(Reuters) -California’s $21 billion wildfire fund may shield Edison International’s balance sheet if equipment owned by the company’s electric utility is found to have caused a deadly Los Angeles fire last month, Edison’s CEO said on Thursday.
Southern California Edison, one of the state’s largest electric utilities, faces a swelling number of lawsuits claiming its power lines caused the Eaton Fire in the foothills near Pasadena.
The California Wildfire Fund, which allows the state’s utilities to recover some wildfire-related claims payments, has $21 billion and has been largely untapped by investor-owned utilities like Southern California Edison, Edison International CEO Pedro Pizarro said on a call with investors.
“We have confidence in the fund,” he said.
The Eaton Fire was one of multiple blazes that broke out in the Los Angeles-area on January 7 in what became the most costly natural disaster in American history. No official cause for the major fires, including Eaton, has been released.
SCE will likely begin burying more lines underground as a wildfire mitigation effort, Edison executives said on a conference call with investors.
Edison International shares have fallen 35% since the start of the wildfires as investors worry the company could face massive liability claims.
When pressed by Wall Street analysts for how long it might take to determine the cause of the fire, Pizarro said it was too hard to know the timing. “You might recall from previous fires, it has taken 12 to 18 months even to get an investigation report from official fire authorities that might help one make conclusions,” he said.
The company said the fire investigation is also focused on examining and testing an idle transmission line, which also is suspected of being a potential ignition source.
The equipment on the line will be examined for arc marks and missing metal pieces, for example. The company said that process may still take many weeks as it requires agreeing on a protocol with plaintiffs’ attorneys and other interested stakeholders.
(Reporting by Laila Kearney in New York and Tim McLaughlin in Boston; Editing by Leslie Adler, Sonali Paul and David Gregorio)
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