Shares of PG&E Corp. (PCG) soared by nearly 38% by Friday's close after the head of California's Public Utilities Commission was quoted as saying he couldn't imagine allowing the state's largest utility to go into bankruptcy in the face of potential liability from the state's deadly wildfires.
Bloomberg quoted PUC President Michael Picker as saying that "it's not good policy to have utilities unable to finance the services and infrastructure the state of California needs. They have to have stability and economic support to get the dollars they need right now." Bloomberg, citing a person familiar with the matter, said that Picker made the comments during a conference call hosted by Bank of America Corp.
PG&E warned on Tuesday that it could face liability that exceeds its insurance coverage if its equipment caused the Camp Fire in Northern California, which destroyed the town of Paradise a week ago. The Camp Fire and the Woolsey Fire in Southern California are still burning, with 71 people confirmed dead and hundreds more missing. A total of 9,844 homes and 336 businesses are destroyed, along with 2,076 other buildings, according to fire officials.
The CPUC didn't immediately respond to a request for comment, but the Bloomberg report helped send PG&E shares up nearly 38% to $24.40 shortly by market's close on Friday. PCG had fallen 65% intraday in recent days, dropping from as high as $49.42 on Nov. 7 before the Camp Fire began to as low as $17.26 on Thursday before Bloomberg reported Picker's comments.
(This article has been updated.)