PG&E Corp’s plan to cap payments to victims of California wildfires blamed on the power producer is “totally unacceptable,” a lawyer representing victims in the utility’s bankruptcy case said on Tuesday.

San Francisco-based PG&E unveiled on Monday a proposed plan to exit bankruptcy that included payments capped at $8.4 billion for wildfire claims.

The plan forces fire victims and government entities to seek compensation from the same fund, which will dilute payouts for everyone, said Cecily Dumas, a BakerHostetler lawyer who represents the official committee of tort claimants in PG&E’s bankruptcy.

State investigators have blamed PG&E transmission lines with causing wildfires in 2017 and 2018 including the Camp Fire that killed 85 people.

Dumas said that government agencies such as the Department of the Interior and the Federal Emergency Management Agency, or FEMA, could have billions of dollars in claims, leaving far less for victims than $8.4 billion.

At the same time, PG&E said it intends to pay other unsecured creditors such as noteholders in full in cash when its plan goes into effect next year. “That’s unfair,” said Dumas.

A spokesman for PG&E did not immediately respond to a request for comment.

The company also said it planned to cap payments at $8.5 billion for reimbursing insurers that had paid victims and at $1 billion for local governments.

PG&E said it would finance the plan through the sale of $14 billion of stock, and PG&E said large banks expressed confidence that $30 billion could be raised in both debt and equity.

Shares of PG&E Corp fell 3% on Tuesday to $10.86 each.

Court documents showed that Knighthead Capital Management, one of PG&E’s largest shareholders, was prepared to buy up to $1 billion of the company’s stock on behalf of funds it manages. Funds associated with Abrams Capital Partners, Riva Capital Partners and Whitecrest Partners were prepared to invest $500 million combined in PG&E stock, according to court documents.

The plan must be approved by U.S. Bankruptcy Judge Dennis Montali in San Francisco. Companies in Chapter 11 generally seek broad support from creditors.

Dumas said the plan also violates the so-called absolute priority rule, a bedrock principle of bankruptcy that requires that creditors get paid in full before shareholders receive anything.

She said the court should allow wildfire victims to choose between the PG&E plan and an alternative bondholder proposal.

Bondholders led by Elliott Management and Pacific Investment Management Co have proposed a $30 billion plan that included $16 billion in compensation for all PG&E’s pre-bankruptcy wildfire claims.

(Reporting by Tom Hals in Wilmington, Delaware; additional reporting by Jim Christie in San Francisco; Editing by Marguerita Choy and Cynthia Osterman)

California utility to cut power to 27,000 customers to reduce wildfire risk

FILE PHOTO: A lineman from Pacific Gas & Electric (PG&E) works on a power line near a neighborhood destroyed by wildfire in Santa Rosa, California, U.S., October 12, 2017. REUTERS/Jim Urquhart

By Alex Dobuzinskis

LOS ANGELES (Reuters) – Utility PG&E Corp planned to proactively shut off power on Saturday to 27,000 customers in Northern California due to an increased risk of wildfires, officials said.

The shut down would begin at 9 p.m. local time in and around the Sierra Foothills, an area spanning parts of Butte, Yuba, Nevada, El Dorado and Placer counties northeast of San Francisco and near the border with Nevada, the utility said on Twitter.

The area includes portions of Paradise, the town that was destroyed by November’s deadly wildfire known as the Camp Fire, which killed more than 80 people.

PG&E said this year it would significantly expand the practice of shutting off power to communities at risk of wildfire when conditions demand it, despite objections from some consumer advocates who said such disruptions can harm vulnerable people such as those who need electricity for medical equipment.

PG&E has been in touch with people in the affected areas who rely on power for their medical equipment, Adam Pasion, a spokesman for the utility, said in a phone interview.

“We certainly recognize the risk and are only doing this in the most extreme circumstances we feel that we need to,” Pasion said.

Earlier on Saturday, the utility shut down power to around 1,600 customers just north of San Francisco, in Napa, Solano and Yolo counties, also due to the risk of wildfires after forecasters said a combination of strong winds, dry conditions and warm temperatures raised the fire danger.

But conditions improved, allowing the utility to begin restoring power to those customers, Pasion said.

The utility sought bankruptcy protection in January after facing billions of dollars in liabilities stemming from the Camp Fire, California’s deadliest and most destructive wildfire in modern times.

