(Deletes incorrect reference in paragraphs 8 and 9 to PG&E potential liability for fires in Southern California)
By Dan Levine
SAN FRANCISCO, Jan 9 (Reuters) - A U.S. judge on Wednesday proposed restricting utility PG&E Corp from using power lines deemed to be unsafe during high winds in the 2019 California fire season, adding another complication for the California utility as it faces billions of dollars in wildfire liabilities.
In an order, U.S. District Judge William Alsup in San Francisco also proposed that PG&E be required to reinspect its grid and "remove or trim all trees that could fall onto its power lines."
The judge is overseeing conditions of PG&E's probation following a 2010 gas pipeline explosion, and directed the company to respond to his proposed order by Jan. 23. Alsup scheduled a hearing for Jan. 30.
PG&E is exploring filing some or all of its business for bankruptcy protection as a contingency, in part because it could soon take a significant financial charge for the fourth quarter of 2018 related to liabilities from fatal wildfires in 2017 and 2018, Reuters reported last week. A bankruptcy filing is not certain.
"We are aware of Judge Alsup's orders and are currently reviewing," a PG&E spokesman told Reuters in an emailed statement.
Alsup said the goal of modifying PG&E's probation to include the new power restrictions was to eliminate the number of wildfires caused by PG&E in 2019.
"This will likely mean having to interrupt service during high-wind events (and possibly at other times)," Alsup wrote, "but that inconvenience, irritating as it will be, will pale by comparison to the death and destruction that otherwise might result from PG&E-inflicted wildfires."
PG&E said in November it could face "significant liability" in excess of its insurance coverage if its equipment was found to have caused last year's Camp fire in Northern California.
The Camp blaze killed at least 86 people, incinerating most of the Sierra foothills town of Paradise, 175 miles (280 km) north of San Francisco.
PG&E also faces dozens of lawsuits from owners of homes and businesses that burned during 2017 fires. (Reporting by Dan Levine; Additional reporting by Kanishka Singh in Bengaluru; Editing by Chris Reese and Peter Cooney)