Pacific Gas & Electric Files for Bankruptcy

Pacific Gas & Electric, the financially troubled utility unit of PG&E (PCG Quote), filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code on Friday, saying that its unreimbursed energy costs are now increasing by more than $300 million a month.

The filing doesn't affect PG&E or the parent company's other units, including National Energy Group.

"We chose to file for Chapter 11 reorganization affirmatively because we expect the court will provide the venue needed to reach a solution, which thus far [California] and the state's regulators have been unable to achieve," Pacific Gas & Electric said in a press release. "The regulatory and political processes have failed us, and now we are turning to the court."

The San Francisco-based utility plans to continue normal electric and gas transmission and distribution functions during the Chapter 11 process.