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Los Angeles Times
21-05-2025
- Business
- Los Angeles Times
Edison executives made false statements on wildfire risks, lawsuit claims
Edison International officers and directors misled the company's investors about the effectiveness of its efforts to reduce the risk of wildfire in the months and years before the devastating Eaton fire, a shareholder lawsuit claims. The lawsuit, filed last week in U.S. District Court in Los Angeles, points to repeated statements that the utility made in federal regulatory reports that said it had reduced the risk of a catastrophic wildfire by more than 85% since 2018 by increasing equipment inspections, tree trimming and other work aimed at stopping fires. The complaint also raises doubts about news releases and other statements that Edison made soon after the start of Eaton fire, which killed 18 people and destroyed thousands of homes and businesses in Altadena. 'We take all legal matters seriously,' said Jeff Monford, a spokesman for Edison. 'We will review this lawsuit and respond through the appropriate legal channels.' The lawsuit claims that Edison's early statements on the Eaton fire — in which it detailed why it believed its equipment was not involved in the fire's start — were wrong. 'Edison obfuscated the truth by making false and misleading statements concerning its role in the fire,' the lawsuit claims. More recently, Pedro Pizarro, the chief executive of Edison International, said the leading theory for the fire's start was the reenergization of an unused, decades-old transmission line in Eaton Canyon. The investigation by state and local fire investigators into the official cause of the deadly fire is continuing. The lawsuit was filed as a derivative action in which shareholders sue a company's officers and directors on behalf of the company, claiming they had breached their fiduciary duties. It seeks financial damages from Pizarro, Chief Financial Officer Maria Rigatti and members of the company's board of directors. Money recovered would go to the company. It also directs Edison 'to take all necessary actions' to reform its corporate governance procedures, comply with all laws and protect the company and its investors 'from a recurrence of the damaging events.' The lawsuit was brought by Charlotte Bark, a shareholder of Edison International, the parent company of Southern California Edison. 'Prior to the outbreak of the Eaton Fire, the Company had a long history of not prioritizing the safety of those who lived in the areas it serviced, and paying fines as a result,' the lawsuit states. Since 2000, it says, Edison has paid financial penalties of $1.3 billion for violating utility safety regulations. The complaint points to an October regulatory report that was the focus of a Times report. In the article, state regulators criticized some of Edison's wildfire mitigation efforts, including for falling behind in inspecting transmission lines in areas at high risk of fires. The lawsuit lists the major destructive wildfires that investigators said were sparked by Edison's equipment in recent years, including the Bobcat and Silverado fires in 2020, as well as the Coastal and Fairview fires in 2022. 'The recurring wildfire incidents connected to the Company display that the Board has repeatedly failed to mitigate a risk that materially threatens Edison,' the complaint states. The lawsuit accuses Pizarro, Rigatti and the company's board of directors of 'gross mismanagement' and claims that the defendants 'unjustly enriched' themselves. 'Because the Individual Defendants failed to carry out their respective duties, the compensation they received was excessive and undeserved,' the suit states. It asks the court for an order that would require the officers and directors to pay restitution, including returning the compensation they received that was tied to how well the company performed.
