Shares of PG&E dropped more than 7 percent on Monday as investors fled on worries the giant electric utility company could suffer steep losses if it’s found liable for the Northern California wildfires.

The stock was also trading at levels not seen since January 2016 and was the worst performer in the S&P 500.

PG&E 2-year chart

Source: FactSet

Investors have been selling PG&E’s stock heavily since last week, after the California Public Utilities Commission sent the company a letter reminding them to preserve “all evidence with respect to the Northern California wildfires in Napa, Sonoma and Solano Counties.”

The commission was investigating whether electrical lines that were knocked down by a windstorm on Oct. 8 played a role in sparking the most lethal wildfire event in the state’s history.

PG&E — California’s largest electrical utility — said in an SEC filing Friday it has “$800 million in liability insurance for potential losses that may result from these fires. If the amount of insurance is insufficient to cover the Utility’s liability or if insurance is otherwise unavailable PG&E Corporation’s and the Utility’s financial condition or results of operations could be materially affected.”

Power company lines have been a persistent fire threat in California. It is still not clear if PG&E was to blame for the fires, but it has been found guilty of negligence in previous fires, including the deadly Butte Fire in California’s Amador County in 2015. Cal Fire investigated the fire, which destroyed 549 homes, and ended up sending a bill to PG&E for about $90 million to cover firefighting expenses.

Christopher Turnure, an analyst at JPMorgan covering the stock, said gross liability damages could amount to $12.2 billion in an “extreme case.”

“We assign a 75% chance of PCG being found liable for the Northern California wildfires despite having essentially no information at this time on the cause,” Turnure said in a note to clients Sunday. Turnure also reduced his year-end 2018 price target on the stock to $76 from $66. PCG is the stock ticker for PG&E.

PG&E shares traded near $53 on Monday.

The fires, which started more than a week ago, have killed at least 40 people and destroyed at least 5,700 homes and other structures. As of Sunday, roughly 75,000 people were under evacuation orders, down from nearly 100,000 the day before.

— CNBC’s Jeff Daniels, Christopher Hayes and The Associated Press contributed to this report.

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