Shares of PG&E drop after Calif. governor rejects settlement

Shares of the California utility PG&E are down 15.8% in the first day of trading since Gov. Gavin Newsom rejected a $13.5 billion settlement with people who lost homes, businesses or worse.

A series of devastating fires has already driven the nation’s largest utility into bankruptcy.

The decision by Newsom on Friday is a major setback in the utility’s race to meet a June 30 deadline to emerge from bankruptcy protection.

Pacific Gas & Electric, based in San Francisco, needs to craft a deal before it can draw from a special fund created by the Democratic governor and state lawmakers to help insulate utilities if their equipment sparks other catastrophic fires.

U.S. Bankruptcy Judge Dennis Montali would have to approve a settlement by Dec. 20 for the deal to become part of PG&E’s official plan to regain its financial footing.

The Associated Press