Yahoo
18-05-2025
- Business
- Yahoo
Edison's safety record declined last year. Executive bonuses rose anyway
The state law that shielded Southern California Edison and other utilities from liability for wildfires sparked by their equipment came with a catch: Top utility executives would be forced to take a pay cut if their company's safety record declined. Edison's safety record did decline last year. The number of fires sparked by its equipment soared to 178, from 90 the year before and 39% above the five-year average. Serious injuries suffered by employees jumped by 56% over the average. Five contractors working on its electric system died. As a result of that performance, the utility's parent company, Edison International, cut executive bonuses awarded for the 2024 year, it told California regulators in an April 1 report. For Edison International employees, planned executive cash bonuses were cut by 5%, and executives at Southern California Edison saw their bonuses shrink by 3%, said Sergey Trakhtenberg, a compensation specialist for the company. But cash bonuses for four of Edison's top five executives actually rose last year, by as much as 17%, according to a separate March report by Edison to federal regulators. Their long-term bonuses of stock and options, which are far more valuable and not tied to safety, also rose. Of the top five executives, only Pedro Pizarro, chief executive of Edison International, saw his cash bonus decline. He received a cash bonus of 128% of his salary rather than the planned 135% because of the safety failures, the company said, for total compensation including salary of $13.8 million. The cash bonuses increased for the other top four executives despite the safety-related deductions because of how they performed on other responsibilities, said Trakhtenberg, Edison's director of total rewards. He said bonuses would have been higher were it not for safety-related reductions. 'Compensation is structured to promote safety,' Trakhtenberg said, calling it 'the main focus of the company.' Consumer advocates say the fact that bonuses increased in spite of the decline in safety highlights a flaw in AB 1054, the 2019 law that reduced the liability of for-profit utility companies like Edison for damaging wildfires ignited by their equipment. AB 1054 created a wildfire fund to pay for fire damages in an effort to ensure that utilities wouldn't be rendered insolvent by having to bear billions of dollars in damage costs. In return, the legislation said executive bonus plans for utilities should be 'structured to promote safety as a priority and to ensure public safety and utility financial stability.' 'All these supposed accountability measures that were put into the bill are turning out to be toothless,' said Mark Toney, executive director of The Utility Reform Network, a consumer advocacy group in San Francisco. 'If executives aren't feeling a significant reduction in salary when there is a significant increase in wildfire safety incidents,' Toney said, 'then the incentive is gone.' One of the executives who received an increased cash bonus was Adam Umanoff, Edison's general counsel. Umanoff was expected to get 85% of his $706,000 salary, or $600,000, as a cash bonus as his target at the year's beginning. The deduction for safety failures reduced that bonus, Trakhtenberg said. But Umanoff's performance on other goals 'was significantly above target' and thus increased his cash bonus to 101% of his salary, So despite the safety failures, Umanoff received a cash bonus of $717,000, or 19% higher than he was expected to receive. 'If you can just make it up somewhere else,' Toney said, 'the incentive is gone.' The utility recently told its investors that AB 1054 will protect it from potential liabilities of billions of dollars if its equipment is found to have sparked the Eaton fire on Jan. 7, resulting in 18 deaths and the destruction of thousands of homes and commercial buildings. The cause of the blaze, which videos captured igniting under one of Edison's transmission towers, is still under investigation. Pizarro has said the reenergization of an idle transmission line is now a leading theory of what sparked the deadly fire. The 2019 legislation was passed in a matter of weeks to bolster the financial health of the state's for-profit electric companies after the Camp fire in Butte County, which was caused by a Pacific Gas & Electric transmission line. The wildfire destroyed the town of Paradise and killed 85 people, and the damages helped push PG&E into bankruptcy. At the bill-signing ceremony, Gov. Gavin Newsom touted its language that said utilities could not access the money in a new state wildfire fund and cap their liabilities from a blaze caused by their equipment unless they tied executive compensation to their safety performance. In April, Edison filed its mandatory annual safety performance metrics report with the Public Utilities Commission as it seeks approval to raise customer electric rates by more than 10% this year. In the report, Edison said that because its safety record worsened in 2024 on certain key metrics, its executives took 'a total deduction of 18 points' on a 100-point scale used in determining bonuses. 'Safety and compliance are foundational to SCE, and events such as employee fatalities or serious injuries to the public can result in meaningful deduction or full elimination' of executive incentive compensation, the company wrote. Read more: Edison customers are paying more for fire prevention. So why are there more fires? Edison didn't explain in the report what an 18-point deduction meant to executives in actual dollar terms, another point of frustration with consumer advocates trying to determine if executive compensation plans genuinely comply with AB 1054. 