State investigators concluded that PG&E’s power lines caused the fire, which leveled nearly 19,000 homes and other structures and caused some $16.5 billion in losses.

(Reporting by Alex Dobuzinskis; Additional reporting by Joseph Ax; Editing by David Gregorio and Christopher Cushing)

PG&E proposes court order for CEO, board to tour town destroyed by wildfire

FILE PHOTO: A statue stands in front of a home destroyed by the Camp Fire in Paradise, California, U.S., November 17, 2018. REUTERS/Terray Sylvester/File Photo

(Reuters) – PG&E Corp on Monday submitted a proposed order to a U.S. District Court judge that would require the power provider’s chief executive and board to visit the California town of Paradise by July 15, to see the destruction caused by a wildfire in November that may be linked to the company’s equipment.

The order, agreed to by the U.S. Justice Department and U.S. Probation Officer, awaits U.S. District Court Judge William Alsup’s signature.

He is also overseeing PG&E’s probation stemming from a felony conviction over a deadly 2010 natural gas pipeline in San Bruno, California, that destroyed a neighborhood and killed eight people.

The judge last week called for PG&E officials to tour Paradise town. November’s Camp Fire leveled the town and killed more than 80 people, marking the most destructive and deadliest wildfire in California’s modern history.

The Camp Fire also pushed San Francisco-based PG&E to seek Chapter 11 bankruptcy protection in January in the expectation of, potentially, billions of dollars in liabilities. PG&E has said it expects its equipment may be found to have sparked the blaze.

The proposed order also requires PG&E’s chief executive and board to visit San Bruno to meet with victims of the 2010 explosion there as well as city officials and firefighters.

(Reporting by Jim Christie in San Francisco and Rama Venkat in Bengaluru; Editing by Rashmi Aich)

California utility PG&E vows more power shutdowns to prevent wildfire

FILE PHOTO: A neighborhood destroyed by the Camp Fire is seen in Paradise, California, U.S., November 17, 2018. REUTERS/Terray Sylvester/File Photo

By Sharon Bernstein

SACRAMENTO, Calif. (Reuters) – California utility PG&E Corp plans to increase the controversial practice of shutting off the power to communities at risk of wildfire when dangerous conditions such as high winds and dry heat are present.

In a report to state regulators, PG&E said it would also remove 375,000 trees near electricity lines, trim vegetation over 2,500 square miles (6,475 square km) and conduct thousands of inspections to prevent its equipment from sparking wildfires.

FILE PHOTO: PG&E works on power lines to repair damage caused by the Camp Fire in Paradise, California, U.S. November 21, 2018. REUTERS/Elijah Nouvelage/File Photo

FILE PHOTO: PG&E works on power lines to repair damage caused by the Camp Fire in Paradise, California, U.S. November 21, 2018. REUTERS/Elijah Nouvelage/File Photo

PG&E is under intense scrutiny for its role in sparking more than a dozen wildfires over the past two years. It filed bankruptcy last month, citing anticipated liabilities, including the possibility its equipment set off November’s deadly Camp Fire, which destroyed the Northern California town of Paradise and killed 86 people.

The San Francisco-based utility, which serves 16 million customers, said it would increase nearly tenfold its efforts to turn off the power to communities threatened by wildfire, increasing the number of households and businesses potentially affected by fire-prevention blackouts in 2019 to 5.4 million.

Such shutoffs were also used last year to keep live electricity in the lines from setting off a fire when high winds and heat hit extreme levels and nearby brush or trees could be ignited.

Mark Toney, who directs the utility consumer advocacy group the Utility Reform Network (TURN), said shutting off power would harm vulnerable people, including those who rely on electricity to power life-saving medical equipment.

“The fact that there is such a dramatic expansion of power shutoffs as a strategy to stop wildfires is a sign of PG&E’s failure and mismanagement when it comes to trimming the trees and taking care of the grid,” he said.

PG&E spokeswoman Kristi Jourdan said the company would only turn off the power to a community as a last resort to keep people safe.

“We understand and appreciate that turning off the power affects the operation of critical facilities, communications systems and much more,” she said.

The company is also on probation in relation to a criminal conviction in the deadly 2010 explosion of one of its natural gas lines in the city of San Bruno near San Francisco.

