Inadequate wildfire mitigation efforts by public utilities have put residents and shareholders at risk, according to an investigation by CNBC. The article highlights the failures of utility companies to properly assess the risks wildfires pose to their operations and the lack of state oversight. It presents two case studies – the Paradise, California wildfires in 2018 and the Lahaina, Hawaii wildfires in 2023 – to illustrate the consequences of these shortcomings.
The Paradise blaze, which burned for two weeks, resulted in the displacement of tens of thousands of residents and the loss of 84 lives. Utility giant PG&E later pleaded guilty to involuntary manslaughter and unlawfully starting a fire. The company settled a $13.5 billion lawsuit and filed for bankruptcy before emerging in 2020. However, fire victims are still waiting for relief, with less than 60% of their claims paid out.
The Lahaina wildfires in Hawaii were the most destructive and deadly human-made disaster in the state’s history. The fires burned over 3,000 acres and caused an estimated $5.5 billion in damage. The cause of the fires is yet to be determined, but the county has filed a lawsuit against utility company Hawaiian Electric, alleging inadequate infrastructure maintenance. Hawaiian Electric’s wildfire mitigation plan did not include power shut-off strategies, citing customer dissatisfaction with similar measures implemented by PG&E in California.
The article also highlights the role of profit protection in the failure to assess and mitigate wildfire risks. Utility companies prioritize building new infrastructure to generate revenue, rather than investing in measures such as burying power lines or clearing vegetation around their infrastructure. Additionally, utilities often rely on regulators who can help maintain favorable policies, leveraging their financial contributions to political campaigns.
State oversight is another key issue identified in the article. Several states do not track utility-caused wildfire data, and public utility commissions, responsible for enforcing safety rules and overseeing rates, often lack information on utility-caused fires. The lack of oversight raises concerns about the safety of electric utilities’ infrastructure and the need for stronger regulation.
The article concludes by highlighting the legal implications faced by utility companies involved in wildfires. Lawsuits from fire victims and investors can result in significant financial settlements. However, these settlements may come with conditions, such as victims waiving their right to sue the responsible parties.
Overall, the article sheds light on the inadequate wildfire mitigation efforts of public utilities, emphasizing the risks posed to residents and shareholders. It highlights the need for stronger state oversight, improved wildfire mitigation strategies, and increased accountability for utility companies to ensure the safety of communities and protect shareholder interests.
