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After 115 years of having its headquarters in San Francisco, PG&E announced it will move to Oakland beginning in 2022. The move to the new base at 300 Lakeside Drive will be completed in 2023, the utility said.
PG&E, now in the final phase of Chapter 11 bankruptcy proceedings, said it expects the move to reduce its costs.
The new headquarters “is a critical part of fulfilling our commitment to operate in a fiscally responsible way that will enable us to achieve our operational and safety goals,” Interim Chief Executive Officer Bill Smith said in a statement.
The announcement Monday came on the same day that U.S. District Judge Dennis Montali took PG&E’s $58 billion bankruptcy exit plan under advisement after completing an eight-day confirmation hearing.
PG&E is seeking Montali’s approval for the plan before a June 30 deadline for its participation in a wildfire insurance fund established by the state Legislature to cushion utilities’ liability in the event of future catastrophic wildfires.
Montali did not say when he will rule but said during the video hearing, “I’m not planning to wait until June 30 to issue a decision.”
PG&E filed for Chapter 11 bankruptcy protection, which enabled it to freeze its debts temporarily, in January 2019 in the face of billions of dollars of claims for wildfires in the North Bay in 2017 and Butte County in 2018.
The plan includes a $13.5 billion trust, half of which would be in PG&E stock, for people who lost family members, homes and businesses in the fires and have not been compensated by insurance. It would also provide $11 billion to insurance companies that have paid claims, and $1 billion to state and local governments.
A key unresolved issue is whether the fire victims’ trust will have the same rights to sell stock as investors who are expected to buy $9 billion in shares as part of PG&E’s refinancing plan.
PG&E attorney Stephen Karotkin told Montali Monday that the dispute is still in mediation before a retired bankruptcy judge.
On Friday, Robert Julian, a lawyer for an official committee representing wildfire victims, told Montali that proposed restrictions on the victims’ stock sales could mean that it would take five or six years for the trust to complete selling those shares, while no similar restrictions are imposed on investors.
“The victims’ stock must be treated equally” with that of investors, Julian argued.
The committee, known as the Official Committee of Tort Claimants and appointed by a federal trustee, represents about 70 percent of the more than 80,000 people with wildfire claims.
Julian said Friday that the committee would support PG&E’s plan if the dispute about the stock sale rights is resolved.
Some victims not satisfied
Some fire victims continue to oppose the plan, however.
Fire survivor Will Abrams of Santa Rosa, who argued before Montali last Thursday that the plan was aimed at benefiting hedge funds and large investors, filed a renewed objection in Montali’s court Monday morning, contending the plan is “unconfirmable and manifestly unjust” to victims.
Karotkin in his final arguments on Monday afternoon told Montali, “Confirmation is the only path here.
“Any other path … would delay distributions to fire claimants for months, if not years,” Karotkin contended.
The wildfire insurance fund established by the state Legislature in AB 1054 last year would provide up to $21 billion to pay for future wildfire liability for the state’s three largest investor-owned utilities: PG&E, Southern California Edison and San Diego Gas & Electric Co.
Half of the fund would be paid by the utilities’ shareholders and half would be paid by their customers. A utility would have to show that it took “reasonable” wildfire safety measures to have access to the fund. The law requires PG&E to exit bankruptcy by June 30 to be eligible for participation.