Utility Company Agrees to $575M Settlement Over Western Wildfires

PacifiCorp will pay $575 million to settle federal claims that its power lines sparked six deadly wildfires in Oregon and California between 2020 and 2022. The settlement brings the utility's total wildfire-related payouts to over $2 billion as it faces ongoing lawsuits from the devastating blazes.

Federal authorities announced Friday that PacifiCorp has reached a $575 million settlement to resolve government claims stemming from six catastrophic wildfires that occurred in Oregon and California during 2020 and 2022.

According to the Justice Department, the agreement addresses allegations that the utility’s power lines were responsible for igniting four Oregon fires in 2020 and two California fires in 2020 and 2022. The settlement funds will go toward restoring approximately 290,000 acres of burned public lands and reimbursing firefighting expenses.

“This settlement served the Department’s longstanding policy of holding individuals and corporations responsible for damages caused by wildfires. Every fire impacting federal lands, no matter the size, is a priority,” stated U.S. Attorney Eric Grant of the Eastern District of California.

The Justice Department emphasized the importance of recovering firefighting costs, noting that “the U.S. Forest Service now spends more than half of its budget on wildfire suppression annually.”

PacifiCorp released a statement saying the agreement reflects its continued efforts to resolve wildfire-related claims, with total settlements now exceeding $2 billion.

The utility company continues to battle numerous lawsuits connected to Oregon’s devastating 2020 fires. Multiple jury verdicts have already ordered PacifiCorp to pay hundreds of millions in damages to fire victims.

A significant 2023 Oregon jury ruling found PacifiCorp liable for negligent conduct after failing to shut off power to 600,000 customers despite fire danger warnings from officials. The jury’s determination of negligent and willful behavior resulted in punitive damages for a class of property owners, with over 1,000 additional cases scheduled for trial in 2026 and 2027.

The company has appealed this verdict and the case remains in state court.

The Labor Day weekend fires of 2020 rank among Oregon’s most devastating natural disasters, claiming 11 lives, destroying thousands of homes, and burning over one million acres. California’s 2020 Slater Fire and 2022 McKinney Fire also resulted in multiple fatalities.

This week, PacifiCorp announced plans to sell its Washington state wind, natural gas, and distribution operations to Portland General Electric for $1.9 billion as part of efforts to strengthen its financial position. The company has been required to post court bonds while appealing wildfire judgments, creating cash flow challenges.

“Improve the company’s financial stability while simplifying our operations,” CEO Darin Carroll explained Tuesday, adding that the sale would help ensure reliable service for Washington customers.

While PacifiCorp’s parent company, Warren Buffett’s Berkshire Hathaway, maintains over $382 billion in cash reserves, the conglomerate expects its subsidiary to handle its own financial obligations. Greg Abel, who previously headed Berkshire’s utility division, now serves as the company’s CEO.