Pacific Gas and Electric
PG&E Camp Fire Liability
Estimated impact: $13.5B
PG&E's failure to maintain aging transmission infrastructure caused the Camp Fire, the deadliest and most destructive wildfire in California history. The fire killed 85 people and destroyed 18,804 structures. PG&E had deferred maintenance and vegetation management for years despite knowing its equipment posed wildfire risks.
Decision context
Whether to invest in replacing aging transmission lines and aggressive vegetation management in high-risk wildfire zones, or to continue deferring maintenance to reduce operating costs.
Biases present in the decision
Toxic combinations
- Status Quo Lock
Reference class base rates
Across all 146 curated case studies in our library:
Lessons learned
- Status quo bias in infrastructure maintenance means deferred spending accumulates as hidden risk until catastrophic failure.
- Cognitive misering in risk assessments leads utilities to treat wildfire risk as a low-probability event rather than updating for climate change.
- Loss aversion around short-term earnings prevents the capital investment needed to prevent long-term catastrophic losses.
Source: Cal Fire Investigation Report on Camp Fire (2019); PG&E Chapter 11 filing (2019) (Case Study)
See what we'd flag in your next strategic memo.
Upload a strategic memo or board deck. Get the same bias audit you just saw for Pacific Gas and Electric, on your own high-stakes call, in under 60 seconds.
Or leave your email, we'll run a strategic memo of your choosing and send the readout within a business day.
Ready to audit your own memo right now? Create a free account →