The judge, in that case, said he would consider the company’s wildfire plan in deciding whether PG&E should do more to prevent wildfire.

California law requires all investor-owned utilities to file wildfire mitigation plans annually.

(Reporting by Sharon Bernstein; editing by Bill Tarrant and Lisa Shumaker)

No clear path for California as massive PG&E utility nears bankruptcy

FILE PHOTO: PG&E works on power lines to repair damage caused by the Camp Fire in Paradise, California, U.S. November 21, 2018. REUTERS/Elijah Nouvelage/File Photo

By Sharon Bernstein

SACRAMENTO, Calif. (Reuters) – PG&E Corp’s announcement that it will file for bankruptcy, citing massive potential liability from deadly wildfires, puts California politicians in quandary, whether to offer a bailout or risk allowing the state’s largest private utility to fail.

Governor Gavin Newsom, a Democrat, told reporters late on Monday his team was discussing the possibility of helping PG&E stay solvent, but no decisions had been made.

And lawmakers in the state legislature, who last year approved a bill making it easier for PG&E to bill ratepayers for the costs of wildfires sparked by its equipment in 2017, said that there was less support this year for extending additional financial assistance to the company.

“We would like to see it (bankruptcy) avoided, but we are not naive,” Newsom said. “I’m cognizant of the taxpayers, and I’m cognizant of the ratepayers, and I’m absolutely cognizant of those who lost everything.”

FILE PHOTO: Forensic anthropologists recover remains from a trailer home destroyed by the Camp Fire in Paradise, California, U.S., November 17, 2018. REUTERS/Terray Sylvester/File Photo

FILE PHOTO: Forensic anthropologists recover remains from a trailer home destroyed by the Camp Fire in Paradise, California, U.S., November 17, 2018. REUTERS/Terray Sylvester/File Photo

PG&E’s announcement on Monday that it intends to file for Chapter 11 bankruptcy protection as early as this month, citing potential liability exceeding $30 billion due to wildfires, came a day after its chief executive officer, Geisha Williams, was ousted from her post.

PG&E, which ranks as the largest U.S. power utility by the number of customers, supplies electricity to 40 percent of Californians. The state, Newsom said, is determined to keep service running to those customers.

But the utility’s power equipment has been linked to the ignition of more than a dozen wildfires in the past two years and is a suspected cause of the deadliest fire in state history, which swept through the town of Paradise in November, killing 86 people and destroying 90 percent of homes and businesses there.

Mark Toney, executive director of consumer advocate group the Utility Reform Network, said the atmosphere had cooled considerably toward PG&E in recent months, making a bailout politically more difficult for lawmakers.

“PG&E is going to have a much harder time because it doesn’t appear that they’ve learned any lessons,” Toney said.

FILE PHOTO: Statues are seen on a property damaged by the Camp Fire in Paradise, California, U.S. November 21, 2018. REUTERS/Elijah Nouvelage/File Photo

FILE PHOTO: Statues are seen on a property damaged by the Camp Fire in Paradise, California, U.S. November 21, 2018. REUTERS/Elijah Nouvelage/File Photo

MIXED SIGNALS

The legislature and the governor could decide to allow PG&E to pass along the costs associated with victim lawsuits and other fire losses to ratepayers, as they did last year for a series of deadly northern California blazes in 2017.

Such legislation would also let utilities shift some future fire-related costs to consumers so long as regulators find no negligence on the companies’ part.

But state lawmakers have given mixed signals about what they might do about liability stemming from the deadly Camp Fire of November 2018 that incinerated most of Paradise.

Legislators representing areas devastated by wildfires have opposed any bailout for PG&amp;E, saying its investors should absorb the costs – even if that means the company is bankrupted.

PG&E’s safety record has come under sharp scrutiny before.

State Senator Jerry Hill, whose district includes the site of the deadly 2010 San Bruno gas pipeline explosion determined to have been caused by PG&E’s criminal negligence said support for the utility was softer this year.

“I think there’s less chance, less thought of a bailout this year than we saw last year, certainly,” said Hill, who has the names of the nine people killed in the San Bruno blast framed in his office.

(Reporting by Sharon Bernstein in Sacramento, Calif.; Editing by Steve Gorman and Clarence Fernandez)