SACRAMENTO -- Pacific Gas and Electric announced Monday it is filing for Chapter 11 bankruptcy protection.
The move comes as the utility company faces the possibility of the billions of dollars in liability for California’s recent deadly and destructive wildfires.
Monday's announcement comes just a day after the company said its CEO is stepping down.
"This is gonna be a saga,” Assemblyman Jim Patterson, R-Fresno, told FOX40. “It isn't gonna end quickly."
Patterson is the vice chair of the Assembly's Utilities and Energy Committee. He says the recent, historic wildfires in California have only worsened existing problems with the utility.
This isn't the first time the state's largest utility company has filed for bankruptcy.
"My hope is that the bankruptcy judge will do similarly to what a bankruptcy judge did in 2000, which was to say, ‘PG&E you gotta keep the lights on,'" Patterson said. "Then they've got to figure out a way to either get them out of bankruptcy or liquidate their assets. That's how serious this is."
PG&E says Chapter 11 bankruptcy protection will allow the company to reorganize and try to handle potential liability for wildfires in 2017 and 2018.
In a statement, PG&E’s interim CEO John Simon said the utility understands the effect of recent wildfires on its customers:
“We remain committed to helping them through the recovery and rebuilding process. We believe a court-supervised process under Chapter 11 will best enable PG&E to resolve its potential liabilities in an orderly, fair and expeditious fashion."
While the official cause of the Camp Fire is still being investigated, many are already blaming PG&E. Multiple lawsuits have been filed against the utility on behalf of victims.
"They’re worried. This has been a concern since the beginning,” attorney Mark Potter told FOX40 over the phone.
Potter represents about 70 Camp Fire victims. He's confident bankruptcy won’t change the outcome of their lawsuits.
"It’s not going to wash away all the liability that they have,” Potter said. “They will still pay the claims just as they would outside of bankruptcy court."
The future of the utility is unknown, but Patterson says lawmakers are prepared for the challenges ahead.
“This is a very troubling moment of California history,” Patterson said. “And I think it's gonna be a big test of this legislature and California's governor to work itself through it."
Gov. Gavin Newsom spent the day in meetings with key lawmakers to talk about the impact of PG&E's announcement.
On Monday, the governor held a press conference where he said the company is doing the right thing at this point to keep energy flowing.
"We're not in a position where we're worried about the lights turning out and we're not in a position where we're worried about gas and access to gas," Gov. Newsom said in front of his office. "In fact, PG&E paid a month in advance on their gas purchases as a proof point to that effect."