Utility Admits Its Equipment Likely Started Deadly Camp Fire

SAN FRANCISCO (CN) – Pacific Gas and Electric warned investors Thursday that it expects to lose $10.5 billion after its power lines and equipment were identified as a probable cause of the 2018 Camp Fire, which destroyed thousands of homes and killed 85 people.

The announcement comes one day after the Wall Street Journal revealed PG&E delayed safety work on the Caribou-Palermo transmission line for at least five years. The location of that line was identified as a likely cause of the Camp Fire by the California Department of Forestry and Fire Protection, or Cal Fire.

PG&E detected a problem with its Caribou-Palermo line at about 6:15 a.m. on Nov. 8, 2018, the day the Camp Fire started. After the line was de-energized, a utility worker spotted a fire near the transmission line tower at around 6:30 a.m. and called 911, according to PG&E's Securities and Exchange Commission filing Thursday.

Later that day, an aerial patrol found "a suspension insulator supporting a transposition jumper had separated from an arm" on the tower. The company later found a broken C-hook attached to the insulator that had disconnected from the tower arm, according to its filing.

Additionally, the company reported finding damage to a pole and equipment for its "Big Bend 1101 12kV Circuit" in a location that Cal Fire also identified as a potential ignition point for the Camp Fire.

"Although the cause of the 2018 Camp Fire is still under investigation, based on the information currently known to the company and reported to the California Public Utilities Commission (CPUC) and other agencies, the company believes it is probable that its equipment will be determined to be an ignition point of the 2018 Camp Fire," PG&E stated in its filing.

The company also said it was recording another $1 billion charge related to the 2017 North Bay fires, on top of $2.5 billion previously reported. The $1 billion charge relates to the Atlas and Cascade fires, which charred a combined 61,600 acres and damaged or destroyed more than 1,000 buildings in Napa, Solano and Yuba counties in October 2017.

The additional $11.5 billion recorded Thursday brings PG&E's total wildfire-related liability charges to $14 billion. The company has previously acknowledged that its total wildfire liabilities could exceed $30 billion. That figure was cited as the primary driver behind the company's decision to declare bankruptcy in January.

In its filing Thursday, PG&E said it has completed more than two-thirds of its enhanced inspections for 5,500 miles of transmission lines and 50,000 transmission structures in high fire-risk areas. The company expects to finish the remaining inspections by the end of March. Additionally, PG&E said it would conduct enhanced inspections of 685,000 distribution poles across more than 25,000 miles of lines between February and May.

PG&E's interim CEO John Simon said Thursday the company recognizes more must be done to address the threat of wildfires in order to keep its customers and communities safe.

"We are taking action now on important safety and maintenance measures identified through our accelerated and enhanced safety inspections and will continue to keep our regulators, customers and investors informed of our efforts," Simon said in a statement.

PG&E's acknowledgement that its equipment may have caused the Camp Fire comes as state regulators and a federal judge are scrutinizing the company's $2.3 billion wildfire prevention plan.

U.S. District Judge William Alsup is considering imposing strict wildfire-prevention terms on PG&E as a condition of its probation in a criminal case related to the fatal 2010 San Bruno pipeline explosion.  Last week, PG&E told the judge it will take eight years to clear all hazardous trees, brush and overhanging limbs near its power lines that could spark a deadly wildfire in windy conditions.

The CPUC is expected to approve a final version of PG&E's wildfire prevention plan by the end of May.

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