Edison Probing Retired Power Line as Possible Start of LA Eaton Fire

(Bloomberg) -- Edison International’s utility is looking at whether a power line retired in 1971 started the Eaton wildfire as part of a probe into the cause of the blaze that razed more than 9,000 structures. 

Southern California Edison found evidence of potential arching and other damage on grounding equipment for two of the three decommissioned transmission lines at a tower about 5 miles from the suspected origin of the blaze, according to a letter filed Thursday with regulators. The utility said it didn’t know when the damage happened and it didn’t find arching or other problems on its retired tower and lines near the fire. Still, Edison says it’s possible the retired equipment became energized.

Edison said the line, taken out of service more than half a century ago, was regularly inspected. 

“While we do not yet know what caused the Eaton wildfire, SCE is exploring every possibility in its investigation, including the possibility that SCE’s equipment was involved,” Edison Chief Executive Officer Pedro J. Pizarro said in a statement.

Shares of Edison fell 2.5% to $51.15 as of 3:14 p.m. in New York, the lowest since October 2020.

Edison has lost about $10 billion in market value since the Los Angeles wildfires erupted on Jan. 7 during hurricane-force Santa Ana winds. California’s utilities have started some of the state’s worst wildfires. Broken equipment on a PG&E Corp. transmission tower was found to have caused northern California’s Camp Fire in 2018, which killed 85 people and destroyed the town of Paradise.

State and county investigators asked Edison to preserve in place its transmission facilities located at the suspected start of the Eaton fire, which killed 17 people, Edison said in its filing. State regulators require utilities to file reports when its equipment is thought to have been involved with a significant wildfire. 

Property damages from the Eaton fire are estimated at $7 billion to $10 billion, Evercore ISI said in a Thursday note. The research firm said Edison has typically paid out 30% to 40% in prior fires that were blamed on its equipment.

Earlier this week, attorneys who filed suit against Edison on behalf of residents who lost homes in the Eaton fire alleged that the blaze started at the idled transmission tower that became energized during the high winds. The attorneys, led by Mikal Watts and Douglas Boxer, said their team had been able to pinpoint the fire’s exact origin point though a analysis of surveillance footage, photographs of Edison’s equipment and witness accounts. 

“In my career, I’ve worked on 22 wildfires, representing 21,000 fire survivors in six different states,” Watts said. “This is the clearest evidence that I’ve ever seen of utilities’ equipment being the start of a fire.”

Separately, Edison said in a report to regulators that the Los Angeles Fire Department has suggested that SCE’s equipment caused the Hurst Fire that burned 799 acres and was contained on Jan. 16.

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