In a surprising development that could trigger a rebound in the badly battered shares of America's largest utility, California investigators have cleared utility PG&E of involvement in the 2017 Tubbs fire, the second-most destructive fire in California history, which broke out in wine country in October 2017.
Shares were halted on the news that investigators found that the catalyst for the fire was a private electrical system adjacent to a "residential structure."
BREAKING: Cal Fire has determined the 2017 Tubbs Fire was ignited by a "private electrical system" — NOT PG&E pic.twitter.com/wuUwjhTe3D— J.D. Morris (@thejdmorris) January 24, 2019
PG&E shares were halted on the news.
The result comes as PG&E prepares to file for bankruptcy as early as next week because of $30 billion worth of potential liabilities stemming from 2017 and 2018 fires, though without the Tubbs fire, investors can subtract $10 billion from that figure. The Tubbs Fire eventually destroyed thousands of homes and killed 22 people. Still, Cali regulators have already cited PG&E equipment as the catalyst for 17 pf the 2017 fires, while also alleging violations of state law. The finding supports a claim made by PG&E in a federal lawsuit that "customer owned" equipment had been responsible for igniting the fire in Napa.
After the initial halt was lifted, PG&E shares soared 25% before being halted a second time.
Then, after the second halt was lifted, shares surged 78% on the day...before being halted a third time...