Alaska: Electric Utilities Wildfire Liability Immunity Bill Set for Hearings in House Committee on Judiciary

HB 227, which relates to broad liability immunity for an electric utility for contact between vegetation located outside the utilities’ property rights and the utilities’ facilities, will be heard in the House Committee on Judiciary on March 6 as an “invited guests only” hearing and then on March 8 at a public hearing. At the committee hearing, NAMIC will provide oral testimony in opposition to the legislation and in support of industry compromise amendments. The bill previously passed out of the House Energy Committee, which is chaired by the bill sponsor.

The legislation states that “utility offering electrical service to the public for compensation … may not be held liable for costs, property damage, death, or personal injury resulting from contact between vegetation and the utility’s facilities if the vegetation is located or originated outside the boundaries of the utility’s real property, lease, permit, easement, or right-of-way.” [Emphasis added]

The legislation would create a moral hazard by granting electrical utilities immunity for certain types of wildfires and would seriously impact an insurer’s ability to pursue legal subrogation against an at-fault electrical utility whose negligence may be the direct and proximate cause of a wildfire that destroys private property.

NAMIC has also provided a copy of its prior written testimony to the committee stating that “the proposed legislation is really nothing more than a ‘cost-shifting’ of liability from electrical utilities to homeowners, citizens, and other businesses in the state.” In NAMIC’s outreach, it specifically asked committee members to consider the association’s proposed amendments and help facilitate negotiations with the proponents of the bill, so that a compromise may be reached that addresses their liability exposure concerns without sacrificing consumer protections against wildfires.