A utility serving rural Northern California wants power rates to climb by more than half as wildfire costs mount under Democratic Gov. Gavin Newsom.
Pacific Power, which serves the state’s far northern corner, asked the California Public Utilities Commission (CPUC) on Nov. 6 to raise its rates by 57 percent beginning Jan. 1, 2027, its application shows. The company’s website says that a 14 percent decrease, which also takes effect Jan. 1, will partially offset the hike.
The company’s filing cites the cost of wildfire work, like trimming trees and strengthening lines, as well as insurance and inflation. Pacific Power told Jefferson Public Radio (JPR) that the change would add about $120 to customers’ bills each month.
“The $120 number does not account for the 14% decrease related to lower than expected power costs,” Simon Gutierrez, a Pacific Power communications representative, said in a statement to the Daily Caller News Foundation.
“Not only is the fire risk extreme, but our service area is very sparsely populated,” Gutierrez told JPR. “It means fewer customers to spread the costs of these investments.”
Pacific Power has about 46,000 California customers, scattered over a service area topping 11,000 square miles in Siskiyou, Del Norte, Modoc and Shasta counties, according to the filing. Gutierrez told JPR that it comes to roughly four customers for each square mile.
The company’s website touts the work it has done since 2022: more than 300 miles of line covered and reinforced, and over 7,000 wooden poles replaced with steel or fiberglass.
In all, Pacific Power is seeking about $103.4 million more, the filing shows. Residential rates would rise 56.9 percent under the request.
Some of the money would pay back wildfire and insurance costs Pacific Power has been running up. The company expects to have about $93.8 million in wildfire mitigation costs and $11.1 million in insurance premiums on its books by the end of 2026 that current rates don’t cover, the filing says. It’s asking to collect that across six years instead of all at once.
More than two months have passed since Newsom’s wildfire liability deal with legislative leaders fell through at the end of the session. KQED reported that the Democratic-controlled Assembly never took a vote on it.
Newsom’s first version would have moved more of the wildfire risk from utilities onto home insurers, KQED reported. Part of the plan would have stopped insurers from suing to recoup what they paid fire victims. Insurers, attorneys and fire-victim groups fought that plan as a utility bailout, and Democratic lawmakers rebuffed it, the outlet reported.
Newsom had signaled that the deal did not go far enough. In an Aug. 29 statement after it was announced, he said that “this system needs full structural reform — not a partial one.”
He called on lawmakers to come back next year and “finish the work we started,” including efforts to “stabilize electricity rates.”
“The communities we serve in California are facing some of the highest fire risk in the country. These are critical upgrades needed to protect these communities,” Gutierrez said in his statement. “The costs of the materials needed to make these investments have gone up dramatically.”
On Sept. 1, Newsom asked the CPUC to report on what the state’s failure to pass structural wildfire reforms is doing to utilities. The commission’s Nov. 1 report warned that wildfire costs “will continue to increase utility bills” if nothing changes.
“Without reform, even this status quo is likely unsustainable,” the commission wrote.
The report found that at the state’s three biggest investor-owned utilities, wildfire costs make up roughly 10 percent to 14 percent of a typical household’s bill. Inland Pacific Gas and Electric customers have it worst, at 29 percent of the average bill. Along the coast it is 16 percent.
Utilities have spent “further tens of billions of dollars” on mitigation work the state requires, and those costs will be passed along to ratepayers, the report noted.
Newsom signed the 2019 law that created California’s wildfire fund, which was set up with about $21 billion to pay claims. Ratepayers are paying for $10.5 billion of it through a charge on their bills, the CPUC report shows.
Newsom also signed Senate Bill 254 in 2025, which created a second account that could pay up to $18 billion more in claims but holds no money yet. Customers could end up paying up to $9 billion of that from 2036 to 2045, the report said, but only if the fund needs it and the CPUC signs off.
Pacific Power is not part of the fund. The report noted that PacifiCorp, the company that does business as Pacific Power, is one of the utilities that “do not have access to the Wildfire Fund under existing State law.”
“I just signed into law the biggest electricity bill refunds in a decade — up to $60 billion to help bring down costs for California families,” Newsom said in a Sept. 19, 2025, press release announcing the package.
Californians paid an average of 32.58 cents per kilowatt-hour for residential power from January through August, Energy Information Administration figures show. That was the second-highest rate in the country after Hawaii and well above the national average of 18.19 cents.
Edward Ring, director of water and energy policy at the California Policy Center, said in a statement to the DCNF that state policy shapes most of what Pacific Gas and Electric customers pay. Working from what he called a typical rate of 35 cents per kilowatt-hour for the utility, he estimated that changing those policies could eventually bring it down to about 21 cents.
“In the meantime, it was the state that was most negligent,” Ring said. “They forced the utilities to (1) purchase more expensive renewable electricity, (2) still keep their lines clear of flammable material, and (3) keep their rates to the consumer down. That was an impossible request.”
Jason Isaac, CEO of the American Energy Institute, said in a statement to the DCNF that Democrats serious about affordability should back more nuclear power, natural gas and coal.
“Americans need more dependable electricity and fewer government obstacles driving up the price,” Isaac said.
PacifiCorp also agreed in February to a $575 million settlement of federal claims tied to six fires in California and Oregon, including the 2020 Slater Fire and the 2022 McKinney Fire in California, the Justice Department announced. The department noted that the claims were “allegations only,” and PacifiCorp still denies liability.
In Oregon, an appeals court in April reversed and remanded a class-action judgment against PacifiCorp, the CPUC report says. The state’s highest court took up the case and heard arguments Nov. 3, Oregon Public Broadcasting reported.
Jurors had found PacifiCorp grossly negligent in 2023 for starting four fires over Labor Day weekend in 2020, the outlet reported. The court will decide what happens to the more than $1 billion that about 200 survivors have been awarded so far. Its ruling could also determine whether about 2,000 more claims get considered.
S&P Global Ratings cut PacifiCorp’s credit rating three times between June 2023 and November 2025, citing wildfire litigation among its reasons, the CPUC report says. The agency then put the company on watch for a further downgrade in March. After the April appeals ruling, S&P revised its outlook on PacifiCorp to positive. PacifiCorp had put its probable wildfire losses at about $2.85 billion as of June 30, settlements included, the report noted.
PacifiCorp is now rated one notch above junk, its filing says. Under current rates, the company says it would earn a negative 2.636 percent return on equity in California.
Pacific Power has not always gotten what it wanted from regulators. When it sought a 25.7 percent overall increase in 2022, the CPUC approved roughly 17.5 percent in December 2023.
“We understand the magnitude of this request,” Gutierrez said in his statement. “This filing is the beginning of a process, and we welcome a review and discussion about what the right balance is between wildfire investments and rates for our California customers.”
The company wants the rates to take effect Jan. 1, 2027, but its website notes that the CPUC’s review may last several months.
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