January 5, 2019 | Ivan Penn | The New York Times
Facing billions of dollars in damages, PG&E and other utilities want legislators to let them pass on the cost to homeowners through higher electricity rates.
LOS ANGELES — As California’s deadliest wildfire was consuming the town of Paradise in November, some of the state’s top power company officials and a dozen legislators were at an annual retreat at the Fairmont Kea Lani resort on Maui. In the course of four days, they discussed wildfires — and how much responsibility the utilities deserve for the devastation, if any.
It is an issue of increasing urgency as more fires are traced to equipment owned by California’s investor-owned utilities. The largest, Pacific Gas and Electric, could ultimately have to pay homeowners and others an estimated $30 billion for causing fires over the last two years. The most devastating of those, the Camp Fire, destroyed thousands of homes in Paradise and killed at least 86 people.
Realizing that their potential fire liability is large enough to bankrupt them, the utility companies are spending tens of millions of dollars on lobbying and campaign contributions. Their goal: a California law that would allow them to pass on the cost of wildfires to their customers in the form of higher electricity rates. After an earlier lobbying push, legislators have already voted to protect the companies from having to bear the cost of 2017 fires, and utilities are seeking the same for 2018.
The utility companies acknowledge that they may bear some responsibility but say not all of it, because climate change and development in remote areas have made wildfires more destructive. In addition, they argue that electricity rates would go up regardless of whether the state protected them because investors and banks could grow wary of lending to California’s energy sector.
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The companies waged a multimillion-dollar campaign to secure that protection. In the first nine months of 2018, the three investor-owned utilities collectively gave $5 million to the campaigns of state lawmakers, as much as $1 million more than they had in any full year since 2011, according to Consumer Watchdog, an advocacy organization in California.
PG&E stepped up its lobbying effort, too — spending $8.4 million in just the first nine months of 2018, compared with $1.6 million in all of 2017 and $1.1 million in 2016. The company’s spending in the first three quarters exceeded 2017’s top spender, Chevron, which spent $8.2 million that year, according to Consumer Watchdog.
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A version of this article appears in print on Jan. 6, 2019, on Page B1 of the New York edition with the headline: Passing the Buck as Fires Raged.