California lawmakers are a step closer to an agreement on who should be held responsible when a utility causes a wildfire, after the Governor, Senate and Assembly leaders reached a compromise reflected in Senate Bill 492.
According to the California Public Utilities Commission, utilities have caused roughly half of the state’s most destructive wildfires.
Debate over who should pay for damages from those fires has continued for years.
State Sen. Josh Becker said Senate Bill 492 is intended to increase accountability for utility executives.
“We’ve done a lot in this state, and utilities are investing actually a lot of money for prevention.”
“But we need to make sure the CEOs themselves feel the pain if their equipment causes a fire,” Becker added.
Under the bill, executives of utility companies that start a large fire would be ineligible to receive a bonus.
MORE: Consumer advocates push back on PG&E spending requests as utility bill frustrations boil over
The Utility Reform Network, a consumer advocacy group, said it supports the measure.
“We need a way to basically penalize the utility executives for starting wildfires. And that’s never happened before,” said Lee Trotman with The Utility Reform Network.
The organization said it supports the bill in its entirety, arguing that it protects ratepayers while prioritizing wildfire survivors through a faster payout process.
“There’s no way you can compensate someone for the loss of life, right? Their families, etc.. but you make it financially painful. You make sure that the utility executives have skin in the game,” Trotman said.
MORE: PG&E asking state regulators to raise gas rates, approve $26M shareholder payment
Investor concerns also emerged following the announcement, as stocks of major California utility companies declined.
PG&E said in a statement that “the bill does not adequately address the financing risks created by California’s current wildfire liability framework.”
Newsom had originally sought to include provisions limiting the ability of insurance companies to recover money from utilities after a wildfire. That proposal was not included in the final compromise.
In a statement, the governor wrote, “This is all real progress for future fire survivors. Nonetheless, this system needs full structural reform – not a partial one.”
Becker said the legislation is focused on wildfire victims and survivors while increasing executive accountability.
“This was really focused on survivors and victims and, and making sure the hedge fund still won’t profit in this process and that utility CEOs are accountable,” Becker said. The bill is expected to be voted on Tuesday morning.
If you’re on the ABC7 News app, click here to watch live
