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Q&A: Addressing California’s Wildfire Risk

California policymakers face the challenge of devastating fires.
By Robert Laffoon Villegas

Wildfire Mitigation Fact Sheet (Spanish)
'New Normal' Fact Sheet (Spanish)

Spanish

California policymakers are working to develop new policies to help strengthen standards that will reduce the risks associated with devastating wildfires that have become part of California’s “new normal” due to climate change and other conditions.

Courts have held California’s utilities liable for all of the property damage related to wildfires that involved utility equipment, without regard to whether the utility did anything wrong. This is known as inverse condemnation. The doctrine assumes that utilities can pass these costs on to their customers.

Since a California Public Utilities Commission decision last year on a wildfire in San Diego, it’s no longer clear if utilities will be able to share the risk of wildfire costs.

Pedro Pizarro, president and CEO of Edison International, discusses the need for comprehensive statewide solutions to address the increasing risk of wildfire and the infrastructure challenges faced by the state.

Q: Why do you see wildfires as such a big challenge to address?

A: As wildfires increase in frequency and intensity, it is imperative that thoughtful, comprehensive policies are crafted that help address this major threat affecting all Californians. This includes increased funding for wildfire suppression, improving our policies around forest management, land use management and building codes — particularly in high wildfire risk areas — hardening utility infrastructure in high fire risk areas, and, when unfortunate fires do occur, properly allocating responsibility for their consequences.

SCE is committed to being part of the discussions and solutions that will allow the state to change the way we all think about, plan and respond to wildfires. We must be nimble and acknowledge that the current structure is unsustainable and requires comprehensive solutions to mitigate risk, to protect citizens, customers and businesses, and to align public policy to current and future realities.

Q: How does this affect customers? Why should they care if they don’t live in a high fire risk area?

A: We all saw the awful footage of the wildfires last year. Eight of the 20 most destructive wildfires in California history have taken place in the last three years. And the risk is no longer seasonal — our “new normal” is that wildfires happen year-round. 

In terms of our customers, almost 30 percent of them live in high fire risk areas. There’s no denying anymore that dead, dying and diseased trees, as well as climate change and extreme heat, drought and heavy rains are affecting our very way of life. We can’t wait for another wildfire to attack this issue. We must come up with viable solutions, for the good of our collective safety and the economy.

Q: What are some specific solutions you believe are needed?

A: We must first work as a state to prevent and mitigate catastrophic wildfires. Second, our state infrastructure must be hardened with stronger building codes for infrastructure and other assets such as homes in high fire risk areas. Third, when a catastrophic event occurs in spite of all of these efforts, we need thoughtful policies around how financial risks are allocated, including fire suppression costs and responsibility for damages.

We believe that the state should establish objective wildfire mitigation operating standards that meet or exceed industry best practices and are applicable to California's utilities and other critical infrastructure providers.

If something goes wrong, regulators should use these clear standards when they determine if a utility properly ran its system. An updated standard of liability that considers degree of fault rather than the current standard of strict liability would ensure that there is a fair sharing of the increasing risk of climate change impacts across society.

Q: There has been legislation already introduced regarding wildfire issues. Are you supportive of those efforts?

A: We will continue to work with state leaders — lawmakers and business and community leaders — on a comprehensive wildfire solution that addresses the issues of prevention, liability and cost recovery. This could be through existing bills or new legislative vehicles as they come up.

We were heartened by the statement released by Gov. Brown's office in conjunction with bipartisan legislative leaders. They are partnering on solutions that will make California more resilient against the impacts of natural disasters and climate change. The statement noted five key areas that they and the Joint Legislative Committee on Emergency Management will focus on to craft solutions, from updating liability rules and regulations for utilities to enhancing prevention and mitigation efforts surrounding these events.

At this stage in the legislative process, the individual bill numbers matter less than the substance. And we are fully engaged with the legislature on these issues, with a goal of achieving reforms that provide more transparency and additional efforts to mitigate catastrophic events.

At this point, though, it's just too early to comment on any one bill or what the vehicle would be that could end up getting amendments that could address the liability issue.

Q: What do you see as the timeline for addressing these issues?

A: There is continuing dialogue with the utilities and Sacramento policymakers. The Senate, the Assembly and the Governor's Office are talking with a lot of different parties. There are many parties at the table, including labor and environmental groups, government agencies or experts in fires and forest management, as well as other industries such as insurance, construction and building. We certainly want to see that big picture, statewide view. I can't predict any specific timeline or outcome, but we are very encouraged that Sacramento is so engaged at this stage of the process.

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