"While we are making progress as a company in safety and other areas, the board recognizes the tremendous challenges PG&E continues to face", the company said. The company has said it expects to have about $5.5 billion in financing in place to help ongoing operations during a reorganization.
PG&E's shares plummeted more than 48 percent during morning trading Monday. The announcement comes after the company has claimed liability for the 2017 and 2018 Northern California wildfires.
Mark Toney, executive director of consumer advocate group the Utility Reform Network, said the atmosphere had cooled considerably toward PG&E in recent months, making a bailout politically more hard for lawmakers.
PG&E, which is the nation's largest utility by revenue and is based in San Francisco, said it is giving the required 15 days' notice that it plans to file for bankruptcy protection at the end of the month.
"The people affected by the devastating Northern California wildfires are our customers, our neighbours and our friends, and we understand the profound impact the fires have had on our communities and the need for PG&E to continue enhancing our wildfire mitigation efforts", Simon said on Monday.
If all the parties involved can't negotiate, PG&E will have to come up with a reorganization plan for how much each party that is owed will receive.More news: How Meghan Markle Reacted to Stranger Calling Her 'A Fat Lady'
More news: Game of Thrones first teaser released | Jon Snow, Arya, Sansa appear together
More news: Democrats seize House control as divided US Congress gets to work
State officials are investigating whether the utility's equipment sparked the deadliest, most destructive wildfire in California history, a November blaze that killed at least 86 people and burned down 15,000 homes.
California law compels utilities to pay for damages from wildfires if their equipment caused the blazes - even if the utilities weren't negligent through, say, inadequate maintenance.
A shortwave infrared (SWIR) satelite image of the Camp Fire in Magalia, Paradise, California, November 9, 2018. PG&E stated the corporate had initiated a search to interchange the highest official, Geisha Williams, who had led the utility since 2017.
Action News Now reporter Christina Vitale spoke with a lawyer to break down what bankruptcy means for the company. "I have directed the San Francisco Public Utilities Commission to study any near and long-term impacts this bankruptcy will have on our city and to identify any and all options we have to ensure that everyone in San Francisco has access to clean, safe, and reliable power". A number of the fires have been attributed to energy traces' coming into contact with bushes, which critics have mentioned is a result of the utility's failure to trim the bushes.
It is believed the fire was started when a PG&E power line came in contact with nearby trees. "But victims' interests won't be served by pushing utilities into bankruptcy, converting wildfire sufferers into one more class of frustrated creditors pursuing inadequate funds".
"All Californians sympathize deeply with the victims of our recent catastrophes, which caused dozens of deaths and wreaked unprecedented destruction across the state", said Ralph Cavanagh, California-based energy expert at the Natural Resources Defense Council. "We are not in a situation where the cost of electricity is going to be stable", Wara said, "because of the cost of these fires, and the risks created because of future fires". "Other threatened initiatives involve grid upgrades, small-scale "distributed" resources and technology innovation".