Tackling California's wildfire recovery costs could cost as much as $50 billion under this plan
- Jun 19, 2019 12:21 pm GMT
Jun. 18--Heading into a private meeting with Gov. Gavin Newsom and his staff on Wednesday, California lawmakers are floating an expensive plan to address wildfire liability costs and settle victims' claims.
During a panel discussion at the Sacramento Press Club on Tuesday, state Sen. Bill Dodd, D-Napa, teased a proposal that would create a catastrophic wildfire fund of up to $50 billion.
He said utility companies would provide most, if not all, of the money for the fund, costing "anywhere between $24 billion and $50 billion."
"It's important that we put together a program where ratepayers aren't the victims once again," Dodd added.
In an interview after the event, Dodd said the total amount of money for the fund should be no less than $25 billion to $30 billion. Without sufficient funding, he worries ratings agencies would follow through on their promise to downgrade two California-based utility companies, which could lead to higher monthly utility bills for customers.
"That's probably the range of practicability. ... $50 billion is going to be hard to do even if we need that," Dodd said.
He noted PG&E would likely bear the greatest share of the cost, followed by Southern California Edison and San Diego Gas & Electric.
"That's kind of the pecking order on who's done the best job or the worst job," Dodd said. "PG&E has no doubt done the worst job. San Diego Gas & Electric has no doubt done the best job."
Dodd confirmed he'll attend a private meeting with Newsom and other key Democrats to discuss the plan Wednesday afternoon. They will also evaluate creating a proposed "liquidity fund" of at least $10 billion for investor-owned utilities.
Under that model, ratepayers would have a few extra dollars added to their utility bills each month. That money would then go into the liquidity fund, where it could be lent to utilities to pay claims from wildfire victims.
During the panel discussion on Tuesday, Michael Picker, president of the California Public Utilities Commission, framed the problem most bluntly. "We've got a big f--king fire problem in California. Let's start the narrative there."
Brian Ferguson, a spokesman for Newsom, told The Sacramento Bee in a statement last week that Newsom "has made expanding the state's wildfire prevention, safety and mitigation capacity a top priority" and that "the administration is committed to working expeditiously to forge a path toward a safe, reliable and affordable clean energy future."
Newsom has yet to release a comprehensive plan directing lawmakers how to act on wildfires, though he has signaled his desire to "get something big done" before state lawmakers leave the Capitol on July 12 for a month-long recess.
In a joint statement last month, Newsom, Senate leader Toni Atkins and Assembly Speaker Anthony Rendon expressed their intent to hold off on a plan that would shift the risk of property loss away from utilities and toward insurance companies and homeowners who are either under-insured or without insurance.
"We're not going to go down that road this year or next year," Dodd said at the event.
Dodd is confident something will get done by July 12 but doubts a formal policy proposal from Newsom will come out this week, given that there will be more discussions behind the scenes in the coming days.
"We haven't even met with the governor, and we don't want to get out in front of the administration," Dodd said in the interview. "They have some great ideas that I'm looking forward to hearing about it. The governor's been very, very engaged, and I look forward to his willingness to bring us in to discuss where they are today and to hopefully seek some counsel from some of us that spent a lot of time in this area."
(c)2019 The Sacramento Bee (Sacramento, Calif.)
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