California Lawmakers Vote on Utility Wildfire Liability Bill

California lawmakers are scheduled to vote Tuesday on Senate Bill 492, a compromise measure designed to address utility wildfire liability. The legislation establishes a program to accelerate payouts to wildfire survivors and prohibits hedge funds from profiting from wildfire claims. Notably, the bill bars utility executives from receiving bonuses if their company's equipment sparks a fire that damages or destroys more than 500 buildings.

Gavin Newsom reached this compromise after lawmakers rejected a more ambitious proposal he supported, which would have limited the financial liability of electric companies and prevented insurance companies from suing utilities for reimbursement. Because the bill includes an urgency clause to bypass the August 31 session deadline, it requires a two-thirds legislative majority to pass and will take effect immediately upon signing.

Survivor groups, including the Every Fire Survivor's Network, and the American Property Casualty Insurance Association support the measure. However, Pacific Gas & Electric argues the bill does not adequately address financing risks or rate stabilization. Consumer advocates from The Utility Reform Network and State Senator Josh Becker have emphasized the need for executive accountability to ensure leadership feels the financial impact of equipment-caused disasters.