California utilities not doing enough to reduce wildfire threats, auditor says

California utilities aren’t doing enough to prevent wildfires, according to the state auditor. 

In a report to the California Legislature, the State Auditor’s Office said that regulators had approved "[seriously] deficient" plans, including from the Pacific Gas and Electric (PG&E). 

"The Energy Safety Office issued the 2020 safety certifications to the three largest utilities, even though it identified serious deficiencies in each of their mitigation plans. Although for 2021 the Energy Safety Office no longer approved mitigation plans without the utility first addressing critical issues, we question the appropriateness of the process it followed to approve mitigation plans and issue the 2020 safety certifications," it wrote. 

Moreover, the auditor said that the Energy Safety Office’s mitigation plan approval process and the California Public Utilities Commission's (CPUC) audit process do not hold utilities sufficiently accountable. 

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"The Energy Safety Office approved utilities’ mitigation plans despite some utilities’ failure to demonstrate that they are appropriately prioritizing their mitigation activities. As referenced earlier, utilities reported that their hardening projects had addressed relatively few miles of bare power lines in high fire-threat areas during 2020. However, we found that the Energy Safety Office approved mitigation plans that did not provide adequate information on how utilities prioritized those projects," the report reads. 

The auditor said that the office had conditionally approved PG&E's 2020 mitigation plan even though it found the utility had not described where vegetation management was most necessary, also noting that the Energy Safety Office guidelines do not require that the utilities clearly delineate where mitigation activities will happen. 

"As a result of this weakness, the Energy Safety Office does not assess whether utilities plan to conduct these mitigation activities in areas of highest risk for wildfire as a condition for approving their mitigation plans," the report said. "Moreover, the CPUC conducts audits to determine whether utilities are in compliance with rules designed to ensure that they are operating safely, but those audits could be improved to better ensure such compliance, thereby helping mitigate the risk of utility-caused wildfires. Specifically, the CPUC does not consistently audit all areas in the utilities’ service territories, it did not audit several areas that include high fire-threat areas and it does not use its authority to penalize utilities when its audits uncover violations."

The state auditor said it had determined that utilities are making necessary improvements to the electrical grid, but that "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% of such lines."

It also called for the legislature to reduce the number of power shutoffs and amend the shutoff reduction law to require that utilities describe in mitigation plans the improvements that would be necessary to prevent power shutoffs on the circuits routinely affected by them.

The auditor said the legislature should require that the Energy Safety Office’s most recently completed compliance assessment of a utility’s mitigation plan find that the utility has "substantially implemented that plan."

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To better hold utilities accountable, the report urged the legislatures to require the CPUC to devise a risk-based audit plan for consistently auditing all utility service areas and prioritizing districts in high fire-threat areas and make a schedule of penalties for violations identified through its audit process and apply the schedule pursuant to its existing authority to impose penalties as established in state law.

Lastly, the Energy Safety Office should designate the prioritization of mitigation activities as a critical issue that must be addressed by utilities before it approves mitigation plans.

The report noted that while the CPUC "generally agreed with [its] recommendations," the Energy Safety Office disagreed with several.

The auditor noted that power lines have caused six of the Golden State's 20 most destructive wildfires since 2015, highlighting that while the average wildfire size and the area burned has annually increased, the cost of combating the fire has also grown. 

Cal Fire expenditures from fiscal years 2016–17 through 2020–21 nearly doubled and the state's fourth climate change assessment report issued in 2018 indicates that the average area burned by wildfires in California will increase 63% by 2100.

In February, PG&E filed its 2022 wildfire mitigation plan with California regulators, with plans to bury "at least 175 miles of power lines" this year and further increase the pace to have approximately 3,600 miles underground by 2026. 

Earlier this year, regulators linked the company to the massive Dixie Fire that burned nearly 1 million acres. Since 2017, the utility has been blamed for more than 30 deadly wildfires.

A PG&E spokesperson told Cal Matters on Thursday that it was still reviewing the audit report, but noted that its latest mitigation plan significantly accelerates the undergrounding of powerlines in high fire-risk areas.

CPUC reportedly said in a statement that the commission will "establish a plan and timelines toward implementing the recommendations identified in the California State Auditor’s report," and the energy safety office said that despite some "differences of opinion" the input was welcome.

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The report also includes responses from the agencies. 

According to Cal Fire, a total of 2,568,948 acres went up in smoke over the course of the 2021 wildfire season and the National Oceanic and Atmospheric Administration's (NOAA) spring outlook for 2022 forecast that the nation's crippling drought will expand amid warmer conditions.

The Associated Press contributed to this report.