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March 24, 2022

The Governor of California
President pro Tempore of the Senate
Speaker of the Assembly
State Capitol
Sacramento, California 95814

Dear Governor and Legislative Leaders:

From 2013 through 2021, investor-owned utilities (utilities) in California initiated 67 public safety power shutoffs (power shutoffs), affecting more than 3.6 million customers. In addition, as of June 2021, utilities reported that nearly 40,000 miles of bare power lines exist in high fire-threat areas. Those bare lines contribute to the need to use power shutoffs as a last resort to prevent wild fires, but the work necessary to improve the bare lines will cost billions of dollars.

In light of the dramatic impact of wildfires and power shutoffs, and to assess two oversight entities’ roles in ensuring California’s safe and reliable electrical system, the Joint Legislative Audit Committee directed my office to conduct an audit of the California Public Utilities Commission (CPUC) and the Office of Energy Infrastructure Safety (Energy Safety Office). We determined that utilities are making improvements to the electrical grid that are necessary to reduce the risk of wildfires and prevent power shutoffs, but even if all of the improvements they completed in 2020 consisted of replacing bare power lines in high fire-threat areas with covered or underground lines, they would have addressed only 4 percent of such lines.

READ FULL REPORT: http://auditor.ca.gov/reports/2021-117/index.html#chapter1

As a result, the State must prioritize the areas utilities need to address first. A state law that took effect in January 2022 requires utilities to begin identifying sections of line that are regularly affected by power shutoffs and what they will do to reduce the need for and impact of future power shutoffs. The State could strengthen this law by requiring utilities to identify what is necessary to prevent future power shutoffs if the conditions leading to those shutoffs were to occur again, and to address a type of power outage caused by altering equipment settings that led to more than 600 unplanned power outages in 2021.

The Energy Safety Office’s process for approving utilities’ plans for mitigating the risk of wildfires does not ensure that the improvements are in high fire-threat areas. The office approved plans despite some utilities’ failure to demonstrate that they are appropriately prioritizing their mitigation activities, and subsequent reviews have found that some utilities failed to focus their efforts in high fire-threat areas. The CPUC also conducts audits to determine whether utilities comply with rules designed to ensure that they are operating safely, but it did not audit all utility service territories on a consistent basis, did not audit several areas that include high fire-threat areas, and has not used its authority to penalize utilities when its audits uncover violations.

Respectfully submitted,

MICHAEL S. TILDEN, CPA
Acting California State Auditor