Safety Certifications

On July 12, 2019, Governor Gavin Newsom signed Assembly Bill (AB) 1054 (Holden). AB 1054 was enacted to reduce utility-ignited wildfires through investments in electrical grid resiliency and mandated utility safety reforms, and to protect electricity customers from rate increases through creation of the California Wildfire Fund (Fund).  The Fund operates as an insurance fund for California’s three largest investor-owned electric corporations, reimbursing them after they pay damage claims of victims of utility-caused wildfires.

To encourage electrical corporations to invest in safety and make changes to limit wildfire risks and reduce costs, the statute also provides for electrical corporations to seek a “safety certification.” Having a safety certification affects the amount, if any, the electrical corporation must repay the Fund for costs and expenses associated with a covered wildfire.  Electrical corporations that are found to have acted reasonably by the CPUC do not have to repay the Fund.  In general, the electrical corporation must prove that its conduct was “reasonable.”  However, an electrical corporation that received a safety certification for the period in which the covered wildfire ignited is presumed to have acted reasonably unless demonstrated otherwise. (Pub. Util. Code § 451.1(c).)  A safety certification also may limit the amount the electrical corporation will be required to repay the fund if it is found to have acted unreasonably. (Pub. Util. Code § 3292(h).)

To obtain a safety certification, the electrical corporation must demonstrate that it satisfies the conditions of Public Utilities Code Section 8389 (e)(1-7).

Safety Certification FAQs