Thomas Fuller and Ivan Penn

Yet few people in Lake County, or in many other fire-prone parts of California, could have anticipated the millions they are spending this summer on wildfires, even before the first big one ignites.

Insurance rates have soared in some of the riskiest places, and some insurers are refusing to renew policies. Lake County politicians are fretting over the more than $700,000 the county is spending to install backup power generators for the courthouse, sheriff’s department and other government buildings. The generators are necessary because the power company has announced that this year it will turn off the power when fire risk is high.

“It’s a lot of money for us, but I really feel we don’t have a choice,” said Dennis Darling, who owns a supermarket in Clearlake and is paying $100,000 to install a generator. “Every year we have these hellacious fires.”

The arrival of the peak fire season in California — a time of uninterrupted sunshine, hot winds and crackling-dry vegetation — has the state on edge. At every level, people are scrambling to prepare, from top politicians and officials to ordinary residents of Lake County, a community of 64,000 people with incomes around half the California average.

Gov. Gavin Newsom signed a bill this month to provide up to $21 billion in compensation for future wildfire victims. In March, he announced emergency measures to manage forests in vulnerable areas. Pacific Gas &amp; Electric, the electricity utility, has launched a fleet of drones to check aging power lines, which caused a number of recent fires, including the inferno that engulfed the town of Paradise, killing 85 people. Seven planes operated by the company are flying across the northern half of the state every day to look for possible fires.

“I think we can say with assurance that we are safer today than we were yesterday,” Bill Johnson, chief executive of Pacific Gas &amp; Electric, said in an interview. “But this risk exists and can’t be eliminated.”

Made worse by climate change, wildfires are adding a mounting financial burden in California, where taxes are already high and housing costs exorbitant.

To the north, Oregon and Washington state have had fewer wildfires so far this summer than were feared, but firefighters in the Northwest have shifted their attention to Alaska, where more than 900,000 acres have burned.

Pacific Gas &amp; Electric, which charges among the highest electricity rates in the country, is requesting that regulators approve an additional charge to customers of $2 billion over the next three years to help pay for wildfire safety improvements and other costs.

This is separate from the compensation fund approved last week, which includes more than $10 billion in costs to be borne by customers in the form of a levy on electricity bills for the next decade and a half.

And none of this will help pay the tens of billions of dollars in liabilities the company has for past fires where its equipment was involved.

Far fewer acres have burned in California compared with the same period last year. But firefighters are still worried.

“All this stuff burned, but it’s ready to burn again,” said William Sapeta, chief of the Lake County Fire Protection District.

On a tour of vulnerable areas, where a breeze carried the smoky odor of previous years’ fires, Sapeta pointed to the overgrown grass covering the hillsides after a winter of generous rains.

He said residents had become hypervigilant, calling 911 when dust rises up from nearby quarries or when they smell what turns out to be their neighbors’ barbecue.

Companies that study fire risk, like ImageCat or CoreLogic, estimate that one in 14 buildings in the state are at high or extreme risk.

“All of the factors that contributed to previous fires are still there,” said Tom Jeffery, a specialist with CoreLogic. “There’s no reason to think that we can’t replicate or — I hate to say this — we could potentially exceed what we saw in the past fires.”

David McGiffert, a resident of Topanga Canyon in Los Angeles, received notice from his insurance company several weeks ago that his homeowner’s policy would not be renewed because of wildfire risk.

McGiffert, a 77-year-old retiree, said he had been insured by the company, Allstate, since 1997 and had never filed a claim related to his home, which is not far from the area burned in last year’s devastating Woolsey Fire.

“I don’t have any idea what we’re going to do,” McGiffert said. “Our house is our equity. It’s what we have to leave our children.”

Other insurance companies want five times the $1,800 a year he currently pays, McGiffert said.

California offers a plan of last resort, but with limited coverage.

The California Department of Insurance does not keep data on the number of people who lose their insurance because of wildfire risks, but the number of complaints it received on the issue has increased steadily over the past eight years, to 276 last year from 41 in 2010.

