In brief:
California has had relatively few major wildfires since the January 2025 Los Angeles fires, but unmet priorities could spell disaster at any time. A new report by Stanford’s Climate and Energy Policy Program (CEPP) provides an overview of data and context to help policymakers understand the scope of wildfire’s impacts – from destroyed homes to higher electric bills – and make informed decisions about prevention and preparation measures, such as prescribed burns and home hardening.
Released Nov. 4, the system-level report also includes an assessment of wildfire prevention and response spending. It comes as the federal government reorganizes its wildland fire workforce and California awaits the inauguration of a new governor.
“The challenge with all natural disaster preparedness is that memories of catastrophes, and with them, the willingness to do things to prevent them, fade quickly,” the report’s authors write.
Below, CEPP Director Michael Wara and CEPP Research Director Michael Mastrandrea discuss emerging trends, policy insights, and the urgency for action highlighted by the report they coauthored with other CEPP researchers.
Despite having relatively few major wildfires in recent months, California remains far from true wildfire resilience.
Although the total number of acres burned statewide in 2025 dropped by more than half from the previous year, the number of structures destroyed by wildfire increased 10-fold. That’s largely because the Los Angeles fires ripped through densely populated areas. “When it feels like a quiet year, it can be easy to think, oh, the pressure’s off, right?” Wara said. “But we have enough experience here in California to realize that that’s not the case unless you have truly changed the risks.” Meanwhile, he said, state policies governing who pays the costs of wildfire have led to electric utilities spending huge sums to reduce the chance their infrastructure sparks fires. This amount dwarfs what is spent on landscape resilience and home hardening statewide. Roughly one in four structures in California sit in or on the edge of a fire hazard zone, and millions of homes need upgrades. The report highlights that “smart” changes, such as home hardening, community preparation, and landscape fuels management, could turn a “category 5” wildfire into a “category 2” that well-trained fire services can better manage.
Costs reach people far from fires. The most effective fix is fewer losses.
Wildfire-related costs passed on from utilities to ratepayers grew from $488 million in 2019 to nearly $9 billion in 2024. From 2020 to 2026, average monthly residential electric bills rose 66% for Pacific Gas and Electric customers, 88% for Southern California Edison customers, and 46% for San Diego Gas & Electric customers, compared with 26% consumer price inflation. In great part because of wildfire risk, homeowner insurance premiums rose 84% over the same period (45% after inflation), and the FAIR Plan, the state’s insurer of last resort, went from covering 2% of single-family homes to about 5%, covering over $750 billion in property value.
“ The only way, in our minds, that you actually reduce the costs or the pressures on bills and on insurance premiums is to have fewer losses in the future,” Mastrandrea said. “And the only way to do that is really to invest in community protections, landscape work, and other safety efforts.”
California is making real progress, but there is significant unfinished business for the next governor.
On the one hand, lawmakers signed bills this year to support safer communities and more resilient landscapes, including creating a home hardening loan program, creating standards for smoke damage coverage, and extending prescribed fire liability protections. On the other hand, a proposal to overhaul utility wildfire liability died at the end of the legislative session, and agreement on long-term funding sources for scaling landscape and community investments has not yet been reached. Also, prescribed burning fell short of state goals. “A comprehensive plan for targeting and scaling risk reduction to the places that would better protect communities from wildfire … would have large benefits for community safety, housing affordability, and the broader economic wellbeing of California,” the report’s authors write.
Authors of the report also include Mareldi Ahumada-Paras, Thomas Butler, Bree Evans, Liam Gunn, Samuel Hudgens, Qiao Kang, Debbie Luong, Eric Macomber, Nam Nguyen, Alia Schoen, Lane Smith, and Jessica Yu.
Wara is also the Melvin and Joan Lane Senior Fellow at the Stanford Woods Institute for the Environment and senior director of policy at the Stanford Doerr School of Sustainability Accelerator .
Mastrandrea is also a senior research scholar at the Stanford Woods Institute for the Environment, and director of policy at the Stanford Doerr School of Sustainability Accelerator.
The report was funded by the Gordon and Betty Moore Foundation and the Resources Legacy Fund.
Stanford’s Climate and Energy Policy Program (CEPP) operates at the interface of policy analysis, academic research and education, and stakeholder engagement. CEPP is a program of the Woods Institute for the Environment at the Stanford Doerr School of Sustainability , in partnership with the Environmental and Natural Resources Law and Policy Program at the Stanford Law School . CEPP researchers are working with policymakers and communities to develop initiatives to find and implement the most effective measures to address the causes and impacts of catastrophic wildfires. Learn more