California Gov. Gavin Newsom has offered up a $21-billion wildfire compensation plan, and at first glance it may appear to be something of a corporate giveaway.
The governor’s idea is to create a state fund to compensate future wildfire victims, when the fire is a result of utility companies’ equipment failures and malfunctions.
The potential giveaway element is that the program would be funded, at least partially, by a surcharge on ratepayers’ monthly electric bills, with the utility companies kicking in the rest of the funding.
The plan has been moved along to the Legislature, which must approve Newsom’s pitch, and it also hinges on the state’s major electric power suppliers to get on board.
SACRAMENTO — Pacific Gas & Electric's key lenders on Tuesday offered a $30 billion plan to pull the utility out of bankruptcy and give the…
In other words, this sort of fund to protect wildfire victims is a good idea, but it has many moving parts that must be reconciled by state lawmakers, utility company officials and, finally, California ratepayers.
There is another question looming over this proposal — is $21 billion enough?
It’s a valid consideration when you consider that 75 percent of the state’s most destructive — and expensive — wildfires in state history have occurred over the past two decades.
That makes sense when you think about California’s explosive population growth, the incursion of humanity on what used to be wild country, the demand for power, the overall effects of climate change, and humans’ unforgivable stupidity when it comes to doing thoughtless things that start such fires.
The folks at PG&E know all about that. The company is currently in the midst of a bankruptcy filing, in large part because of its equipment failures in Northern California over the past couple of years. San Francisco-based PG&E Corp. estimates $30 billion in liabilities from wildfires that have been blamed on its equipment, including the state's deadliest blaze which killed 85 people in late 2018.
PG&E’s plight — and that $30-billion nut to crack — is what compelled us to wonder if the governor’s $21-billion fund would ever be enough to compensate victims, especially if the monster-wildfire trend continues, or gets worse, which may easily be what will happen.
PG&E isn’t the only power company on the spot. The state's other two large utilities, Southern California Edison and San Diego Gas & Electric, have had their credit ratings downgraded over concerns about the wildfire potential.
The extraordinary costs of the damage caused by wildfires, and the expense of fighting them, are not likely to diminish. And the simple fact is, just about every person living in California is in the cross-hairs. Big fires can, and do occur just about everywhere there is forestation, dry brush and grasses, and the constant coming and going of people.
The important thing to keep in mind is that almost all of us depend on the electricity delivered by power companies, and in that sense we are all part of any effort to keep companies in operation. If the companies all sign on to Newsom’s plan, they would be paying about half the costs.
Regular readers are acutely aware that we write often about not being the absent-minded person who is responsible for starting a monster wildfire. To some, such editorial repetition may be tiresome. But for us, the importance of not being a fire starter is part safety, part financial. It seems obvious that California’s wildfire problems aren’t going to just disappear. If climate change continues — and it will — the fires will get bigger and more expensive.
Saving lives and saving money are big reasons why we issue frequent cautions about starting wildfires.