Investigators determined that a tree came into contact with PG&E’s power lines near the Cresta Dam, about 100 miles north of Sacramento, sparking the fire.
The Kincade fire burned almost 78,000 acres in Sonoma County, injured four people and destroyed 374 buildings. In December, state regulators fined PG&E $125 million in connection with the fire.
“Although criminal charges are dismissed, the level of punishment and oversight provided by this judgment is greater than could be achieved against a corporation in criminal court,” said Jill Ravitch, the district attorney for Sonoma County, the site of the Kincade fire.
Ms. Ravitch said the decision to reach a settlement also resulted from a failure by state lawmakers to pass laws to increase penalties for corporations found in violation of the law. She added that the state attorney general, Rob Bonta, declined to bring any legal action against PG&E.
Mr. Bonta did not immediately respond to a request for comment.
PG&E said it was working to increase its accountability and transparency to the public, which the settlement would continue to help improve.