Former PI lists a non-contributor as first author on a manuscript for which I did all the work. Next steps?
Before you get upset, I think it would be important to learn more about the actual circumstances of the publication.  I say this because, based on your description of the situation in your post you haven't been acting like a first author.
You may indeed have done all of the initial work on which the manuscript was based, but based on what you have written, you don't seem to have been particularly involved in interpreting the results or writing them up (beyond the methods section).
The first author of a paper, in typical usage for the field, should be involved in every stage of the project and the production of the manuscript. From what you have written, it appears that you haven't been, and so you may not even be properly aware of what the other student may or may not have done for the project. Maybe your speculation is correct; maybe it is not. Ultimately, however, authorship order isn't really your call, because you have chosen not to lead work on the paper.
If you want to be first author on a paper, you need to involve yourself more deeply with the project, including the actual scientific interpretation of the results.
Now, if you are concerned that your former PI may be acting unethically, you can ask for a description of the work that the other student has done. Do this from a perspective of curiosity and surprise, rather than accusation.  Once their work has been described, if you disagree with your former PI's judgement, then voice your concerns. If your PI doesn't make a change after that, you can withdraw yourself from the paper --- you should not lend your name to something that you consider unethical.  But based on what you described, it's not really your paper, and in the end your choice is primarily about whether or not to be associated with it.