California’s Governor: Insurance Fared Better in Wildfires Bill

By | September 17, 2018

California lawmakers didn’t go as far as Governor Jerry Brown wanted to address potential liabilities for utilities from wildfires, and the governor said that “it’s hard to say” if they ever would.

Brown, citing longstanding practice, declined to say if he would sign the bill passed last month that included measures considered beneficial for utilities such as PG&E Corp. But the wide-ranging plan didn’t tackle the issue of inverse condemnation, in which utilities can be held liable for costs if their equipment is found to have caused a fire — regardless of whether they followed safety rules. Brown had pushed a proposal that would have given utilities relief from the rule, which was opposed by insurance companies, trial lawyers and fire victims.

“The insurance companies and the trial lawyers are very powerful. This time they did better than the electric utilities,” Brown said in an interview in San Francisco at the Global Climate Summit. “Better in the sense that they got what they wanted and the utilities got a lot of what they wanted but not everything.”

The bill was still a key victory for PG&E, which may owe as much as $17.3 billion for the blazes that ravaged the state in 2017 alone. The utility owner raised the prospect of bankruptcy as it lobbied lawmakers for help and has lost more than $11 billion in market value in the past year.


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