{"id":216310,"date":"2026-09-05T14:37:15","date_gmt":"2026-09-05T14:37:15","guid":{"rendered":"https:\/\/www.europesays.com\/people\/216310\/"},"modified":"2026-09-05T14:37:15","modified_gmt":"2026-09-05T14:37:15","slug":"how-californias-climate-obsession-is-fueling-the-utility-crisis-orange-county-register","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/people\/216310\/","title":{"rendered":"How California\u2019s climate obsession is fueling the utility crisis \u2013 Orange County Register"},"content":{"rendered":"

As fierce negotiations over a last-minute wildfire liability bill dragged on last week, the CEOs of Pacific Gas & Electric and Edison International sent a two-page letter<\/a> to the California Legislature warning that Senate Bill 492 threatened the state\u2019s clean energy goals.<\/p>\n

The letter also called out the bill for failing to deliver \u201cadequate compensation for wildfire victims\u201d and doing nothing about \u201cthe contingency fees that have historically consumed 25 to 40 percent of recoveries.\u201d<\/p>\n

But here\u2019s one sentence in the letter that may surprise you: \u201cCustomers currently pay millions of dollars annually to attract the investment necessary to meet California\u2019s climate goals.\u201d<\/p>\n

That means the utilities are borrowing money in the bond market to build green energy infrastructure to meet the targets that the brain trusts in Sacramento mindlessly mandated in state law.<\/p>\n

For example, the state wants the utilities to pay for electric vehicle charging infrastructure, as well as transmission lines between the cities that use electricity and the remote locations where lawmakers expect wind and solar energy facilities to generate it.<\/p>\n

\u201cIncreased costs of borrowing, driven by bondholder reactions or credit agency actions, will only exacerbate the affordability crisis for customers,\u201d the CEOs wrote.<\/p>\n

They\u2019re saying the utilities need a liability shield, or they will have to pay higher interest rates to borrow money, with the cost passed on to ratepayers. Financial liability for wildfires affects the companies\u2019 credit ratings, which affects the cost of borrowing and may raise the cost of operating in other ways. Sometimes favorable terms in contracts with suppliers are contingent on maintaining a high credit rating.<\/p>\n

So if you wanted to know what leverage the utilities have over the governor, you don\u2019t have to look much further. Gavin Newsom is politically invested in the costly delusion that California is a world leader on climate policy, first among nation-states to advance \u201cthe transition\u201d to an all-electric future powered by solar and wind energy. Newsom needs the investor-owned utilities to invest whatever it takes to build the infrastructure that accommodates the state\u2019s uniquely aggressive climate agenda.<\/p>\n

If there was genuine value in the technology he\u2019s pushing, investors would be climbing over each other to buy into it. That\u2019s not the case. What we have instead is the government, through mandates and subsidies, trying to force the \u201ctransition\u201d into existence.<\/p>\n

Newsom wanted to sign a wildfire liability bill that blocked the ability of insurance companies to recover their payouts to policyholders by seeking reimbursement from the utilities held liable for the fire damage. Insurers said that would have severe consequences, destabilizing the state\u2019s insurance market. On Tuesday, the Legislature adjourned without passing the bill the governor had advocated.<\/p>\n

On Wednesday, PG&E CEO Patti Poppe announced that the company will reduce its planned investments for 2027 by 15%, including a deferral of $2 billion that was to be invested in connections to new renewable energy projects and housing developments. Poppe told<\/a> the San Francisco Chronicle that the company must borrow less money. Otherwise the higher borrowing costs will hit ratepayers.<\/p>\n

Understand this down to your bones: California\u2019s climate goals make everything in the state more expensive.<\/p>\n

It may appear that the state government is \u201cin the tank\u201d for PG&E and other investor-owned utilities, but what\u2019s actually happening is an elaborate all-of-government effort to keep the utilities solvent enough so investors will buy their bonds and finance California\u2019s economically unsound desire to power the state with sunshine and breezes.<\/p>\n

If the utilities are financially damaged by wildfire liability, their credit rating goes down, the interest\u00a0 rates they have to pay to borrow money go up, and the costs get passed through to utility customers in higher electricity rates.\u00a0<\/p>\n

Of course, shielding the utilities from the insurance companies causes insurance premiums to go up, if policies are available at all. That harms consumers and does grave damage to businesses throughout the economy.<\/p>\n

The only way to shield both the utilities and the insurance companies is to put taxpayers on the hook to pay liability claims. But nobody\u2019s going to get elected to anything by doing that.<\/p>\n

Will utility investors pay? They are not obligated to stick around and get stuck, over and over again. You can see them heading for the exits in falling stock prices and rising borrowing costs.\u00a0\u00a0<\/p>\n

Here\u2019s the question that holds the key to solving the wildfire liability problem: Why is the liability from California wildfires so record-breakingly, ruinously enormous?<\/p>\n

One reason is that California, alone among the 50 states, holds investor-owned utilities \u201cstrictly liable\u201d for all the damage from a fire that is started by their equipment, meaning they are liable even if they were not negligent. The doctrine known as \u201cinverse condemnation\u201d combined with \u201cstrict liability\u201d means the only limit on a utility\u2019s financial losses from a wildfire is bankruptcy.<\/p>\n

The rest of the story is the change to California land management policies in relation to wildfire mitigation. At one time, it was routine to use heavy equipment and prescribed burns to create fire breaks that would limit the spread of wildfires and contain the damage from them.<\/p>\n

The California Air Resources Board issued \u201csmoke regulations\u201d in 2000 that sharply curtailed the use of prescribed burns, and state officials prohibited the use of heavy equipment that might damage protected plants.<\/p>\n

The Los Angeles Department of Water and Power was fined<\/a> $1.9 million by the Coastal Commission in 2019 for damaging 183 Braunton\u2019s milkvetch plants while replacing old wooden power poles in Topanga State Park to protect Pacific Palisades from fire risk. The Braunton\u2019s milkvetch is endangered. Don\u2019t ask what happened to the Palisades.<\/p>\n

Californians have to be adults about this. The state needs affordable electricity, a functioning insurance market and fair compensation for fire victims. We won\u2019t have any of that if we don\u2019t stop pretending that we\u2019re protecting the earth with our idiotic policies.<\/p>\n

One way to limit the liability for wildfires is to limit the damage from wildfires. This is something the state did routinely just a couple of decades ago. Let\u2019s start there.<\/p>\n

Write Susan@SusanShelley and follow her on X @Susan_Shelley<\/p>\n","protected":false},"excerpt":{"rendered":"As fierce negotiations over a last-minute wildfire liability bill dragged on last week, the CEOs of Pacific Gas…\n","protected":false},"author":2,"featured_media":216311,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[147],"tags":[542,55,3867],"class_list":["post-216310","post","type-post","status-publish","format-standard","has-post-thumbnail","category-gavin-newsom","tag-gavin-newsom","tag-opinion","tag-opinion-columnists"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@people\/117218944164839161","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/posts\/216310","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/comments?post=216310"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/posts\/216310\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/media\/216311"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/media?parent=216310"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/categories?post=216310"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/people\/wp-json\/wp\/v2\/tags?post=216310"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}