California utility giants PG&E Corp. and Edison International gained on Tuesday as state policy makers advanced a bill that would address their future wildfire liabilities.
An amended version of the legislation now being weighed by California’s Senate would shield utilities that comply with approved safety plans in state proceedings should one of their power lines spark a wildfire. They’d remain subject to potential civil lawsuits, and the bill wouldn’t be retroactive – meaning PG&E and Edison could still face billions of dollars in costs from wildfires that destroyed thousands of structures last year.
Both PG&E and Edison rallied on news of the amendment Tuesday as it offers investors some clarity as to how California’s utilities will be held responsible for wildfires that have intensified amid warmer temperatures and drier weather. Analysts have estimated that wildfires that broke out last year alone could cost PG&E more than $15 billion in claims and Southern California Edison more than $4 billion. The scale of the destruction by the fires and the uncertainty around whether the utilities will be stuck with the bill have wiped out billions of dollars of market value from both companies.
Several groups including California State Association of Counties said they supported the bill as amended because a previous version had broadly protected utilities against wildfire liability. The bill passed Tuesday out of the Senate’s governmental organization committee.
The amended text should be available in print by the end of next week, said Paul Payne, a spokesman for state Senator Bill Dodd, a sponsor of the bill. Under the legislation, utilities would have to submit safety plans to reduce the risk of events such as wildfires to state regulators every two years.
State Senator Jerry Hill was the lone vote against the bill’s passage out of the committee. He said he remained concerned that the legislation would hold consumers accountable for wildfire costs and not the utilities.
Was this article valuable?
Here are more articles you may enjoy.