Cal Fire: PG&E violated state law in 8 wildfires last year
- Electric equipment owned by Pacific Gas & Electric caused 12 wildfires that killed 18 people and burned hundreds of square miles in California last October, the state's fire management agency said Friday.
- The utility violated state law governing vegetation management in eight of the wildfires, Cal Fire said in the release of its investigation, including blazes that killed 9 people. PG&E was also found at fault for four wildfires in a separate investigation released last month.
- PG&E's stock price was down more than 8% in premarket trading Monday. The utility has $800 million in liability insurance, but the Press Democrat reports insurance claims from the fires amount to $10 billion.
Besides presenting a constant threat to grid operations, wildfires also cast a pall over utility finances in California.
Analysts estimate PG&E could face up to a $12 billion liability for the 2017 wildfire season — much of it from the 12 wildfires Cal Fire addressed on Friday with the release of a new report. The utility's stock price has lagged behind its peers since the investigations were announced.
Each of the fires was caused by trees coming into contact with PG&E power lines or other equipment, CalFire said, and in eight of the cases the agency turned over its report to local prosecutors for "alleged violations of state law."
One fire referred to a district attorney was the Atlas Fire, which burned more than 51,000 acres and killed 6 people.
Another group of blazes — the Nuns, Norrbom, Adobe, Partrick & Pythian fires — killed 3 people and charred more than 56,000 acres. All but the Nuns fire were also referred to prosecutors.
In most cases, PG&E is not held accountable when falling trees or branches hit its system in an accident. But it can be found responsible if investigators determine that it did not do enough to clear vegetation from around its equipment, or if a device failure causes a blaze.
The utility on Friday said it is reviewing the findings and that officials "continue to believe our overall programs met our state’s high standards."
The company also reiterated calls to reform California fire liability laws. In March, Democratic Gov. Jerry Brown released a plan to update utility fire liability rules that could reduce PG&E's risk, but it remains pending in the state legislature.
PG&E said California is one of the only states where it can be found liable for fire damages, "even if we followed established inspection and safety rules."
"Liability regardless of negligence undermines the financial health of the state’s utilities, discourages investment in California," the utility said, "and has the potential to materially impact the ability of utilities to access the capital markets to fund utility operations and California’s bold clean energy vision."
Friday's Cal Fire report is unlikely to be the last headache for PG&E. The agency has yet to release its report on the Tubb's fire — the largest in the state last year — which killed 22 people.
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