Pacific Gas & Electric (PG&E), one of the largest utilities in the U.S. and responsible for equipment-related wildfires, aims to bury power lines in high-risk areas to avert catastrophic blazes like the 2018 Paradise fire. However, state regulators are opposing this plan due to its lengthy timeline and substantial $5.9 billion price tag, which would be shouldered by PG&E’s customers.
Regulators favor a cheaper, albeit riskier, approach of covering overhead power lines with protective measures instead of burying them. PG&E contends that burying power lines reduces the chance of igniting wildfires by 99%, as they cannot be toppled by wind storms. Conversely, the protective cover, which insulates power lines if they fall, reduces the wildfire risk by 62%.
PG&E’s CEO, Patti Poppe, argues that living with a 35% risk is unacceptable and compares it to boarding a plane with a 35% chance of crashing.
The utility filed its plan with state regulators, the California Public Utilities Commission, last year. A decision on the issue is expected next month, with PG&E presenting its case before the commission.
The utility’s proposal is unprecedented in both scale and pace, intending to bury 2,000 miles of power lines and working toward an even more ambitious goal of burying 10,000 miles over the next decade. The outcome of this case has implications beyond California, as utilities nationwide grapple with the trade-offs between the cost of burying power lines and the risk of wildfire damage.
While overhead power lines are more prevalent due to cost-effectiveness, utilities are increasingly considering burying lines in response to the heightened risk posed by natural disasters. In Florida, for example, around 45% of Florida Power and Light’s distribution system is underground.
California’s other major utilities are also working on burying power lines. Southern California Edison plans to bury 600 miles of power lines by 2028, and San Diego Gas & Electric has already buried 145 miles and aims to bury an additional 1,500 miles by 2031.
However, the outcome of this issue extends beyond power line safety and can affect electricity rates and insurance. Over the past year, seven of California’s top 12 insurance companies have restricted new business in the state due to wildfire risk.
The rate increase tied to PG&E’s proposed plan, which includes additional projects besides burying power lines, could result in an average rise of nearly 18% or $38.73 per month for customers. PG&E’s residential rates have already more than doubled since 2006, with low-income customers facing a 170% increase over the same period. Burying power lines is the most effective way to prevent wildfires, but it’s a time-consuming process due to planning, permits, and excavation requirements.
Although PG&E has improved protection for 14% of its system in high-risk wildfire areas by the end of 2022 and claims more miles of distribution lines in these zones than Southern California Edison, critics remain skeptical of the utility’s commitment to safety.
The final decision by the California Public Utilities Commission will be closely watched, as it will determine the future approach to wildfire prevention in the state and could serve as a precedent for utilities nationwide.