Embattled California utility PG&E announced Monday it plans to file for bankruptcy, seeking Chapter 11 protection amid billions of dollars in liability costs related to the company's role in wildfires in 2017 and 2018, including last year's deadly Camp Fire, which killed 86 people.
Word of the bankruptcy sent the San Francisco-based company's stock price tumbling 50 percent Monday morning.
Jacob Kilstein, an analyst at Argus Research, said he was stunned by Monday's announcement and had expected PG&E to push for state bailout money before playing the bankruptcy option.
"I would have thought that keeping the company in business would be in the best interests of customers and even creditors. I thought the state would step in and serve as a buffer to this," Kilstein told NBC News. "This is the biggest utility failure I’ve seen."
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PG&E Chief Executive Officer Geisha Williams resigned over the weekend and acting CEO John Simon said the company will "resolve its potential liabilities in an orderly, fair and expeditious fashion."
The lights and gas will remain on, PG&E officials said, noting that the utility "remains committed to providing safe natural gas and electric service to customers as it prepares to initiate voluntary reorganization proceedings under Chapter 11," according to a company statement.
"We're telling consumers not to panic. The lights won't go out," said Mindy Spatt, a spokeswoman for consumer advocacy group The Utility Reform Network. "Main take away is that the company expects to be found responsible for the Camp Fire."