PG&E launches review, defers $2 billion in spending after wildfire bill setback

PG&E Corporation (PCG) announced a strategic review to evaluate its structure and financing options, aiming to reduce costs and attract investment. The company plans to defer $2 billion of 2027 investments, reducing debt financing needs. PG&E reaffirmed its 2026 earnings guidance of $1.64-$1.66 per share and initiated 2027 guidance of $1.78-$1.82 per share. The review seeks to maintain safety, improve affordability, and strengthen reliability.

California lawmakers adjourned without passing a wildfire bill, which utility companies and Gov. Newsom deemed insufficient. PG&E (PCG) and Edison International (EIX) shares rose 6% and 8.9% respectively, rebounding from Monday's declines. The bill aimed to address wildfire costs and liability but lacked key provisions sought by utilities and insurers.

California's Senate Bill 492, which aimed to expedite compensation for wildfire victims, failed to pass after utilities opposed it. The bill's defeat led to stock price recoveries for Edison International (up 9%) and Pacific Gas & Electric (up 6%). Utilities sought more protection from wildfire costs, while critics argued they should prevent fires rather than seek bailouts. Investigators linked Edison's equipment to the 2024 Eaton fire, yet the company's profits surged over 200% in 2025.

California lawmakers failed to pass a bill that would have limited utility companies' liability for wildfire damages. Governor Newsom had negotiated a compromise, but the Assembly did not vote on it. Utility stocks, including PG&E and Edison, fell as investors reacted to the news. The bill's failure was seen as a victory for fire survivors, consumer groups, and insurers.

California's wildfire liability plan, SB 492, failed to pass in the Assembly. Edison International and PG&E opposed the bill, citing potential higher rates and lawsuits. Their shares rebounded after the bill's defeat, with Edison gaining 7.3%. The companies had lost over $20 billion in value earlier. The bill's failure was attributed to the utilities' unwillingness to compromise.

Joy Chen and Jamie Court criticized the failure of SB 492, a utility bailout bill, citing its rejection by legislators. They attributed recent stock price declines of PG&E (20%) and Edison International (23%) to Wall Street's lack of confidence in their wildfire risk management. The statement highlighted the companies' role in costly wildfires and their substantial profits, urging them to focus on prevention rather than seeking bailouts.