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Cal Fire Blames PG&E for Deadly Camp Fire Last Year

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Nov. 20 2020, Updated 3:05 p.m. ET

Stock is up 50% since filing for bankruptcy

The California Department of Forestry and Fire Protection (or Cal Fire) has blamed PG&E Corporation (PCG) for causing the most devastating wildfire in state history last year. The state agency said that transmission lines owned by San-Francisco-based PG&E ignited the fire in Butte County, which rapidly spread across the dry vegetation.

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PG&E filed for Chapter 11 bankruptcy protection on January 29. The utility faces ~$30 billion in potential liabilities associated with wildfires in 2017 and 2018. The “Camp Fire” killed 85 people and torched 18,804 structures last November.

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PG&E stock has been down more than 25% so far this year. In comparison, the Utilities Select Sector SPDR ETF (XLU) has risen 12%, and the S&P 500 has risen 14% in the same period. Interestingly, since filing for bankruptcy, PG&E stock has risen more than 50%.

In February, PG&E said it believes its equipment probably caused the fire. PG&E reported adjusted EPS of $1.04 for the quarter ending on March 31. In the first quarter of 2018, PG&E reported EPS of $0.91. The utility reported $192 million in wildfire-related costs during the quarter. The company didn’t provide its earnings guidance for 2019 due to uncertainties associated with wildfire-related liabilities.

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