PCG PG&E Corporation

By Maria Armental 

PG&E Corp.'s stock had its largest single-day plunge since the early 2000s after the utility said its equipment malfunctioned last week in an area where California's deadliest wildfire started.

The disclosure, in a securities filing Tuesday, raised questions about whether PG&E -- already on the hook for billions of dollars in damages tied to 2017 fires in the state -- can withstand potential liabilities from the recent fires. The San Francisco company said it had $1.4 billion of insurance coverage for wildfires occurring between Aug. 1, 2018 and July 31, 2019.

If PG&E's equipment is determined to be the cause of the fire, its liabilities could outstrip its insurance coverage, the company said in the filing.

PG&E also said it had exhausted its revolving credit facilities and had roughly a combined $3.5 billion in cash.

Shares recently traded Wednesday at $24.51, down 25% for the day and on track for their largest percentage decline since 2001, according to FactSet data. Shares had fallen as much as 46% in regular trading Wednesday.

PG&E contacted the California Public Utilities Commission to report a power failure in a Butte County transmission line at 6:15 a.m. Pacific Standard Time on Nov. 8, the day the so-called Camp Fire was reported.

State records indicate the Camp Fire, which has claimed the lives of at least 48 people and destroyed 8,817 homes and businesses, started around 6:30 a.m.

California issued an emergency declaration last week, and President Trump followed suit on Monday, opening the door for federal relief funds to potentially flow into affected areas.

On Wednesday, PG&E said it had about 900 workers on site to help restore service in the Camp Fire-affected area. Where service can't be restored, the company said, PG&E "is looking at a longer-term rebuild of the system wherever and whenever customers rebuild their homes."

"Right now, our primary focus is on the communities and supporting first responders as they work to contain the fire," Chief Executive Geisha Williams said. "We're getting our crews positioned and ready to respond when we get access, so that we can safely restore gas and electricity to our customers."

California was hit by an energy crisis in 2000 that sent retail electricity prices in southern California to record levels, and generation-capacity shortages forced temporary power outages. State and federal officials stepped in to ensure that suppliers would continue selling electricity to California. PG&E's Pacific Gas & Electric unit went bankrupt in April 2001 after running out of cash to cover soaring electricity costs. At the time, it represented the biggest utility bankruptcy in U.S. history.

Write to Maria Armental at maria.armental@wsj.com

(END) Dow Jones Newswires

November 14, 2018 15:14 ET (20:14 GMT)

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