Matthew Wibbenmeyer: PG&E Power Outages Reduce Just a Portion of Wildfire Risk

Oct. 11, 2019 – Wibbenmeyer is an expert on the management and economics of wildfires and forest resources.

This week, a severe off-shore wind event—similar to wind events that drove several of California’s recent devastating wildfire incidents—hit California. In response, Pacific Gas & Electric (PG&E), California’s largest electricity utility, shut down power this week to more than 500,000 people. The power shutdown will reduce the wildfire risk PG&E faces, but it will not eliminate wildfire risk during wind events, and it will come at a cost to residents.

Advertisement

The areas affected by the power outages stretch across 34 of California’s 58 counties, from the Bay Area to the Sierras, wine country and the northern coast. Outages began Wednesday morning, and PG&E warned that in some places, outages could last as many as five days, though by Friday, service had been restored in some areas. Meanwhile, as of Tuesday, Southern California Edison (SCE), which serves much of southern California, was considering cutting power to more than 100,000 customers within its own service area.

PG&E’s decision is driven by concern over limiting its liability for wildfire risk. PG&E has been found responsible for igniting many of California’s deadliest and most destructive fires in recent years, including the 2018 Camp Fire, which killed 86 civilians, destroyed more than 18,000 buildings, and caused more than $12 billion in insured losses. Under California law, PG&E is liable for damages from fires caused by their equipment due to improper management. Last year, facing heavy liabilities from the Camp Fire, PG&E declared bankruptcy. While the utility negotiates bankruptcy, it faces a maintenance backlog that exposes the company—and much of California—to fire risk during wind events like the one this week.

While planned power outages limit the exposure of utility companies to fire risk, the outages guarantee substantial costs to residents and businesses. Forced to shut down, businesses can lose substantial revenue. Power losses over several days can lead to spoiled food in household refrigerators and in grocery stores. Especially affected are vulnerable people like the elderly, who may rely on electricity to power medical devices. According to estimates by Michael Wara, a Stanford expert on climate, energy, and wildfire policy, outages this week could result in $2.5 billion in damages, with most of those damages accruing to local businesses.

Meanwhile, even though planned power outages remove a particularly hazardous source of ignitions, other ignition sources remain. Five percent of California wildfire ignitions are caused by power lines. Though wildfires caused by power lines tend to be more destructive—since the windy conditions that cause power line ignitions drive larger fires—only 11 percent of area burned in California wildfires results from power line ignitions. The Carr Fire, a large and destructive wildfire in northern California in August 2018, was ignited by sparks from a vehicle. The Tubbs Fire, which destroyed over 5,000 structures in northern California, was found to result from a private electrical system adjacent to a residential structure. Planned power outages may even lead to new sources of fire hazard, if households and businesses install gas-powered generators in anticipation of future shutoffs.

Wildfire disasters are caused by a diverse set of factors. Climate change and historical forest management have created landscapes and weather patterns that are conducive to more frequent and severe fires. Residential development in high-fire-risk areas often results in greater loss when fires do occur.

Planned power outages reduce the potential for utilities to face wildfire-related liabilities, but these measures come at great cost to consumers. To the extent that planned power outages result in fewer wildfire disasters, they may be worthwhile. However, outages remove just one of many sources of ignition, and conditions in California ensure that wildfire disasters will continue.

The causes of wildfire disasters encompass more than just ignitions. To begin to reduce losses from wildfires, California needs to address some of these other underlying causes, as well.

Full disclosure: One of the utilities mentioned in this article, PG&E, is an RFF funder. The views expressed here are those of the individual authors and may differ from those of other RFF experts, its officers, its directors, or the institutions that support RFF. PG&E was not consulted in the writing of this article.

Resources for the Future (RFF) is an independent, nonprofit research institution in Washington, DC. Its mission is to improve environmental, energy, and natural resource decisions through impartial economic research and policy engagement. RFF is committed to being the most widely trusted source of research insights and policy solutions leading to a healthy environment and a thriving economy. www.rff.org