Shares of California utility PG&E tumbled Monday, because investors are worried it may go bankrupt.
PG&E (PCG) could be on the hook for tens of billions of dollars for its potential role in California’s devastating Camp Fire last year — the deadliest and most destructive wildfire in the state’s history. The company has indicated it does not have the cash or assets to pay anything close to that amount.
The utility, which provides electricity to about 16 million Californians, is contemplating filing for bankruptcy protection, Reuters reports. The stock fell 21% by midday Monday.
“The bankruptcy preparations could be designed to put pressure on the government to find a solution; however, we view the possibility of any legislation becoming law as uncertain,” said Christopher Muir, analyst at CFRA.
The cause of the Camp Fire is still under investigation, according to state fire officials. But PG&E has suggested it may be responsible. In a PG&E report last month, the company outlinedhow employees discovered damaged power towers minutes before the Camp Fire broke out.
Tne employee called 911 the day the wildfire started after spotting flames close to a high-voltage tower in Butte County — 15 minutes after a transmission line went out near that location.