The nation’s largest utility group is proposing a new federal wildfire fund that would reimburse power companies for the mounting costs of legal claims in the wake of a disaster.
The initiative, still in its early stages, has gained more urgency following the devastating Palisades and Eaton fires in Los Angeles that broke out in early January. At least 28 people died, more than 16,000 buildings were destroyed, and damage claims could range from $95 billion to $164 billion, according to an analysis by the University of California at Los Angeles.
The Edison Electric Institute (EEI), representing major investor-owned utilities, is advancing the proposal, warning that open-ended legal judgments for wildfire damage caused by power equipment will hobble investment, just as needs escalate for more electricity generation and grid upgrades.
“The financing challenges created by utility wildfire risk are occurring at a time when utilities need to invest more in new infrastructure than they have in the living memory of most people managing them or regulating them,” Michael Wara, a Stanford University professor and wildfire expert who is advising EEI.