'Without seeing dollar figures, it is impossible to ascertain whether a utility's incentive compensation plan is reasonable,' the Public Advocates Office at the state Public Utilities Commission wrote in a 2022 letter to wildfire safety regulators. To try to determine how much the missed safety goals actually impacted the compensation of Edison executives last year, The Times looked at a separate federal securities report Edison filed for investors known as the proxy statement. In that March report, Edison detailed how the majority of its compensation to executives is based on its profit and stock price appreciation, and not safety. Safety helps determine about 50% of the cash bonuses paid to executives each year, the report said. But more valuable are the long-term incentive bonuses, which are paid in shares of stock and stock options and are based on earnings. The Utility Reform Network, which is also known as TURN, pointed to those stock bonuses in a 2021 letter to regulators where it questioned whether Edison and the state's other two big for-profit utilities were actually tying executive compensation to safety. 'Good financial performance does not necessarily mean that the utility prioritizes safety,' TURN staff wrote in the letter. Trakhtenberg disagreed, saying the company's 'long-term incentives are focused on promoting financial stability.' A key part of that is the company's ability 'over the long term to safely deliver reliable, affordable power,' he said. Trakhtenberg noted that the state Office of Energy Infrastructure Safety had approved the company's executive compensation plan in October, saying it met the requirements of AB 1054, as well as every year since the agency was established in July 2021. The Times asked the energy safety office if it audited the utilities' compensation reports or tried to determine how much money Edison executives lost because of the safety failures. Sandy Cooney, a spokesman for the agency, said that the office had 'no statutory authority … to audit executive compensation structures.' He referred the reporter to Edison for information on how much executive compensation had actually declined in dollar amounts because of the missed safety goals. Read more: Regulators criticized Edison's wildfire safety actions months before deadly Eaton fire A committee of Edison board members determines what goals will be tied to safety, Trakhtenberg said, and whether those goals have been met. Even though five contractors died last year while working on Edison's electrical system, the committee didn't include contractor safety as a goal, according to the company's documents. And the committee said the company met its goal in protecting the public even though three people died from its equipment and there was a 27% increase in deaths and serious injuries among the public compared to the five-year average. Trakhtenberg said most of the serious injuries happened to people committing theft or vandalism, which is why the committee said the goal had been met. Edison has told regulators that if its equipment starts a catastrophic wildfire, the committee could decide to eliminate executives' cash bonuses. But the company's documents show that it hasn't eliminated or even reduced bonuses for the 2022 Fairview fire in Riverside County, which killed two people, destroyed 22 homes and burned 28,000 acres. In 2023, investigators blamed Edison's equipment for igniting the fire, saying one of its conductors came in contact with a telecommunications cable, creating sparks that fell into vegetation. Trakhtenberg said the board's compensation committee reviewed the circumstances of the fire that year and found that the company had acted 'prudently' in maintaining its equipment. The committee decided not to reduce executive bonuses for the fire, he said. In March, the Public Utilities Commission fined Edison $2.2 million for the fire, saying it had violated four safety regulations, including by failing to cooperate with investigators. Trakhtenberg said the compensation committee would reconsider its decision not to penalize executives for the deadly fire at its next meeting. TURN has repeatedly asked regulators not to approve Edison's compensation plans, detailing how its committee has 'undue discretion' in setting goals and then determining whether they have been met. But the energy safety office has approved the plans anyway. Toney said he believes the responsibility for reviewing the compensation plans and utilities' wildfire safety should be transferred back to the Public Utilities Commission, which had done the work until 2021. The energy safety office has rules that make the review process less transparent than it is at the commission, he said. 'The whole process, we feel is rigged heavily in favor of utilities,' he said. This story originally appeared in Los Angeles Times. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Associated Press
17-05-2025
- Business
- Associated Press
John Bryson, Former Edison International Chairman and CEO, Dies at 81
ROSEMEAD, Calif.--(BUSINESS WIRE)--May 17, 2025-- The entire Edison International, Southern California Edison and Trio community is deeply saddened to learn of the passing of John Bryson, who served as Edison International's chairman and CEO from 1990 to 2008. John passed away Tuesday, May 13 at age 81. He was a groundbreaking leader whose remarkable career ranged from a founding role in the environmental movement to public service as the U.S. Secretary of Commerce. This press release features multimedia. View the full release here: John Bryson was former Edison International Chairman and CEO, former U.S. Secretary of Commerce and co-founder of the Natural Resources Defense Council. 'Our industry has lost a true legend, and I have lost a mentor,' said Pedro Pizarro, president and CEO of Edison International. 