Facing $17 Billion in Fire Damages, Utility Company Blames Climate Change For Wildfires

Authorities don’t yet know the cause of some of the fires, but the region’s giant utility, PG&E Corp., sees a culprit at work — climate change.

The blazes in recent years, it said, are the latest example of how global warming has produced unusually hot, dry conditions that spawn more frequent and intense fires.

“Climate change is no longer coming, it’s here,” Geisha Williams, the chief executive officer of PG&E, said in an email. “And we are living with it every day.”

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Invoking the environment is a clever strategy in a state that’s taken on the green mantle in the face of a skeptical Trump administration. (Indeed, President Donald Trump offered his own reason for the fires last week, blaming a lack of water and bad environmental laws. It was roundly dismissed.)

Williams’s battle cry — don’t blame us, blame climate change — is catching on. PG&E’s neighboring utilities, Edison International and Sempra Energy, are echoing the defense, and it may well serve as a blueprint for utilities worldwide as global warming produces extreme weather events such as hurricanes that have slammed Texas and Puerto Rico.

Williams is deploying the argument in a lobbying campaign she’s waging to shield PG&E from liability. California law holds that property owners can collect compensation from utilities linked to fires — even if they weren’t negligent.

She argues that because of the increasing frequency of fires, utilities shouldn’t be held responsible each time a tree branch falls on a power line during a storm if it followed all safety rules.

Instead, the test should be whether the utility acted “reasonably” in trying to prevent fires, things like trimming trees and brush around lines, she contends. In that case, insurance or government agencies would pick up the damages.

“No one is suggesting the utilities should get a free pass if they were negligent,” Williams said. But the current legal policy of unlimited, strict-liability has the potential to financially cripple companies, she said.

Some California lawmakers insist PG&E hasn’t even met the reasonable standard, pointing to signs that in some cases PG&E allegedly violated fire safety rules, according to reports by the California Department of Forestry and Fire Protection, or Cal Fire.

“Climate change and the so-called new normal do not ignite fires,” said California State Senator Jerry Hill, a frequent PG&E critic. “The Cal Fire findings show that suspected negligence by PG&E did.”

PG&E says it believes it has met the state’s high safety standards. The utility hasn’t been blamed for any of this year’s fires, but it’s got plenty of financial worries dealing with the ones from 2017.

On a recent investor call, Williams raised the stakes by saying PG&E has brought up the prospect of bankruptcy with lawmakers unless the state changes the law.

It’s already taken a $2.5 billion charge stemming from the October fires.

PG&E has shown that it won’t shy away from court protection. It entered bankruptcy in 2001 after incurring $9 billion in debt by buying power for more than it could charge customers. It emerged from it three years later.

Read rest at Bloomberg