California utilities seek liability cap amid wildfire investigations

Southern California Edison and other for-profit utilities in California are lobbying for legislation that would limit their financial liability for catastrophic wildfires they cause, the Los Angeles Times reported. This push comes as a criminal investigation continues into Southern California Edison's actions before last year's deadly Eaton fire.

According to slides presented by a Pacific Gas & Electric executive to state senators, the utilities want a permanent cap on their liability for fires linked to negligence or imprudence. The utilities argue that without such a cap, their credit ratings have suffered, leading to higher borrowing costs that ultimately affect customers.

Consumer advocacy groups have criticized the proposal, saying that if ratepayers cover most wildfire costs, utilities may lack incentives to prioritize safety and fire mitigation. New evidence and court filings have raised questions about Southern California Edison's safety claims before the Eaton fire.

Executives from Edison and PG&E have told investors that without liability protection, they might reduce investments in wildfire safety. However, Edison officials maintain that safety remains their top priority despite the lobbying efforts.

The legislative push aims for action in 2026 to address wildfire liability and financial stability for utilities operating in California, which has faced increasing wildfire threats in recent years.