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Southern California Edison’s plan to compensate victims of Eaton Fire Service was skeptical of lawyers representing Altadena residents on Thursday, but it garnered interim support from others who say the initiative could help support the state’s $21 billion wildfire fund.
The utility announced its Wildfire Recosion compensation program this week. It says it will be used to quickly pay victims, including those, while avoiding long-term lawsuits.
The announcement comes as state officials consider ways to reinforce their state funds to compensate wildfire victims amid fears that Eton Fire claims could be completely exhausted. Fees received by lawyers as part of the victim’s settlement could further burden the fund.
State Sen. Henry Stern (D-Calabasas) said Edison’s new program could have some advantages as a “more efficient way” than litigation to ensure victims are significantly compensated.
He noted that his lawyers “confronted the nation” the Eton Fire Department casualties. “When you pay these lawyers 30%, are they really getting the value of their money?” Stern asked.
Mark Tony, executive director of Utility Reform Network, said Edison’s program could reduce the costs that Wildfire Fund, which was partially established, needs to be covered by the additional fees on invoices paid by clients of Edison, Pacific Gas & Electric.
“If Edison is determined to be the cause of the fire, anything they can resolve early will reduce the costs paid later,” Tony said.
The utility has released most details about how the program works, leaving victims already dealing with uncertainty with more questions. And the attorney who was trying to represent the victim in the case against Edison promptly called out to the caution.
“Without acknowledging negligence or providing transparency, Edison asks the victims to waive their rights,” said one of the dozens of lawyers involved in the lawsuit against Edison due to the January 7 wildfire.
According to Edison, the program is open to people who have lost their homes and businesses and renters who have lost their wealth. It also covers people who have been injured by smoke, suffered physical injuries, or have died.
“People can still file claims even if they are involved in an aggressive litigation,” said Kathleen Dunleavy, Edison spokesperson.
Dunleavy said the company will soon release more information, including eligibility requirements.
At a meeting Thursday in Sacramento of the Catastrophe Response Council, which oversees the Wildfire Fund, officials said they were creating standards that must follow the program’s design, including measures to prevent fraud and clear eligibility standards.
Milliman actuary Sheri Scott told the council that the company estimated losses from Eton Fire ranged between $13.7 billion and $22.8 billion.
“I heard from our guests today that we might run out of money soon,” said Paul Rosenstiel, a council member appointed by Gov. Gavin Newsom.
He urged state legislators to consider changes to the law that created the fund, reducing the risk of flowing to third parties who are not victims of the fire.
PG&E has created a program that directly pays victims of the 2021 Dixie Fire, which burned more than 960,000 acres in Northern California. We have created a similar program to compensate victims of the 2022 mosquito fire. This burned about 77,000 acres in Placer and El Dorado counties.
PG&E said it provided victims of mosquito fires that lost $500 per square foot and $9,200 per acre for those who don’t exceed five acres. To support the rebuilding effort, the victims who decided to rebuild their homes were eligible for an additional $50,000.
PG&E spokesman Lindsay Paulo said in an email that he paid nearly $50 million to Dixie Fire victims through the program. The money was sent to 135 households, she said.
“PG&E’s program is designed to provide claimants with resources to rebuild as quickly as possible and help their community recover,” she said.
Richard Bridgeford, an attorney representing Dixie Firefighters, said PG&E offers were lower than those won in the lawsuit, and only a small percentage of those eligible for the PG&E program decided to participate.
“The victims did well evenly when represented by lawyers,” Bridgeford said.
The announcement of Edison’s program comes as fire agencies continue to investigate the cause of the Eaton fire. Edison said in April that the main theory was somehow replicated and caused the flames, the last dormant propagation line used in 1971. The company says the new compensation program is “not a legal liability admission.”
“While details of how Eaton Fire is still being evaluated are still being evaluated, SCE provides a quick process to pay and resolve claims fairly and promptly,” said Pedro Pizzarro, chief executive of Edison International, the utility’s parent company, in a news release. “This will allow the community to focus more on recovery rather than on long, expensive litigation.”
The utility said it hired consultants Kenneth R. Feinberg and Kamille S. Bilos who were involved in the September 11 Victims Compensation Fund to help design the program.
If Edison is determined to be responsible for the fire, the $21 billion state wildfire fund will refund the company all or most amounts paid to the victim through a new program or litigation and insurance claim.
Half of the fund’s $21 billion comes from charges to electricity bills for Edison, PG&E, and SDG&E customers. The other half was donated by shareholders of these three companies. This is the only utility that allows you to request a refund from the fund.
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