"Gov. Gavin Newsom is proposing a multibillion-dollar wildfire fund to help California’s utilities cover mounting fire-related liability costs that have threatened their financial health", according to a story published in the Wall Street Journal.
"The fund is part of a wider regulatory overhaul the Democratic governor unveiled Friday as he seeks to reach consensus with state lawmakers on fixing the crisis created by the collapse of PG&E Corp. , which sought bankruptcy protection in January after its role in sparking wildfires created more than $30 billion in potential liabilities."
"Concerns about massive wildfire-related liability costs are also weighing on California’s two other major investor-owned utilities, Edison International's Southern California Edison and Sempra Energy's San Diego Gas & Electric, spurring downgrades to their credit ratings and putting pressure on politicians to act.
"Mr. Newsom outlined two possible models for a wildfire fund—one valued at $10.5 billion and another at $21 billion, aides to the governor said", and reports the Journal article.
"The $10.5 billion proposal would be structured as a revolving loan funded by extending a surcharge on electricity bills and securitizing the revenue through state-issued bonds. The $21 billion proposal would double the amount by including an insurance policy requiring a $10.5 billion contribution from the three utilities."
"Under Mr. Newsom’s proposal, Southern California Edison and San Diego Gas & Electric would choose which option they prefer, with PG&E bound by whatever they decided but excluded from the decision-making process, the governor’s aides said."
"“PG&E’s leadership is committed to continuing to work with the governor and all stakeholders on shared solutions that will compensate wildfire victims fairly and equitably and mitigate the ever-growing threat of wildfire risk,” the company in a statement."
To read the complete Wall Street Journal article, go to: https://www.wsj.com/articles/gavin-newsom-proposes-wildfire-fund-to-bolster-pg-e-other-california-utilities-11561140001