The Fire Next Time

California is inching its way toward a program for mitigating future damages by utility-caused wildfires. [bold added]

Paradise, 2018 (Chron photo)

[Gov. Gavin] Newsom has proposed extending a Department of Water Resources charge that was originally imposed because of the energy crisis in the early 2000s. The charge could be extended for more than a decade, netting as much as $10.5 billion.

Under the first financing option, known as a “liquidity fund,” the state would be able to provide a line of credit for utilities to pay wildfire claims. But the utilities would have to reimburse the fund.

The second option would work more like insurance, paying out claims directly. If all three utilities [Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric] participated, they would match the $10.5 billion charge by providing $7.5 billion up front and annual payments of $300 million to finance the rest, all with investor — as opposed to ratepayer — money. The insurance fund, which would be managed by the state, could take other steps — including buying reinsurance — to bring its total capacity up to about $40 billion, according to the governor’s office.

Ratepayers, taxpayers, existing bondholders, and stockholders will all have to contribute to the fund. In the 1980's PG&E stock was one of our first investments, using Peter Lynch's investment principles. We got out 15 years ago when the energy industry began to change, and it didn't look like PG&E had a handle on what was happening.

By the way, in the stampede toward solar energy the fire danger may be increasing due to higher geographic dispersion and more exposure to the atmosphere than a traditional power plant. Articles:

Fire Concerns with Roof-Mounted Solar Panels

(Photo from blfirerisk)

One of the many dangers to solar panels is how the panel and its mounting system impact the combustibility of the overall roof system. Some solar panels, for example, include a backing of highly combustible plastic.

In laboratory-based fire tests of roof assemblies, the maximum allowable fire spread is between approximately 20 and 40 ft2 (1.9 and 3.7 m2), depending on whether an A, B or C rating is desired. In actual roof fires with roof-mounted solar panels, fire damage has involved areas of between 1,000 and 183,000 ft2 (93 and 17,000 m2). In the most extreme case the fire spread to the inside and destroyed the entire building.

‘Avian Incident’ Knocks Out 84% of Massive California Solar Farm

An “avian incident” sparked a fire at one of California’s biggest solar farms, affecting 1,200 acres and knocking out 84% of the California Valley Solar Ranch’s [250 megawatt] generating capacity.

A Huge Solar Plant Caught on Fire, and That's the Least of its Problems

On Wednesday, May 25, [2016] Ivanpah's operator, NRG energy, confirmed the fire was indeed caused by mirrors that did not track the sun properly, which focused sunlight onto the wrong part of the tower [in San Bernardino County].