California Governor Gavin Newsom wants Pacific Gas and Electric Company (PG&E) to quickly exit bankruptcy and begin transforming itself into a new entity that prioritizes public safety.
On Friday, Gov. Newsom called on the company’s executives, shareholders, creditors and wildfire victims to reach a “consensual resolution” to get the company out bankruptcy before the wildfire season next year.
“We want to broker that mediation and are calling on all the parties to come in early next week to jumpstart those negotiations,” said the Governor during a press conference in Sacramento.
Gov. Newsom emphasized that PG&E “cannot persist and continue” as it is. The company needs to completely transform its culture and operations. He added that the Public Safety Power Shutoffs (PSPS) that Californians experienced last week were unacceptable.
“We had people out in some circumstances for one full week without power. You gotta consider the life impacts of these power cutoffs,” said Gov. Newsom.
The company faced strong criticisms and regulatory scrutiny over its power shutoffs to prevent fires during extremely hot, dry and powerful wind conditions. The blackouts affected thousands of customers in multiple counties.
Gov. Newsom warns that State could step in and restructure PG&E
In a statement, Gov. Newsom wrote, “While this week showed how California is leading the world in wildfire prevention and response, PG&E presented the opposite portrait. Long and widespread blackouts highlighted their culture of ineptitude – a behemoth that was slow to act and resistant to change.”
“For decades, PG&E failed to prioritize public safety. Their lack of safety investments left PG&E – and nearly half of Californians – with an antiquated electrical system that is vulnerable to weather events and not at all prepared for the more extreme weather associated with the climate change…”
“This outdated infrastructure, lack of preparation and a failure to lead and be accountable to their customers and communities led PG&E to today’s overreliance on, and botched implementation of power shutoffs – failing customers and the state. Millions of Californians lost power for days at a time. Far too many households and businesses were without power for seven days straight.”
Furthermore, Gov. Newsom said, “This cannot – and will not – be the new normal. California demands better.” He reiterated that PG&E must quickly exit bankruptcy and transform itself into a new company that “prioritizes safety, understands the communities it serves, and is responsive to the needs of customers.”
“It is my hope that the stakeholders in PG&E will put parochial interests aside and reach a negotiated resolution so that we can create this new company and forever put the old PG&E behind us,” said the Governor.
Moreover, he warned that the State “will not hesitate to step in and restructure” PG&E if its executives, shareholders, creditors and wildfire victims fail to reach an agreement.