Gov. Gavin Newsom is preparing a draft legislation that will add an additional $18 billion to state funds for wildfire victims, and officials warn that the deadly Eaton Wildfire in January could run out.
Clients of the state’s three largest for-profit utilities will pay an additional $9 billion to supplement the state fund created in 2019, which holds $21 billion, according to Newsom’s plan.
According to the draft proposal, the other $9 billion will come from shareholders in Southern California, Pacific Gas & Electric and San Diego Gas & Electric.
“We will continue to develop policies with the Legislature that will stabilize California’s wildfire fund to support the recovery of wildfire survivors and protect California utility consumers, even if wildfires become bigger and more destructive due to climate change,” Newsom’s office said in a statement Thursday.
Clients of the three utilities have contributed half of the initial $21 billion fund in the surcharge on their monthly bills of about $3. The proposal will allow customers to pay $9 billion more after 10 years after 2035.
“We are disappointed to talk about more taxpayer funds going to the Wildfire Fund,” said Mark Toney, executive director of consumer advocacy group The Utility Reform Network.
Utilities executives also criticized the plan reported earlier by Bloomberg, which proposed that its shareholders pay additional amounts to the fund.
Edison International CEO Pedro Pizarro told Wall Street analysts on a conference call that the company had told Newsom and lawmakers that any legislation promoting the fund “will not have shareholder donations.”
“We’re going to need to see the balance of the ultimate package,” Pizarro said.
Newsom’s plan has been circulating with legislative leaders and others, requiring approval of the state Senate and parliament. According to the draft proposal, the $18 billion will become a new “continuing wildfire fund.” The new fund will not be created until the administrator of the state’s original wildfire fund determines that additional funds are needed.
Newsom and lawmakers created the $21 billion fund in 2019 to protect utilities from bankruptcy and to create devastating fires.
Tony said state officials told him at the time that the fund had a 99% chance of lasting for 20 years. Now, it can be wiped out by a fire.
He said he believes the liabilities the fund will pay needs to be limited. “We can’t go back every three to four years and put in more money,” he said.
Tony said electric customers have also paid $27 billion for tree pruning and other work designed to prevent wildfires, which is rapidly driving electricity bills, since the fund was created.
Despite the money spent, Edison equipment from 2023 from 90 to 2024.
Investigations into the Eaton fire continue, which killed 19 people and destroyed thousands of homes and businesses in Altardner. The video captured the fire under the Edison Transmission Tower on January 7.
Pizarro said a major theory is that the dormant Edison transmission line, which has not been used since 1971, has become electrical in some way and triggered a fire.
Property losses based on insurance may be as high as $15.2 billion. estimate Posted by state officials last week. This amount does not include uninsured losses or damages other than the property, such as a claim for illegal death. A UCLA study estimated losses of $24 billion to $45 billion.
