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PG&E filed reorganization plan, $17.9 billion for wildfire claims

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Christian Fernsby ▼ | September 10, 2019
PG&E Corporation and Pacific Gas and Electric Company filed a joint Chapter 11 Plan of Reorganization in the United States Bankruptcy Court for the Northern District of California.
Pacific Gas and Electric Company
America   Pacific Gas and Electric Company
As contemplated by the Plan, PG&E is on track to achieve confirmation of the plan in advance of the june 30, 2020, deadline set forth in assembly bill 1054 for participation in the newly-established state wildfire fund.

Topics: Pacific gas electric Chapter 11

The plan proposes a rate-neutral framework that fairly compensates wildfire victims and other stakeholders, prioritizes the interests of our customers and communities, and meets PG&E's legal obligations.

It is comprised of, among other things, the following:

Compensation of wildfire victims and certain limited public entities from a trust funded for their benefit in an amount to be determined by the Bankruptcy Court not to exceed $8.4 billion;

Compensation of insurance subrogation claimants from a trust funded for their benefit in an amount to be determined by the Bankruptcy Court not to exceed $8.5 billion;

Payment of $1 billion in full settlement of the claims of certain public entities relating to the wildfires, as previously announced;

Payment in full, with interest, of all prepetition funded debt obligations, all prepetition trade claims and employee-related claims;

Assumption of all power purchase agreements and community choice aggregation servicing agreements;

Assumption of all pension obligations, other employee obligations, and collective bargaining agreements with labor;

Future participation in the state wildfire fund established by Assembly Bill 1054; and

Satisfaction of the requirements of Assembly Bill 1054.

PG&E's Chapter 11 emergence financing is expected to include a substantial equity financing component, which could include a rights offering to existing shareholders or one or more offerings in the capital markets.

PG&E intends to work with financial institutions over the next several weeks to obtain up to $14 billion of total equity financing commitments.

All proceeds of the equity commitments will be used to pay wildfire victims and help fund PG&E's contributions to the state wildfire fund.


 

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