Editorials

State files first claim in PG&E bankruptcy

Associated Press
Tuesday September 25, 2001

SAN FRANCISCO (AP) — California’s attorney general filed a $179.4 million claim Monday in the bankruptcy of Pacific Gas and Electric Co., for power the state bought for PG&E customers. 

Other state claims estimated to top $230 million for items such as unpaid taxes and pollution cleanup will be filed by the Oct. 3 deadline, said Attorney General Bill Lockyer. 

Lockyer had earlier advised state agencies not to file any claims in the bankruptcy because it could jeopardize the state’s sovereign immunity, the state’s right not to be sued in federal court. But since the judge had set a deadline for claims, the state had to file or risk not being included in the bankruptcy settlement. 

“In seeking to recover money owed by PG&E, the state of California is limiting its waiver of sovereign immunity as to these claims only,” Lockyer said. 

Lockyer said his office was examining PG&E’s reorganization plan “because of serious concerns that the utility is seeking to evade further scrutiny” from state regulators. 

The first state claim covers electricity purchased by the Department of Water Resources from April 6 to May 31 for PG&E customers. 

The state has been buying power on behalf of PG&E, Southern California Edison and San Diego Gas & Electric Co., since January when generators, alarmed that the utilities had amassed billions in debts, refused to sell electricity to the companies. 

PG&E filed for Chapter 11 bankruptcy protection in April. State lawmakers and Gov. Gray Davis have been trying to craft a deal for Edison that would prevent that utility from following PG&E into bankruptcy.