Utility stocks plummet as California wildfires spread

SAN FRANCISCO (Reuters) - Shares of California power utilities plummeted on Friday as wildfires in California left thousands of customers without gas and electricity.

A Pacific Gas & Electric lineman cuts a downed power line during the Camp Fire in Paradise, California, U.S. November 8, 2018. REUTERS/Stephen Lam

PG&E Corp PCG.N, which operates in the northern part of the state, sank 15 percent and was on track for its biggest one-day decline since 2002. Edison International EIX.N, the owner of Southern California Edison Company, dropped 13 percent.

PG&E was blamed for wildfires in 2017 that ravaged wine country north of the San Francisco Bay area and killed 46 people, and this week’s fires create new uncertainties for investors in California’s utilities.

In June, PG&E said it would record a $2.5 billion in pre-tax expenses for the second-quarter related to last year’s fires after a report said some of them were sparked by trees toppling into PG&E power lines.

Three wind-whipped wildfires burned, with one in the northern part of the state advancing to the outskirts of the city of Chico, forcing thousands to flee after it left the nearby town of Paradise in ruins.

Voluntary evacuations of 75,000 homes were called for in Ventura County northwest of Los Angeles because of a spreading fire, while parts of the oceanside city of Malibu, about 30 miles (48 km) west of downtown Los Angeles, were under evacuation orders.

PG&E said in a statement on Friday that 25,000 customers in Butte County were without electricity due to the fire near Chico. It said it turned off gas to about 12,000 customers.

Southern California Edison said on its website it notified 74,000 customers that it could shut off their electricity if high winds create a danger of power lines starting a fire.

Both utilities said the causes of the fires were not yet determined.

In September, the state passed a bill allowing PG&E to pass on to customers some of the costs incurred from liabilities related to wildfires and protect it from going out of business.

Shares of PG&E have lost 40 percent since early October 2017, when the fires broke out.

Reporting by Noel Randewich; editing by Diane Craft and Cynthia Osterman