California legislature considers utility fire liability changes

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The fires ravaging California this morning are a stark reminder that last year’s horrific blazes were no fluke. They are the new normal. Figuring out how to live with this reality is the most pressing task in front of the California legislature when it reconvenes later today.

One of the many issues is who pays?

Under California law, if the cause involves an electric utility’s infrastructure, then it has to pay for the full cost of the damage, whether it was fully, or even truly, at fault. And whether or not it was negligent. By one reckoning, Pacific Gas & Electric’s shareholders face a $12 billion tab from last year’s fires alone. Southern California Edison is in the same boat. It’s natural to want someone else to pay for any kind of damage suffered by the public, but there’s also the question of how to keep electricity flowing in California, at affordable rates and in a sustainable manner. Assessing the liability of electric companies as you would for any other business is one way to balance those interests.

Before they left for their summer vacation, key lawmakers agreed with governor Jerry Brown to fast track a solution. While they were gone, Brown released a draft of his preferred approach. According to the proposed bill’s summary…

In a civil action…against an electrical corporation or a local publicly owned electric utility seeking damages arising from an unintended fire that occurred on or after January 1, 2018, when electrical infrastructure is a substantial cause of the fire, this bill would require the court to balance the public benefit of the electrical infrastructure with the harm caused to private property and determine whether the utility acted reasonably.

Telecoms companies can be hit with the same kind of liability claims, as Cox Communications was for a 2007 fire in San Diego County. And they rely on pole routes that are largely built and maintained by electric companies. The top priority has to be the safety of all Californians, but maintaining affordable access to modern electric and telecoms service is important too.