Ricardo Lara, the state insurance commissioner, said communities needed to show insurers that they are lowering their risk by clearing vegetation, building more fire-resilient structures — and in some areas, curtailing construction.

“Local governments need to rethink their development in this new era,” he said.

Newsom started his first term in January with the state in a growing crisis tied to wildfires. Days after he took office, PG &amp; E filed for bankruptcy, reporting $30 billion in liabilities.

As part of a plan devised by Newsom to guard against future wildfires, the state Department of Forestry and Fire Protection, known as CalFire, for the first time designated areas in about 20 counties as priorities.

The hot zones span major metropolitan areas in Central and Southern California like San Diego and Fresno counties, as well as the communities of Carmel Highlands in Monterey County and parts of Mendocino and Contra Costa counties. The hope is to prevent the kinds of huge fires that devastated the state’s wine country in 2017.

“I don’t think anybody imagined that fires could get that large and that destructive,” said Pedro Pizarro, president of Edison International, the parent company of Southern California Edison, the major utility in the Los Angeles area.

Edison has targeted locations that the company predicts will be in need of protection in the next several months. They include the Shaver Lake area in Fresno County, where the Big Creek hydroelectric plant sits. Edison has carried out controlled burns to prevent the spread of any fires that might start in the region.

Some worried residents are taking their own steps, buying generators and batteries so they can disconnect from the grid. The California Solar and Storage Association says it has seen a spike in interest in home battery systems.

“Those people who do have solar are now coming back for battery backup,” said Rainier de Ocampo, vice president for marketing at Solar Optimum, a solar power and storage contractor. “We’re seeing more and more of that over the last three or four years now, because of the threat of wildfires, the threat of an earthquake.”

Susanne Polos said she and her husband decided last fall that they needed their own energy storage system. The Polos live in Contra Costa County, which has one of the two largest areas on the governor’s priority list with more than 26,000 acres designated for wildfire protection.

Polos, a nurse, recalls the power going out 10 times in the past year. If she and her family need to get out because of a fire, she said, she wants to be able to keep her electric car charged.

“Me getting a battery is more about emergency preparedness,” Polos said.

Pete Parkinson, a retired city planner in Santa Cruz and Sonoma counties, said the wildfires of recent years have led to a broad reassessment of how much the state can protect its residents.

“I’m going to be 65 this summer,” Parkinson said. “When I think back what life was as a young boy in California, you always felt like you were in this blessed place. Yeah, we had earthquakes once in a while. But there was an idea that if you lived in a developed place, a subdivision, that you were safe. The increasing fire hazards has put the lie to that.”

Parkinson published an article last year that amounted to a mea culpa as a city planner. “We thought we had adequately anticipated the hazards and had planned accordingly,” he wrote. “We were wrong.”

Where is safe? Bonnie Ramsey had a ranch house outside Clearlake surrounded by meadow, with mature oak trees spaced far apart. Her house and many of her neighbors’ homes burned in 2016. But several hundred yards away, a road thickly shrouded in vegetation was untouched.

Ramsey has rebuilt, but she still sometimes wakes up and feels as if she is in a stranger’s home. She reaches into her kitchen drawer for a potato peeler, but realizes she is thinking of her old kitchen. The only items that survived the fire were a porcelain cookie jar and candle holders.

“I don’t think it’s something that we’ll ever get over,” she said.

This article originally appeared in <a href="https://www.nytimes.com/2019/07/22/us/california-wildfires-costs.html" id="3b111afb-d414-377b-a64e-cd51c0476baa">The New York Times</a>.

CLEARLAKE, Calif. — Two thousand homes lost and two-thirds of the land burned: The residents of Lake County, a sparsely populated area north of Napa Valley, understand better than most the devastating cost of wildfires in recent years.

California, Wary of More Wildfires, Is Paying for Them Already

Two days after that announcement, under blue skies at a baseball diamond on the edge of San Francisco’s financial district, the city’s mayor, Ed Lee, threw out the first pitch for a charity event sponsored by that same utility, Pacific Gas &amp; Electric.

