California Utility Customers Could Get Stuck with a Big Bill for the Eaton Fire

Source: Los Angeles Times  |  By Melody Peterson

One early estimate places fire losses from the Eaton fire at $24 billion to $45 billion. If Southern California Edison equipment is found to have sparked the blaze on Jan. 7, as dozens of lawsuits allege, the damage claims could quickly exhaust the state’s $21-billion wildfire fund. This year, the electric bill surcharge is expected to add $923 million to the fund, according to California Public Utility Commission records. If the fee were extended an additional 10 years, it would require customers of the three utilities to pay an additional $9 billion into the fund. That doesn’t sit well with consumer advocates, who point out customers are already on the hook to contribute half of the $21-billion fund, while also paying higher bills to cover costs such as undergrounding and insulated electric wires.

“We think ratepayers have more than done enough,” said Mark Toney, the executive director of The Utility Reform Network, also known as TURN, a consumer group in San Francisco. “My position is that ratepayers should not pay another penny.” Among the consultants is Guggenheim Securities, the investment banking arm of Guggenheim Partners. Another subsidiary of Guggenheim Partners owns stock in the state’s three big utilities. A recommendation to tap utility customers to replenish the fund, instead of the utility companies themselves, would likely have a big impact on company share prices.  “They [Guggenheim] certainly have a vested interest in the financial success of the utilities,” Toney said.