Court Rebuffs PG&E Ratepayers -- WSJ
May 30 2019 - 3:02AM
Dow Jones News
By Soma Biswas
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (May 30, 2019).
The bankruptcy court presiding over PG&E Corp.'s chapter 11
case denied California ratepayers' attempt to gain a seat at the
negotiating table as an official committee.
In papers filed Tuesday, Judge Dennis Montali ruled that
ratepayers aren't creditors and don't need separate representation
apart from the official committee of unsecured creditors or the
official committee of tort claimants.
At a hearing earlier in May, Cecily Dumas, the lead lawyer for
the official committee of wildfire victims, told Judge Montali that
customers fear PG&E's bankruptcy will end in higher rates for
electricity.
Official committee status would entitle ratepayers to hire
professionals and to send the bill to PG&E. In addition to its
own lawyers and advisers, PG&E in bankruptcy is required to pay
for lawyers and advisers for other official committees.
PG&E damages from wildfires last year could prove to be
higher than $30 billion, the fire victims have said in court
papers. With more than $24 billion owed to bondholders, lenders and
other creditors, PG&E might have to raise rates if it wants to
emerge from chapter 11 with all its debts paid.
Moody's Investors Service, in a report earlier this year, also
cited the possibility that PG&E's customers will see higher
bills because of the utility's fire damages.
The Utility Reform Network, an organization that represents
California ratepayers that was pushing in court for the appointment
of an official ratepayers' committee, argued that ratepayers are
creditors because they are entitled to a semiannual credit on their
utility bills worth over $450 million. The semiannual credit,
however, doesn't qualify as a claim in bankruptcy because the court
already has entered an order permitting PG&E to continue
applying those credits, and the credits are mandated by the
California Public Utilities Commission and a state law, according
to Judge Montali's decision.
Write to Soma Biswas at soma.biswas@wsj.com
(END) Dow Jones Newswires
May 30, 2019 02:47 ET (06:47 GMT)
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