SAN FRANCISCO (AP) — PG&E’s stock lost more than 20 percent of its value Wednesday after the utility said it does not have nearly enough insurance coverage if it is found liable for a Northern California wildfire that has left at least 56 people dead and destroyed nearly 9,000 homes.
San Francisco based Pacific Gas & Electric Corp. told Wall Street regulators that if its equipment were found to have caused the fire that has ravaged the town of Paradise, California, it “could be subject to significant liability in excess of insurance coverage.”READ MORE: San Francisco Police Locate Yorkshire Terrier Stolen During Brazen Vehicle Break-In
That would deal a major blow to the utilities’ finances and operations, it said. It noted that investigators have not yet determined the cause of the blaze.
PG&E’s stock fell $7.13 to close Wednesday at $25.69, a level it hasn’t seen since 2003. It has lost 47 percent of its value since the fire broke out last week.
The company said it has wildfire liability insurance coverage of about $1.4 billion for the year that ends July 31, 2019. An analyst with Citi Investment Research estimates damages from the fire could exceed $15 billion but noted that the state of California “will likely step in to protect the utility and its customers.”
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In a lawsuit filed this week, Californians who have lost homes in the state’s deadliest and most destructive wildfire said a high voltage transmission line failed, sparking the fire. They accuse PG&E of failing to maintain infrastructure and properly inspecting and maintaining its power transmission lines.READ MORE: COVID Reopening: Excitement Builds As Hours Count Down To State's Reopening
PG&E told state regulators last week that it experienced a problem on a transmission line just before the blaze erupted in the vicinity. In a filing Thursday with the state Public Utilities Commission, it said it had detected an outage on an electrical transmission line. It said a subsequent aerial inspection detected damage to a transmission tower on the line.
PG&E President Geisha Williams told the Chico Enterprise-Record on Tuesday that it was too soon to determine if sparks from a transmission line ignited the fire.
She said the sparks are one of several “options” investigators are reviewing.
PG&E did not immediately respond to a request for comment.
California Department of Forestry and Fire Protection spokesman Scott McLean said Wednesday the blaze has charred 210 square miles (544 square kilometers) and that it is one-third contained.MORE NEWS: UPDATE: Temperatures Will Soar Into Triple Digits By Mid-Week
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