“PG&amp;E; is a great local company who gets it,” the mayor, who died in 2017, said at the event.

For critics of PG&amp;E;, Lee’s praise was a symbol of a recurring frustration: Despite evidence that the company was responsible for repeated safety violations and involved in deadly wildfires, lawmakers in California continued to benefit from political donations from the company.

Investigators are now determining whether PG&amp;E; equipment was responsible for the state’s deadliest wildfire, the November inferno in and around Paradise that killed 85 people and destroyed more than 13,000 homes. A PG&amp;E; spokeswoman on Saturday confirmed that the company had canceled a plan to pay $130 million in bonuses after an outcry by the families of fire victims.

With the state’s tech giants focused on their influence in Washington, perhaps no company in California is more entangled with local Democratic politics than PG&amp;E;, which in January filed for bankruptcy.

PG&amp;E;’s restructuring — a process that directly affects 40 percent of the state’s residents — will test whether Gov. Gavin Newsom and other Democratic leaders can push to create a company free from what critics say has been a culture of cronyism between regulators and the regulated.

“Their tremendous political influence at the state and local level has led them to believe that they are above scrutiny and reproach,” said Aaron Peskin, a member of the San Francisco board of supervisors and a Democrat. “If Pacific Gas and Electric spent as much time and money and effort running their gas and electrical facilities as they did on politics they wouldn’t be in this mess right now.”

Filings with the California secretary of state show that PG&amp;E;, which serves 16 million customers, spent $10 million on lobbying last year. While it is not unusual for energy companies to lobby, PG&amp;E; spent roughly twice as much last year as another investor-owned utility, Southern California Edison, which has around 15 million customers.

Over the past decade, filings with the California secretary of state show that PG&amp;E; spent $9 million on around 900 in-state campaign contributions. The company gave to a diverse group of candidates running for offices ranging from county board of supervisor to state treasurer. PG&amp;E; gave to both the state Democratic and Republican parties.

Newsom, who was elected governor in November, does not appear as a recipient of direct donations. But the final destination of PG&amp;E;’s campaign donations are in many cases unclear: Over the past decade the company contributed around 245 times to political action committees which in turn made their own donations.

There is recognition in California that PG&amp;E;, the largest electric and gas operation in any state around the country, has an increasingly difficult job.

The company delivers dangerous commodities — gas and electricity — to homes in many semirural areas made more vulnerable to wildfires by a changing climate. Under California law, the company is liable for fires caused by its equipment even if it was not negligent.

As with many large for-profit companies, lobbying for more favorable regulations is seen as an essential cost of business. The company says its political contributions and lobbying expenses are paid for with shareholder funds, not utility customer dollars. The same is true, the company says, with its charity program: Since 2000, the company and its foundation have granted more than $100 million to nonprofit organizations.

And as part of its wildfire-prevention efforts, the company has spent $2.3 billion over the past six years to trim vegetation around power lines. “Our most important responsibility is safety, and that continues to be our primary focus,” said Melissa Subbotin, a spokeswoman for the company.

Yet California officials whose communities were devastated by the San Bruno explosion and the spate of fires that have been linked to Pacific Gas &amp; Electric equipment say they have been frustrated in their efforts to hold the company accountable.

After the pipeline explosion, the city of San Bruno sued to obtain thousands of emails between PG&amp;E; executives and the state’s utility regulator, the California Public Utilities Commission.

The emails revealed that a PG&amp;E; executive complained to the commission about a judge assigned to determine who should pay for pipeline upgrades, a case with major financial consequences.

In what became known as the judge shopping scandal, PG&amp;E; was granted the administrative judge of its choosing. The company was fined $1 million after the scandal became public, a sanction that critics said was a slap on the wrist for a company with annual revenues of $17 billion.

Other emails obtained by San Bruno described how company executives socialized and casually discussed company projects with the official meant to be regulating them. A 2010 dinner between a top PG&amp;E; lobbyist, Brian Cherry, and Michael Peevey, who was then president of the Public Utilities Commission, took place at Peevey’s vacation home and became famous for the “two bottles of good Pinot” that they drank. Cherry and two other executives at the company were fired after the emails became public.

