This podcast, based on GEP's whitepaper, Undergrounding vs. PSPS: The Cost Tradeoff Decision for a Wildfire-Resilient Grid, explains why utilities are shifting from repeated shutoffs to permanent line burial and what it takes to get that spending approved.
Circuits with the highest wildfire risk are easy to identify from maps and outage history. Getting the spending approved is a different matter. Regulators want to see PSPS avoided costs weighed against falling per-mile prices, with a measurable drop in risk attached to the number. Without that case built out circuit by circuit, regulators can reject or scale back the funding request, even when the underlying engineering plan is solid.
A circuit-level economic case makes the difference. It weighs recurring PSPS losses against a fixed, one-time undergrounding cost for that specific segment, giving regulators a direct dollar comparison. A blanket capital request skips that comparison, asking for approval without showing which circuits benefit or by how much.
What's Inside
- Why PSPS costs keep climbing for ratepayers
- How falling per-mile costs are changing the math
- What utilities must prove to win rate case approval
Grid resilience isn't optional anymore.
Listen to the podcast now.
Frequently Asked Questions
A PSPS is a deliberate outage utilities trigger during high-risk conditions to keep power lines from sparking wildfires. It remains the industry's most visible near-term tool for preventing utility-ignited fires, but the cost lands hard on customers and local economies. A single one-hour outage can cost a large commercial or industrial customer roughly $82,000, and PG&E's October 2019 shutoff alone cost the California economy an estimated $2 billion.
Undergrounding asks for more money upfront, but that spend is fixed, and it comes with a real drop in risk attached to it. PG&E's 2023 rate case authorized 1,230 miles of distribution undergrounding, which raised the typical residential bill by about $32.62 a month while cutting wildfire risk on those segments by nearly 98%. PSPS, by contrast, keeps generating losses every time it's triggered, with no cap on how often that happens.
Distribution undergrounding has gotten cheaper as utilities standardize designs and lock in strategic sourcing, bringing PG&E's cost down from over $4 million to $3.1 million per mile. Transmission is a different story. Underground transmission cable typically runs four to five times the cost of overhead lines, largely because of terrain, permitting delays, and routing constraints that don't ease up just because delivery models improve elsewhere in the grid.