'John's steady leadership during the California electricity crisis and the industry's restructuring two decades ago set a guiding model for me as we navigate a changing utility landscape.' After graduating from Stanford University and Yale Law School, John co-founded the Natural Resources Defense Council in 1970. He was one of the earliest to sound the alarm about the impacts of climate change and was a vocal advocate to advance energy efficiency, renewable energy and electric transportation. He later chaired the California State Water Resources Board (1976-79) and served as president of the California Public Utilities Commission (1979-82). John joined SCE in 1984 as senior vice president for legal and financial affairs. His first major assignment was to analyze whether the company should develop a competitive power business, newly permitted under changes in federal law, which would be independent of the utility. John strongly recommended its development. Subsequently, the company developed a series of successful cogeneration projects in California and the western United States; created a new parent company, Edison International; and formed a new subsidiary that became Edison Mission Energy. As chairman and CEO during the 1990s and early 2000s, John's background as a regulator and environmentalist benefited the company through California's utility deregulation and electricity supply crisis, while prioritizing customer and shareholder interests. John also helped clear a path for Edison's leadership role in today's clean energy transition. Under his direction, Edison Mission Energy grew from a small operation with about 300 people to a major part of Edison International's business — one that employed 1,900 people and contributed more than $500 million to the parent company's earnings. It was the sale of most of EME's international assets that enabled Edison International to return to financial health following the collapse of the independent power producers' market in 2002. SCE soon became one of the nation's leaders in supporting the growth of renewable energy. 'John worked tirelessly with state officials and other stakeholders to achieve legislative and regulatory changes in the public interest that strengthened Edison and California's entire economy,' Pizarro said. After retiring from Edison International, John later served as U.S. Secretary of Commerce under President Barack Obama from 2011 to 2012. Our most heartfelt sympathy goes out to John's wife, Louise, their four daughters and their families. He will be deeply missed. View source version on CONTACT: Media Relations: (626) 302-2255 [email protected] KEYWORD: UNITED STATES NORTH AMERICA CALIFORNIA INDUSTRY KEYWORD: UTILITIES ENERGY SOURCE: Edison International Copyright Business Wire 2025. PUB: 05/17/2025 01:30 AM/DISC: 05/17/2025 01:29 AM
Yahoo
08-05-2025
- General
- Yahoo
SoCal Edison electric tower suspected of igniting Eaton fire dismantled for investigation
One of two Southern California Edison transmission towers was dismantled and removed Wednesday as part of an investigation into whether the towers played a role in starting the deadly Eaton fire. Located on a steep hillside in Eaton Canyon, the two towers became a focus for investigators after video from a witness captured what appeared to be flames burning underneath a tower when the fire first ignited on Jan. 7. The large towers were disassembled into several parts before being flown by a Skycrane helicopter to a nearby landing zone for examination by a team of stakeholders before further disassembly, the utility company said. The transmission tower that was removed Thursday had not been used by SoCal Edison for more than 50 years, but Edison officials told the Los Angeles Times that the tower and the idle line it carried somehow became reenergized the day the fire started. In an interview with the Times, Pedro Pizarro, Edison International Chief Executive, said the reenergization of the line through a rare phenomenon known as induction is now a leading theory into what sparked the deadly wildfire. The company reported to state regulators that four lines, including the dormant Mesa-Sylmar line, saw a momentary increase of electrical current around the same time the fire began. The Eaton fire destroyed more than 9,000 homes and buildings and killed 18 people in the Altadena area. More than 40 lawsuits from over 600 residents have been filed against SoCal Edison, accusing the utility company of igniting the blaze, the Times reports. In March, L.A. County also filed a lawsuit against the utility company, seeking to recover damage costs. A report by the New York Times questioned why SoCal Edison didn't cut power to the area despite being warned about a 'major wind event' and 'critical fire danger' leading up to the inferno. The report also alleged the power lines were under strain from intensifying winds that reached 100 mph. 'There are criteria for shutting off power for distribution lines which we get and for transmission lines and the winds didn't meet those criteria,' explained David Eisenhauer, a spokesperson with SoCal Edison. Eisenhauer said the second transmission tower will be dismantled and removed on Thursday before it's taken to a warehouse in Irwindale where it will undergo further examination and testing. 'This is all part of our commitment to a thorough and transparent investigation,' Eisenhauer said. 'We're doing this in cooperation and with input from other stakeholders like L.A. County Fire, the cities of Pasadena and Sierra Madre, and plaintiffs' attorneys.' For now, the utility company said it will be focused on moving electrical equipment underground wherever possible. 'We ran every test you can imagine before we attempted to move anything,' said Marc Ferguson, SCE senior manager of Transmission Operations and Helicopter Assisted Line Organization. 'Everybody wants to know what happened, whether SCE equipment played a part or not, so we are doing our due diligence to get to the bottom of that. It's very important to us and the community to get those answers.' Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Yahoo
08-05-2025
- General
- Yahoo
Edison electric tower at center of Eaton fire investigation is dismantled and removed for testing
