California Utility Shares Tumble as Wildfire Bill Fails to Ease Liability Risks Reuters – August 31, 2026 Shares of California’s largest electric utilities plunged on Monday after an amended Senate bill failed to meaningfully reduce their exposure to wildfire liabilities or address the long‑term solvency of the state’s wildfire fund. PG&E Corp (PCG.N) dropped 19.7%, Edison International (EIX.N) fell 21.3%, and Sempra (SRE.N) declined 3.4%. In pre‑market trading, PG&E had been down as much as 18.8%, while Edison International slid 19.5%. The amended Senate Bill 492 creates a fund to cover wildfire insurance losses, but it does not include a proposal from Governor Gavin Newsom that would have barred insurers from suing utilities over wildfire‑related claims. Wall Street’s main concern is that the revision fails to shift liability away from the utilities. Governor Newsom said in a statement: “We reached a compromise that blocks hedge funds from profiteering off wildfire survivors, bars utility executives from taking bonuses when their company ignites a fire, and gets money into survivors’ hands faster.” The legislation preserves insurers’ ability to recover wildfire‑related payments from utilities and prohibits private equity groups from buying wildfire claims or funding wildfire advertising. However, Mizuho analysts noted that the bill does not create a mechanism to replenish the wildfire fund and does not separate utility liability from the fund’s solvency. Mizuho downgraded all three utilities to “neutral” from “outperform.” BMO Capital Markets said the bill does not ensure the fund’s long‑term viability or protect utilities from wildfire‑driven bankruptcies, and cut PG&E to “market perform” from “outperform,” with a new $21 price target that assumes uncapped future wildfire liability after 2030. PG&E emerged from bankruptcy in 2020 after its equipment was linked to several deadly fires. California had previously set up a $21 billion Wildfire Fund to help cover future claims, while utilities have pushed for broader reforms to reduce their cost exposure. The bill does allow the Continuation Account administrator to issue bonds to support the account and related operations.