PG&E May Raise Rates to Cover Cost of Wildfires

The utility has a bad record when it comes to fire safety.

Pacific Gas & Electric has a bad record when it comes to fire safety. According to Congressman Mike Thompson, the utility’s Fire Victims Trust has paid out $5.36 billion in settlements to survivors of the 2015 Butte, 2017 North Bay, and 2018 Camp Fires. And as more wildfire costs pile up for PG&E, it could be looking to pass them along to customers.

According to the Mercury News, PG&E has asked the Public Utilities Commission to let it raise rates for its customers so it can recoup $1.36 billion it has shelled out to deal with catastrophes it caused. As the report points out, PG&E equipment has sparked many deadly wildfires in Northern California. The utility also caused a gas explosion that killed eight people in San Bruno in 2010.

If the PUC allows PG&E to raise its rates, customers on average would end up paying an extra $8.67 per month to help the utility cover its costs.

PG&E said it has made several important safety improvements since the 2018 Camp Fire, which caused 85 deaths and destroyed more than 18,000 buildings. The company said it has ramped up inspections, installed more weather stations and cameras, hardened hundreds of miles of electric lines, and increased diligence toward clearing dry vegetation.

According to the Wall Street Journal, PG&E’s ambitious plans to mitigate the risk of wildfires caused by its equipment could cost tens of billions of dollars, and the utility doesn’t have a clear idea of where that money will come from. In 2020, PG&E emerged from Chapter 11 bankruptcy after restructuring. But that process has left it with limited options for raising debt and equity.

So it appears for now that the same customers who stand to lose the most from wildfires could be stuck helping pay to solve the problem.

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