California lawmakers have reached an initial agreement to shore up the state’s wildfire utility fund.
The agreement is expected be filed into legislative text on Wednesday after lawmakers suspended a Tuesday deadline, according to people familiar with the negotiations who asked not to be named because the information is private. The boost will be around $18 billion, according to the people.
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The agreement would see ratepayers contribute half of the money and utility shareholders contribute the other half, according to the people. The proposal is aimed at stabilizing utilities’ finances and limiting shareholder losses.
The move comes after January wildfires that devastated the Los Angeles area put the California Wildfire Fund at risk of being depleted. Potential liabilities from fires in the state have increased risks for utilities such as Edison International and PG&E Corp.
Related: US Government Says Southern California Edison Should Pay for LA Fire Costs
Established in 2019 after liabilities from the Camp Fire and other blazes sent PG&E into bankruptcy, the $21 billion fund currently has more than $13 billion in assets, according to the state. The state’s investor-owned utilities can pull from the fund to cover fire-related damages exceeding $1 billion.
Related: Viewpoint: Delay, Deny, Defend for California Wildfire Claims?
Top photo: A home burns during the Eaton Fire in Altadena on Jan. 8.
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