California Lawmakers Adjourn Without Voting on Wildfire Bill

PG&E Corp shares fell 10.1% after cutting its capital plan and launching a strategic review. California's Senate Bill 492 lacked expected liability protections, leading to analyst downgrades and a 52-week low of $12.63. The broader market showed minimal impact, with the S&P 500 up 0.3%.

PG&E will defer $2B in 2027 spending, reducing its capital plan to $11.4B, as it conducts a strategic review due to wildfire liability concerns. The company faces uncertainty over liability costs after a Senate bill amendment failed to address long-term solvency issues. CEO Patti Poppe stated the current framework creates financing risks and higher costs. The review aims to reduce customer costs and debt financing needs by $2B.

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'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.