The damage caused by California’s wildfires is now being felt beyond the United States. Canada’s state-owned wealth manager, Alberta Investment Management Corporation (AIMC), has lost around half the value of its investment in energy utility Pacific Gas and Electric Company (NYSE: PCG) since the beginning of the month.
While the price AIMC initiated the position in PG&E remains unclear, during the period between July 1 and Sept. 30, it could have ranged anywhere between a high of $23.56 and a low of $9.42. With the price of the utility stock at 14:55 UTC being $5.82, this means the value of AIMC’s investment in PG&E has fallen by anywhere between 75% and 38%, depending on when the purchase was made. In absolute terms, that’s a loss of between $10,750,440 and $2,181,600.
As of Dec. 31, 2018, the state-owned wealth manager had assets worth C$108.2 billion ($82.3 billion) under management.
The wildfires have forced PG&E to cut off power distribution to some areas of California. This year the stock has suffered after being forced to file for Chapter 11 reorganization as the potential of massive legal bills from wildfires that occurred in 2018 and 2017 rose.
And even after conducting the power shutoffs, the utility has come under fire with its old equipment being blamed for causing the fires. The critics have included California Governor Gavin Newsom, who stated:
“The biggest and most stubborn reality is utilities and they have to modernize their equipment and have to get this thing through bankruptcy and come on the other side as a completely re-imagined operation as more resilient and more safety-focused.”
Besides the liabilities the energy utility might incur over the wildfires, PG&E has also suffered revenue losses; it has shut down electricity distribution to hundreds of thousands of commercial and residential customers.
Earlier this month when the planned power outages were initially announced, CCN.com estimated that PG&E was losing approximately $216,000 per hour. The calculations were based on disconnections to about 800,000 customers.
Last modified: September 23, 2020 1:13 PM