Wyoming’s governor has signed a bill that limits the liability for electric utility companies found guilty of starting wildfires.
Legislators argued that the bill was necessary for utility companies to function in an era of massive fire-related class-action lawsuits, especially for many of the smaller, co-op utilities that are a hallmark of the mountain west.
“We are one wildfire away from bankruptcy for these small utilities and these cooperatives,” the Wyoming Republican representative Jeremy Haroldson said in a floor debate in February.
Wyoming’s legislation pokes at a question crucial in today’s American west. Wildfires are tearing across the region summer after summer, often sparked by power lines or negligent utility maintenance. Utility companies are seeing soaring insurance rates. Who pays for damages?
Some western legislatures have ushered through bills that offer utilities a reduced level of liability if they produce a wildfire-mitigation plan, often by modifying what constitutes acceptable damages. States that are weighing bills this year include Montana, Arizona, Idaho, Oregon and New Mexico. Utah passed similar legislation in 2020.
Proponents say the bills are crucial for effective wildfire prevention and keeping utility companies in the black when wildfire insurance rates are rising at an explosive pace. Rocky Mountain Power began a push for a 14% rate hike (now negotiated to 10%) on its Wyoming customers by saying their liability insurance had risen 1,888% in the last five years – due to wildfires.
“We recognize the impact that the rising costs of providing electric service has on customers,” said Dick Garlish, the Rocky Mountain Power president, in a prepared statement last August. “The dynamic economic conditions we face are similar to those challenging all other electric providers in the nation.”
Past wildfire survivors are skeptical, at best, of this type of legislation. One survivor, Sam Drevo, spoke with the Oregon Capitol Chronicle in February.
“Do you think the legislature should be taking care of PacifiCorp while Oregonians who were burned up in 2020 and 2022 are still suffering, not able to rebuild and move on with their lives?” Drevo said.
One thing that can be agreed on: the financial stakes are huge.
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California’s PG&E filed for bankruptcy in 2019 after being found liable for catastrophic wildfires, ultimately paying out more than $25.5bn to settle its liabilities. PG&E exited bankruptcy and reincorporated in 2020. Lawmakers in the Golden state gave utilities permission to collect $27bn from ratepayers for fire prevention between 2019 and 2023. This past winter’s wildfires will be the first major test of the pooled fund.
PacifiCorp was found liable for the state’s 2020 Labor Day wildfires, and has been ordered to pay out more than $270m in damages to wildfire victims. Plaintiffs have yet to be compensated, as PacifiCorp plans to appeal the verdict; and, according to the Oregon Journalism Project, 30 victims have died since the case began.
PacifiCorp is owned by the billionaire Warren Buffett’s Berkshire Hathaway Company. Its subsidiary Pacific Power operates in Oregon, California and Washington, while its subsidiary Rocky Mountain Power operates in Wyoming, Utah and Idaho. According to 2024 filings, PacifiCorp is facing at least $46bn in claims for wildfire negligence.