An idle Southern California Edison transmission tower was dismantled, removed and flown away via helicopter Wednesday so it could be tested to determine what, if any, role it played in igniting the devastating Eaton fire. The pylon overlooking Eaton Canyon has for months been the focus of investigators who are looking to determine what sparked the deadly fire on Jan. 7, after video captured the initial flames burning underneath the structure. Known as M16T1, or Tower 208, the structure has not been used by the utility company for more than 50 years, but Edison officials said it, and the idle line it carried, somehow became reenergized the day the fire began to burn. In a previous interview with The Times, Edison International Chief Executive Pedro Pizarro said the reenergization of the line, through a rare phenomenon known as induction, is now a leading theory into what sparked the inferno. On Wednesday, crews uninstalled the metal tower from a steep, now-charred hillside overlooking Eaton Canyon, where it has stood since 1971. A sky crane helicopter lifted and transported the tower in two large pieces. SCE had planned to remove the tower since last week, but rain and overcast skies forced crews, and the helicopter used to lift and carry the equipment off the hillside, to delay the work. The tower was dismantled and transported via truck to a warehouse in Irwindale, where it will be examined, photographed and tested in a laboratory setting to look for clues, said David Eisenhauer, spokesperson for Southern California Edison. In the warehouse, the tower will be tested and examined by fire investigators with Los Angeles County Fire, Southern California Edison officials and experts hired by a growing list of plaintiffs who have since sued the utility company for allegedly sparking the fire. "We're really looking for anything that will help in the investigation," Eisenhauer said. "It's a close-up examination where we look for any information." Three transmission towers sit near one another on the steep hillside, but only the idle tower was removed Wednesday. Read more: Edison to bury more than 150 miles of power lines in wake of devastating L.A. County firestorms Two weeks ago, SCE removed the idle power lines that connected to the tower and were part of the Mesa-Sylmar SCE line, which has also been idle for decades. Los Angeles County Fire officials are still investigating the fire's start and have not commented on a possible cause, but private investigators and Southern California Edison officials have focused their attention on the canyon transmission towers. The utility company has also disclosed to state regulators that it found unusual activity on its equipment at about the same time the fire was believed to have started. The idle transmission tower at the center of the Eaton fire investigation is carried away by helicopter on Wednesday. (Myung J. Chun / Los Angeles Times) The company reported to state regulators that four lines, including the dormant Mesa-Sylmar line, saw a momentary increase of electrical current at about the same time the fire began. The incident occurred after the company detected a fault on its Eagle Rock-Gould line, which connects to the Gould substation in La Cañada Flintridge, roughly five circuit miles from the suspected ignition point of the fire. On Jan. 19, Edison crews also briefly reenergized the transmission lines over Eaton Canyon and "observed a small flash of white light upon each re-energization." The flashes occurred on equipment that carry the Mesa-Vincent and Goodrich-Gould active lines, Edison officials said in a letter to regulators. Flashes were also seen on the Mesa-Sylmar line, which was not connected to a substation. Some attorneys suing Edison have also alleged that the idle tower, 208, was improperly grounded and posed a risk, pointing to a grounding wire that appeared to have been exposed on the hillside. The grounding line is meant to be connected to the tower and buried deep in the ground, but photos submitted in court showed about 4 feet of the wire protruding from the steep hillside, under the tower. Read more: Secret changes Edison imposed after Eaton fire remain shrouded in mystery Just weeks after the fire ignited, SCE updated an internal manual, detailing how crews should ground idle transmission towers — like Tower 208 — from now on. SCE officials said it was the only change made to the large, detailed manual after the Jan. 7 fire. Edison at first declined to disclose what changes were made to the manual. A spokesperson said the changes were to clarify language in its grounding policy. A helicopter gets in position over an Altadena hillside to remove a transmission tower. The tower and the idle line it carried somehow became reenergized the day the Eaton fire started. (Myung J. Chun / Los Angeles Times) The company later shared with The Times the changes made to its idle tower grounding policies, showing the new grounding instructions provided new specifications for equipment, including the type of grounding wire and number of bolts to be used, depending on the type of structure. The previous version of the manual did not provide that type of specificity. Rajdeep Roy, vice president of transmission operations for Edison, told The Times that, before the changes, engineers determined the grounding procedures on a case-by-case basis, taking equipment, terrain and surroundings into account. Edison officials said a second tower, which had also been connected to the Mesa-Sylmar line, was scheduled to be removed and taken to the Irwindale warehouse later this week, so it could also be inspected and tested. That tower, Eisenhauer said, was near the Gould substation, where the fault had been detected by the utility company. Sign up for Essential California for news, features and recommendations from the L.A. Times and beyond in your inbox six days a week. This story originally appeared in Los Angeles Times.
