He said the San Francisco-based utility “worked diligently over many months with multiple parties,” including CPUC’s Safety Enforcement Division, the Coalition of California Utility Employee, and the Office of the Safety Advocate to reach a joint $1.675-billion settlement agreement “that addresses multiple needs and would allow for additional investments to further strengthen the company’s electric operations.”

Noonan added, “We recognize our fundamental obligation is to operate our system safely.”

The announcement marks approval of PG&E’s proposed settlement with the commission’s modifications.

Earlier this month, PG&E filed an updated Chapter 11 restructuring plan after it declared bankruptcy in 2019 amid blame for sparking the November 2018 Camp Fire, which killed at least 85 people and destroyed nearly 19,000 buildings.

CPUC’s modified settlement also requires PG&E to apply any tax savings associated with the shareholder payments, expected to exceed $500 million, to customers. “If no other party appeals the decision and PG&E agrees to the new settlement within 20 days, and no party appeals and no commissioner requests review,” the agreement becomes final, said the commission announcement.

 The $2.137 billion in penalties, liable to shareholders, include:

• $1.823 billion, an increase of $198 million from an earlier settlement agreement, in disallowances for wildfire-related expenses – meaning PG&E shareholders will pay costs it would otherwise seek from customers.
• $200 million for a fine paid to California’s general fund, not included in the proposed settlement agreement.
• $114 million, up $64 million from the settlement agreement, in system enhancement initiatives and corrective actions to include root cause analysis of wildfire ignition involving company facilities and recommendations to prevent similar events; funding for local fire safe councils that focus on community fire prevention and mitigation; and other funding.

Meanwhile, on Feb. 19, a federal judge threatened to withhold performance bonuses for PG&E executives and supervisors for not meeting safety goals related to its 2020 wildfire protection plan, and the top state regulator outlined a process to revoke its operating license if it does not adequately address safety violations.