Jim Ruane, former mayor of San Bruno, tried to have the staff of the California attorney general at the time, Kamala Harris, bring charges for what he said was illegal cooperation between the company and regulators.

“They just blew us off,” said Britt Strottman, a lawyer who represented San Bruno after the pipeline explosion.

A year later, a state senator, Jerry Hill, wrote to Harris to renew calls for an investigation.

“The response we got was ‘thanks for the letter — go away,'” Hill said.

Chris Harris, head of communications for Kamala Harris, who is now a U.S. senator and a 2020 presidential candidate, said an investigation was opened while she was attorney general.

“There is no way for us to know the current status of that ongoing investigation, but she believes that if there is evidence to support them, charges should be filed against any and all bad actors so they can be held fully accountable for their actions,” Chris Harris said. The office of the current attorney general, Xavier Becerra, would not confirm whether an investigation was still open.

Kamala Harris did not receive any contributions from PG&amp;E; for her successful campaign for Senate, her spokesman said.

The larger question in the restructuring of the company, critics say, is how much political links will be tolerated.

SCRB Strategies, a political consultancy that helped run campaigns for Harris, Lee, Newsom and Jerry Brown, the previous governor, received more than $1.1 million from PG&amp;E; last year for research and consulting.

Willie Brown, a longtime Democratic power broker and a former mayor of San Francisco and speaker of the California Assembly, said in an interview that he has consulted for PG&amp;E; for the past decade, and recently approached Newsom with a message that the company paid him to deliver.

Brown declined to give details on the discussion or when it occurred, but said he hoped to continue lobbying for PG&amp;E;, even in bankruptcy.

“I hope that they call me because every call generates an invoice,” he said.

A spokesman for Newsom said he had no comment. But the governor has said PG&amp;E; lacks public trust.

“I can assure you when it comes to our engagement with PG&amp;E;, it’s trust but, dare I say, verify,” Newsom said shortly after the bankruptcy filing.

PG&amp;E; representatives have acknowledged that the company has a “credibility problem” and that it must change.

Hill, the state senator, and others are skeptical.

“I have heard this story so many times — we are a new company, we have changed, safety is our new culture — I don’t believe a word they say at this point,” Hill said. “They are going to have to show me that they’ve learned from these tragic episodes.”

Anthony Rendon, speaker of the California Assembly, said it is too early to know what the company will look like after it emerges from bankruptcy.

“Their power has certainly waned,” Rendon said. “And honestly I think a number of our colleagues feel let down by them.”

In a hearing last month, William Alsup, a federal judge who has ordered a sweeping overhaul to the company’s wildfire-prevention practices, also sounded skeptical of the company’s ability to change.

“There’s a very clear-cut pattern here — that PG&amp;E; is starting these fires,” Alsup said to a packed courtroom. “What do we do? Does the judge just turn a blind eye and say, ‘PG&amp;E;, continue your business as usual. Kill more people by starting more fires?'”

When company representatives said it would take eight years for the safety overhaul, the judge shot back.

“We can’t sustain an eight-year delay,” he said. “This is an emergency.”

This article originally appeared in <a href="https://www.nytimes.com/2019/02/23/us/pge-california-politics.html" id="f1206b63-6cc4-312d-aecc-93ed7b3815a4">The New York Times</a>.

The Political Playbook of a Bankrupt California Utility

SAN FRANCISCO — Eight years ago, federal investigators announced that a “litany of failures” by California’s largest utility had caused a massive gas explosion that killed eight people, injured 58 and incinerated a neighborhood in the San Francisco suburb of San Bruno.

Investigators are now determining whether PG&amp;E; equipment was responsible for the state’s deadliest wildfire, the November inferno in and around Paradise that killed 85 people and destroyed more than 13,000 homes.

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Thomas Fuller and Ivan Penn

Articles written by the author

California, Wary of More Wildfires, Is Paying for Them Already

The Political Playbook of a Bankrupt California Utility

The Political Playbook of a Bankrupt California Utility