PG&E defers $2 billion investment after California wildfire reform stalls

PG&E Corporation will defer about $2 billion of planned 2027 investment after California lawmakers failed to advance proposed reforms to the state’s wildfire-liability framework.

The company has reduced its capital plan to $11.4 billion from $13.4 billion and said the deferral could lower debt-financing needs by about $2 billion. PG&E said safety, compliance and wildfire-mitigation programmes would remain funded.

Some housing and renewable-generation connections, large-load projects and technology upgrades may be delayed. The company will also reassess its 2028–2030 capital investment and rate-base outlooks.

PG&E has begun a strategic review expected to take 12–18 months, covering strategic, regulatory, financial, operational and organisational alternatives. Chief executive Patti Poppe said restoring investment-grade credit was an important objective and that the company could not simply wait for the policy framework to change.

California’s inverse-condemnation rules can leave utilities financially liable for wildfire damage linked to their equipment even when they are not found negligent. Wildfire liabilities contributed significantly to PG&E’s 2019 bankruptcy.

Yahoo Finance reported comments from Mad Money host Jim Cramer that PG&E and Edison International shares had fallen roughly 20 per cent over three days after the reform effort failed. The consequences for PG&E’s financing and investment plans remain subject to the company’s review and the broader regulatory framework.