SACRAMENTO >> Four California legislators on Monday said they will introduce legislation to prohibit electric utilities found liable in wildfires from passing the costs for claims not covered by insurance — as well as fines or penalties — onto its customers.
The announcement comes after a recent Bay Area News Group report that Pacific Gas & Electric Company has been aggressively urging state regulators to make it easier for the company to charge ratepayers — rather than its shareholders — when its power lines and other electrical equipment cause wildfires.
Democrat Senators Jerry Hill of San Mateo, Mike McGuire of Healdsburg, Scott Wiener of San Francisco and Assemblyman Marc Levine of Marin County said they will propose the bill when the Legislature convenes in early January.
“This practice is an outrage,” said Hill in a statement. “It’s time to stop allowing utilities to push the burden of their negligence onto the backs of customers.”
McGuire, whose district includes communities ravaged by the wildfires this month, said the idea that residents “suffering from this massive tragedy should ever pay for a corporation’s potential negligence” is “simply unconscionable.”
Wiener added: “You don’t burn someone’s house down and then raise their rates to help pay for the damage you caused.”
PG&E did not immediately return a request for comment from the Bay Area News Group.
The cause of the North Bay fires that killed 42 people, destroyed 8,700 homes and buildings, and burned tens of thousands of acres has not been determined.
But the Bay Area News Group story pointed to a 30-minute meeting on Oct. 17, when Meredith Allen, PG&E’s senior director of regulatory relations, told Travis Foss, an adviser to PUC Commissioner Clifford Rechtschaffen, that PG&E and other California utilities are in “an untenable situation,” according to a record of the meeting that PG&E sent to the PUC as required under state lobbying rules.
PG&E should not have to pay “a disproportionate” share of the costs of wildfires because of the growing fire risk and a tough insurance market, Allen argued.
Attempts by utilities to recoup financial losses aren’t new.
San Diego Gas and Electric Company is seeking to recover $379 million in costs from three wildfires in 2007. The utility’s power lines and overhead equipment were blamed for the blazes that caused two deaths, burned 200,000 acres and destroyed more than 1,300 homes.
Separately, PG&E is laying the groundwork for an application to recover costs in the 2015 Butte fire, which was caused by PG&E powerlines and killed two people, burned more than 70,000 acres and destroyed 921 structures.
Gas companies are already prevented from shifting the burden of fines and penalties onto customers as a result of legislation he introduced after the San Bruno disaster that was caused by the rupture of a PG&E gas pipeline in 2010. The legislation, Assembly Bill 56, was approved by the governor in 2011.
