SF5106

Purpose

Explain and authorize how electric utilities in Minnesota plan for and pay for wildfire risk mitigation, outline how these plans are approved and updated, and set rules for liability related to wildfires tied to utility facilities. The bill aims to reduce wildfire risk by requiring formal wildfire mitigation plans, enabling cost recovery for prudent wildfire-related investments, and clarifying liability standards.

Key Definitions

• Hazardous vegetation: plants that are dry, diseased, or dead; near power lines; could touch lines in dry, windy conditions; may cause faults or wildfires.
• Qualified utility: includes electric public utilities, certain electric cooperatives, municipal utilities, and related electric providers.
• Wildfire mitigation plan: a plan describing the utility’s service area, risk areas, vegetation management, plans to operate and inspect infrastructure, and other risk-reduction measures.
• Wildfire: an unplanned, unwanted fire that can damage resources or threaten lives and safety.

Main Provisions

• Establishes wildfire mitigation plans as a required tool for reducing wildfire risk from electric facilities.
• Requires plan contents, including:
  • Service territory and high-risk right-of-way areas.
  • Procedures for inspecting and operating transmission and distribution infrastructure.
  • Vegetation management plans and schedules.
  • Coordination with other utilities and shared facilities.
  • Upgrades or replacements to reduce wildfire risk.
  • Plans for safe public power shutoffs (when used), including procedures for deenergizing lines, reclosers, notice to customers, and communications with authorities and other utilities.
  • Public safety communications and coordination with wildfire protection plans.
  • Plans to restore electrical systems after wildfires and an estimate of implementation costs.
• Electric utilities must submit wildfire mitigation plans to the Minnesota Public Utilities Commission (the Commission) for approval, modification, or rejection within 90 days.
• Approved plans may preempt local land-use plans or ordinances that would hinder implementation.
• Utilities must publish wildfire mitigation plans on their websites within 30 days after approval.
• Plans must be updated and resubmitted for approval every four years; if a utility reports annually, the annual report must also be published on its website.
• Special submission requirements apply to generation and transmission cooperatives, municipal agencies, and other coordinated entities, including plan approval by governing authorities, public disclosure, annual compliance reporting, and biannual plan updates.

Cost Recovery and Rate Impacts

• The Commission must approve the recovery of all prudently incurred investments and expenditures to implement an approved wildfire mitigation plan in a rate change proceeding (under the rate framework in Minnesota law).
• The bill creates a path for utilities to recover reasonable wildfire-related costs from customers, if those costs meet prudence standards.

Civil Liability and Damages

• Strict liability for wildfire damages is not imposed on qualified utilities. A qualified utility is not strictly liable for wildfire-caused damages.
• General liability: a person who negligently, recklessly, or intentionally causes or spreads a wildfire can be held responsible for suppression costs and damages.
• Costs to suppress a wildfire can be recovered by the party who incurs them or by property owners who suffer damages.
• Substantial compliance defense: a qualified utility is not liable if it substantially complied with the wildfire mitigation plan, including proper vegetation management and necessary upgrades, and if access to rights-of-way was denied or delayed, contributing to damages.
• Damages to real property: the award is the lesser of the cost to restore property to its pre-wildfire condition or the difference between pre-wildfire and post-wildfire fair market value.
• If access to rights-of-way (state, federal, or Tribal lands) is denied or delayed, and the denial or delay caused damages, that denial/delay can be a proximate cause of the damages.

Compliance, Updates, and Reporting

• Utilities must periodically update wildfire mitigation plans and resubmit them for approval (every four years for most utilities; some entities have two-year update requirements for certain processes).
• Plans must be published and filed as required, with compliance reports submitted to the governing authorities and the Commission.

Preemption and Public Accountability

• Approved wildfire mitigation plans have a preemption effect, potentially superseding local land-use rules that would impede plan implementation.
• Plans and compliance information must be publicly accessible (website postings, filings with the Commission, and annual reporting).

Implementation Timeline and Scope

• 90-day timeline for the Commission to approve, modify, or reject submitted wildfire mitigation plans.
• Plans and updates occur on a four-year cycle (with some two-year update requirements for specific entities or processes) and may involve annual reporting.
• Immediate publication on utility websites after plan approval.
• Ongoing coordination with state wildfire protection or mitigation efforts and with other qualified utilities.

Who Is Affected

• Electric public utilities, generation and transmission cooperatives, municipal power agencies, power districts, cooperative electric associations, and municipal utilities that operate electric facilities.

Relevant terms section will follow with key terms and synonyms.

---

Relevant Terms - wildfire mitigation plan - qualified utility - hazardous vegetation - public safety power shutoff - deenergize - recloser - right-of-way - Commission (Minnesota Public Utilities Commission) - cost recovery - prudently incurred investments - strict liability prohibition - liability for suppression costs - substantial compliance - local land use preemption - vegetation management - vegetation management plan - outage notifications and communications - annual reporting - four-year plan update - two-year plan update - wildfire damages - fair market value (FMV) - restoration costs - public disclosures and website publication