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PG&E slapped with $125 million penalty for sparking 2019 Kincade Fire

PG&E still faces 33 criminal charges in state court for the 2019 fire that destroyed more than 370 buildings and caused the largest evacuation in Sonoma County history.

(CN) — California will impose a $125 million penalty against Pacific Gas and Electric for sparking the 2019 Kincade Fire that burned over 77,000 acres in Sonoma County under the terms of a settlement approved Thursday.

Investigators with the California Public Utilities Commission’s safety and enforcement division found the fire was caused when a worn jumper cable, which was installed in 1973, failed and snapped off a transmission tower near Geyserville on Oct. 23, 2019.

Investigators with Cal Fire had previously determined a PG&E transmission line ignited the blaze. PG&E faces 33 criminal charges, including five felonies, in Sonoma County Superior Court for causing the blaze that injured six firefighters and caused $600 million in insurance losses. This past September, a Sonoma County judge denied PG&E's motion to dismiss 25 air pollution-related charges in the case.

About 200,000 residents from Healdsburg, Windsor, Santa Rosa and Geyserville fled their homes after the Kincade Fire erupted, making it the largest evacuation in county history. The fire destroyed 374 buildings and damaged 60 others, according to Cal Fire.

The CPUC’s five-member board approved a resolution authorizing the settlement in a 3-2 vote Thursday. Commissioners Genevieve Shiroma and Darcie Houcka voted against the measure, arguing the process for approving the deal deserved more scrutiny and public input.

The settlement requires PG&E to pay a $40 million fine, which will go to California’s general fund. The deal also permanently bans the utility from recouping $85 million in costs for removing abandoned transmission equipment in its service area, adding up to $125 million in penalties.

In an emailed statement, PG&E spokesman James Noonan said the company accepts Cal Fire’s finding that a PG&E transmission line caused the Kincade Fire. He said the company is working to make its system safe and resolve claims stemming from past fires sparked by the utility’s equipment.

“While we disagree with SED’s alleged violations, we believe the settlement will assist in allowing all parties to move forward from the fire, and permit us to focus on compensating victims and making our energy system safer,” Noonan said.

The safety and enforcement division said PG&E violated two general orders and one section of the state public utilities code by failing to properly configure the jumper cable and insulator strings at the tower, abandoning energized equipment, neglecting to remove an abandoned line and failing to remediate an improper configuration of jumper cables.

PG&E previously reached settlements with 10 California cities and counties in which it agreed to pay $43.4 million for local areas damaged by the Kincade Fire and the 2020 Zogg Fire in Shasta County. The company faces an additional 31 criminal charges for sparking the Zogg Fire.

The CPUC’s approval of the Kincade Fire penalty comes as PG&E faces mounting scrutiny over its equipment’s role in starting the Dixie Fire this past July. The wildfire burned over 963,000 acres and destroyed more than 1,300 buildings, including much of the town of Greenville in Plumas County.

Last month, PG&E announced in a securities filing that federal prosecutors in the Eastern District of California are investigating its involvement in the Dixie Fire and had subpoenaed the company to turn over documents. The company also revealed it faces a potential $1.15 billion in losses from the blaze, not including potential regulatory penalties, punitive damages or recovery of fire suppression and evacuation costs.

It also comes as PG&E’s criminal probation draws to a close. The company’s five-year probation term, stemming from felony convictions related to the 2010 San Bruno gas pipeline explosion, expires on Jan. 26, 2022.

Senior U.S. District Judge William Alsup has been particularly demanding on PG&E, requiring the utility to answer scores of questions on its suspected role in starting multiple blazes and its efforts to prevent future fires. He also imposed new probation conditions requiring the company to abide by state regulations, meet targets in its state-mandated wildfire safety plan and stop paying dividends to shareholders until it fully complies with wildfire-prevention requirements.

In a report released to the public last week, a federal court-appointed monitor credited PG&E for substantial improvement in its gas safety operations while acknowledging the company’s wildfire prevention work “obviously has been inadequate.”

The report identifies PG&E’s biggest challenges as “near constant turnover” in its leadership team, slow progress improving records integrity and managing contracted labor, following through on long-term safety projects like burying power lines and replacing old equipment, improving wildfire mitigation programs and not backsliding on its gas safety progress.

Under the terms of a deal that allowed PG&E to emerge from Chapter 11 bankruptcy last year, the CPUC will require the utility to hire an “independent safety adviser” that will serve the same role as the federal court-appointed monitor when its probation term ends in January.

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Categories / Energy, Regional

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