In the coming months it’s a guarantee PG&E is going to burn a lot more people.

This time we’re not talking about customers, although that could easily happen, but rather those that own 518.67 million outstanding shares of PG&E stock.

The decision to file for bankruptcy in the next few weeks will mean countless people are going to be shedding wealth all so PG&E can stay intact as a venue for the utility’s executive suite occupants to keep their fat paychecks coming and so they can bail with platinum parachutes with rip cords lines with diamonds.

Shareholders that include a lot of funds that middle class and working class folks are relying on for their retirement typically end up on the short end of the stick in bankruptcy. It is fairly common for them to be wiped out since creditors are paid before equity owners.

It helps explain why PG&E stock was selling for about the price of a fancy Starbucks latte on Thursday at $6.36 a share. That compares to $48.80 a share before the Town of Paradise was wiped off the map, 86 people killed, and 14,000 plus homes destroyed. PG&E managed to wipeout 87 percent of the wealth their shareholders held at the start of October in just three months.

BlueMountain Capital Management holds about 11 million shares of PG&E stock that are just a tad more valuable than Washington Mutual Bank stock. The firm unlike other hedge funds that own PG&E stock has a healthy disrespect for upper echelon management at the for-profit utility that has a perfect recorded of botched management documented back before they were found responsible for blowing up a San Bruno neighborhood and killing eight of their customers and injuring another 54.

BlueMountain on Thursday fired off a letter to PG&E arguing the executives running the company are a little bit too eager to file for bankruptcy. BlueMountain believes PG&E is destroying value unnecessarily. They may have a point.

PG&E has plenty of liquidity and ample income to continue operating. BlueMountain is also correct in noting the potential liability from wildfire related lawsuits is a guess since there has been no court determination whether PG&E is to blame for the wildfires as the state government contends in the case of torching of the Napa Wine Country in 2017. As for Butte County’s wholesale destruction in 2018, the state is only investigating PG&E as the possible culprit at this point.

BlueMountain is right to note that the $30 billion in liability that PG&E believes they are facing is only a guess at best given no trial has even determined the scope of the verdicts PG&E could face.

And here’s the kicker — BlueMountain points out there are “meaningful probabilities” of offsets from settlements and other cost recovery.

Along with those offsets is the selling off of segments of its system.

The PG&E retail electrical service covering Manteca, Escalon, and Ripon comes to mind.

The last offer South San Joaquin Irrigation District made to buy the retail system before the district opted to exercise its right under the California constitution to go to court using eminent domain to force a sale for the public good was for around $130 million. 

Not only would that put $130 million on PG&E’s ledger sheet to help pay off liabilities, but the cost of replacing aging components of the local retail delivery system would shift to SSJID, they could eliminate the expense of high-powered Los Angeles attorneys to fight SSJID, and free their floor full of attorneys at 555 Beale Street in San Francisco to concentrate on wildfire lawsuits.

Selling parts of the system now when PG&E still has the freedom to pick and choose what they want to shed before a bankruptcy court may make the decision for them, would put PG&E in a better position not only to protect their shareholders’ investment but to also pay those that they may be found to have legal culpability in destroying their property or killing their loved ones. A forced fire sale, so to speak, could cost PG&E large swaths of the heavily urbanized Bay Area where high densities mean more customers per mile that in turn makes it less expensive to serve and easier to earn profit. Besides, there are a lot of underground lines in the Bay Area that reduces PG&E’s future exposure to wildfires.

Over the years a number of rural areas have broken away from PG&E using the path SSJID is now on via eminent domain including Trinity Public Utilities, Hayfork Public Utilities District (now part of Trinity) and part of what is now the Lassen Public Utilities District. They’ve managed to improve service, reduce rates, and maintain power lines without burning down their respective communities.

Let’s also keep in mind the City of San Francisco wants to buy the retail distribution system PG&E operates in their city, the PG&E corporate headquarters building at 555 Beale Street in San Francisco is worth more than $1 billion, Sacramento Municipal Utility District (SMUD) wants to buy the retail territory from PG&E that serves Davis, and PG&E is sitting on $1.5 billion in reserves. Between those alone and a sale to SSJID the odds are PG&E could come close to generating $30 billion to pay their projected legal liabilities from wildfires.

Those moves would make for a leaner PG&E that would have value to shareholders — a majority of their retail distribution system, their natural gas operations that aren’t being ravaged by the switch to solar power, and their electrical generation portfolio.

So why is the brass at PG&E hell-bent on pursuing bankruptcy and apparently against exploring the strategic selling of parts of the system that would arguably could make them more profitable in the long run and reduce their wildfire exposure at the same time?

Here are the reasons:

u$2.5 million severance package for Geisha Williams who was CEO during the Napa Valley (2017) and Butte Fire (2018).

u$6.9 million severance package for Nick Stavropoulos who was head of gas operations and then president/chief operating officer from 2012 and 2017 when PG&E has been accused of falsifying gas line records in the aftermath of the San Bruno settlement.

u$34.7 million severance package for Peter Darbee who was CEO when PG&E leveled the San Bruno neighborhood.

u$10.4 million severance package for Anthony Early who was CEO prior to Williams and was the head honcho when PG&E was accused of falsifying gas pipeline records.

If you haven’t noticed the only people really profiting from how PG&E has been run since before the boatload of lies they sold to the California Legislature to secure deregulation so they could sell all of their assets to themselves to generate more money to fatten their compensation packages plus write off their assets for a second time are those in the executive suite. It’s not the hardworking men and women of PG&E that toil 24/7 to keep our lights on and homes warm. Nor is it customers that PG&E has blown up or the customers they are accused of burning to death. And nor is it the shareholders that PG&E executive are all too eager to burn while they milk the company for every last cent as well as award their buddies with fat severance pay packages after they managed to increase PG&E financial liability significantly before departing to live the life of leisure.

CORRECTION: Thursday’s column “The Great Flood of 1861-62 & the need for 200-year flood protection” incorrectly started the last flood in rural south Manteca was in 1992. It was in 1997.