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Continued Toll on Coal; More Companies File Bankruptcy

December 5, 2020

The post Continued Toll on Coal; More Companies File Bankruptcy appeared first on POWER Magazine.

The struggling U.S. coal industry, decimated by falling demand for the fuel from the power generation sector, and hit hard by low prices during the coronavirus pandemic, saw two more mining companies declare bankruptcy this week.

White Stallion Energy, which operates in Indiana and Illinois, and Lighthouse Resources, a coal company with mines in Wyoming and Montana, filed for bankruptcy in the U.S. Bankruptcy Court in Wilmington, Delaware, on Dec. 2 and Dec. 3, respectively. The U.S. Energy Information Administration (EIA) has reported that the nation’s power sector consumed 30% less coal in the first half of 2020 than during the same period last year, as demand for electricity fell due to the pandemic, and natural gas and renewable energy continued to take market share from coal.

“In light of the challenging market conditions and other impacts on our business from COVID-19, we have been required to reduce costs and reorganize our business, resulting in the reduction of our workforce in Montana,” Lighthouse CEO Everett King said in a statement.…

Judge Approves PG&E Bankruptcy Exit

June 22, 2020

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The post Judge Approves PG&E Bankruptcy Exit appeared first on POWER Magazine.

A federal judge in California has approved Pacific Gas & Electric’s plan to exit bankruptcy, clearing the way for the utility to compensate victims of a series of wildfires in the state that left more than 100 people dead in 2017 and 2018.

The action by U.S. Bankruptcy Judge Dennis Montali on June 20 authorized $ 13.5 billion in compensation for more than 70,000 businesses and homeowners for losses sustained during the fires, which officials said were started by PG&E’s equipment. The company will emerge from bankruptcy with about $ 40 billion in debt, after agreeing to settle claims from people, insurers, and local government agencies for $ 25.5 billion.

Montali’s approval also will allow PG&E to take part in a $ 20 billion state fund established by lawmakers, designed to help utilities operating in the state cover liabilities from future wildfires attributed to their transmission lines and other equipment. …

PG&E Asks Bankruptcy Judge to Back Restructured Power Deals

August 2, 2019

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California utility Pacific Gas & Electric (PG&E) has asked the judge overseeing its bankruptcy case to support restructured deals with some of the utility’s power suppliers in an effort to reduce the price PG&E pays for those companies’ electricity.

The fate of $ 42 billion worth of long-term power purchase agreements (PPAs) is a key component of PG&E’s bankruptcy and is being closely watched by the power industry, which relies on long-term power contracts to attract financing.

PG&E’s court filing comes just weeks after California Gov. Gavin Newsom signed into law a measure to create a $ 21 billion state wildfire fund, designed to help the state’s three investor-owned utilities pay for damages resulting from wildfires in the state.

Allan Marks, a partner in the Los Angeles office of global law firm Milbank LLP, working in Milbank’s Project, Energy and Infrastructure Finance practice, told POWER, “In general, [the wildfire fund] is designed to provide liquidity if utilities aren’t able to handle wildfire claims without becoming insolvent.”…

PG&E Files for Bankruptcy, Prepares to Reorganize

January 30, 2019

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California utility Pacific Gas and Electric (PG&E) filed for Chapter 11 bankruptcy on Jan. 29, as the company faces as much as $ 30 billion in potential liabilities for its role in a series of wildfires in the state. The filing was expected after the company notified its workers two weeks ago it was preparing a reorganization plan.

PG&E is working on a multibillion-dollar debtor-in-possession financing deal with several banks to provide the company funding to continue operations during its reorganization. The California Public Utilities Commission approved the company’s plans to tap up to $ 6 billion in financing to help it operate while under bankruptcy protection, and the company in a statement Tuesday said it will ask the bankruptcy court to approve $ 5.5 billion in financing.

John Simon, PGE’s interim CEO, said in a statement, “We are fully committed to enhancing our wildfire safety efforts, as well as helping restoration and rebuilding efforts across the communities impacted by the devastating Northern California wildfires.…

PG&E Says It Will File Chapter 11 Bankruptcy

January 22, 2019

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California utility PG&E Corp. on Jan. 14 gave its workers the state-required 15-day advance notice of its intent to file a Chapter 11 bankruptcy. The company on Monday said its electric and natural gas service to customers should not be impacted during its reorganization, which comes as PG&E faces billions of dollars in liabilities related to the role of its equipment in a series of deadly wildfires over the past two years.

The company late Sunday said that PG&E CEO Geisha Williams had stepped down, with John Simon named interim CEO. PG&E’s board said it would search for a new chief executive with “extensive operational and safety expertise.” Williams had been CEO since 2017. Simon has held various roles with the company since 2007, most recently as executive vice president and general counsel.

PG&E in a news release Monday said the company “and its wholly owned subsidiary Pacific Gas and Electric Company currently intend to file petitions to reorganize under Chapter 11 of the U.S.…

Troubled FirstEnergy Companies Seek Bankruptcy Protection

April 3, 2018

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FirstEnergy Corp.’s competitive arm FirstEnergy Solutions (FES) and several key subsidiaries, including FirstEnergy Nuclear Operating Co. (FENOC), on March 31 sought Chapter 11 bankruptcy protection. FirstEnergy said the move would facilitate an “orderly financial restructuring” and accelerate its strategy to become a fully regulated utility.

FES—the parent company of FE Aircraft Leasing Corp., FirstEnergy Generation, FirstEnergy Nuclear Generation—along with FirstEnergy Generation Mansfield Unit 1 Corp., Norton Energy Storage, and FENOC filed the voluntary petition seeking relief under Chapter 11 with the U.S. Bankruptcy Court for the Northern District of Ohio.

In aggregate, the companies have about $ 3.8 billion of funding indebtedness. FES, which sells power and related services to retail and wholesale customers in Illinois, Maryland, Michigan, New Jersey, Ohio, and Pennsylvania, in December 2017 reported total assets, liabilities, and capitalization of about $ 5.5 billion, but brought in revenues of about $ 3.1 billion.

FES holds about $ 1.5 billion of funded indebtedness, including a $ 700 million secured revolving credit facility; about $ 332 million of 6.05% of unsecured notes, which are due in 2021; about $ 363 million of 8.80% unsecured notes due in 2039; and a $ 150 million revolving credit note with Allegheny Energy Supply Co.,…