Bonds of PG&E Corp. and Edison International weakened Monday after California lawmakers rejected a key provision of Governor Gavin Newsom's plan to shift wildfire liabilities from the state's utilities. The spread on PG&E's 6.3% bonds maturing in 2056 widened 15 basis points to 138 basis points as of 8:43 a.m. in New York, according to Trace. Meanwhile, Edison International's 4% notes due in 2047 widened by 10 basis points to 133 basis points.

The legislative setback renews investor concerns over the financial exposure of California utilities to catastrophic wildfire damages. The decision underscores the ongoing tension between utility balance sheets and state wildfire policy. Analysts suggest the widened spreads reflect heightened credit risk perception.

The market reaction highlights the sensitivity of utility debt to regulatory and legislative developments in California.