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A skilful helicopter pilot and crew are water bombing fires
© Andrew Merry / Getty Images

Summary

Wildfire is increasingly a nationwide risk across the United States, not a West Coast exception. Statistics from the National Interagency Fire Center show that, between 2020 and 2025, the United States averaged 62,000 wildfires per year with roughly 7.3 million acres burned annually. At the same time, the White House accelerated the regulatory pace by issuing an Executive Order on Wildfire Prevention and Response. Expectations are shifting from limited actions in historically affected areas to a more systematic and pro-active approach to wildfire risk.

That shift was clear at a recent North American Electric Reliability Corporation (NERC)-led workshop in Salt Lake City, Utah. Regulators, utilities, and researchers discussed how wildfire hazard conditions and resulting risk are affecting the reliability of the power grid across the United States. Wildfire affects power systems in two directions at once: the grid is exposed to fire, smoke, and heat, while equipment faults are often also ignition sources for new fires.

One takeaway stood out: with wildfire hazard intensifying and the power grid expanding, spatial intelligence is a key instrument in the toolbox of wildfire risk mitigation. Without granular, risk-based prioritisation to identify where risk is building across assets and corridors, wildfire mitigation in the power sector will remain inefficient, costly, and insufficient.

Firefighter fighting a brush fire

What are the lessons from the Los Angeles fires?

According to Munich Re estimates, the January 2025 Los Angeles wildfires caused around US$ 53bn in overall losses and roughly US$ 40bn in insured losses (inflation-adjusted). A hazardous combination of drought and strong winter winds created ideal wildfire conditions.
Thirty people lost their lives, thousands their homes. It became the most expensive wildfire disaster on record.

While California is well experienced with wildfire, there is an increasing risk that a major wildfire shock arrives in a region with far less experience managing wildfire at scale. In such regions, a lack of preparedness and knowledge around wildfires can have ever-larger consequences – in particular in critical infrastructure such as the power grid. As societies electrify transport, heating and industry, as well as add new capabilities such as AI, any disruption to the grid has serious socio-economic impacts.

Image: Losses from wildfire in the United States 2000-2025, Losses inflation-adjusted via country-specific consumer price index.
Source: NatCatSERVICE, January 2026. Munich Re's NatCatSERVICE is a global database containing loss data from 1980 onward for all types of natural disasters, excluding drought and heatwaves

Is wildfire risk still a California story?

California remains the United States' best-known wildfire hotspot, and the heaviest hazard and loss burden is still concentrated in the West. Yet recent events make clear that wildfire is not a regional niche. Oregon's 2020 fire season showed how prolonged heat, drought, and strong winds can drive large, fast-moving fires across a broad footprint. Colorado's Marshall Fire (2021) demonstrated that wind-driven grassland blazes can produce severe losses within hours, with public reporting linking ignition to electrical infrastructure.

These examples show that wildfire can no longer be dismissed as a Western utilities problem: risk materialises wherever elevated hazard conditions intersect with dense assets, critical corridors, and potential ignition sources. As wildfire risk becomes more relevant across regions, it is taking centre stage in regulation, resilience planning, and insurance.

Image: Wildfire HD Edition map overlay in Munich Re’s Location Risk Intelligence. Wildfire HD Edition provides high-resolution wildfire hazard assessments and a Wildfire HD Risk Index (0–100) designed to support decision-making by reflecting normalised wildfire severity and the likelihood of property loss in hazard zones. Wildfire HD covers the entire continental United States plus Alaska, Australia, Greece, and the core risk regions of Canada (Alberta and British Columbia).
Source: Munich Re’s Location Risk Intelligence.

Table I:
States with the highest share of analysed power lines in High, Very High, and Extreme Wildfire HD Risk Index classes

ca. 25% of power lines in the state fall into High or above Wildfire HD Risk Index classes
ca. 12% of the power grid falls into High or above Wildfire HD Risk Index classes
ca. 11% of the power grid falls into High or above Wildfire HD Risk Index classes

What are the implications for the power sector?

Following the devastating 2025 wildfires, the President of the United States asked the Department of Energy, the Federal Energy Regulatory Commission and NERC to develop new standards and best practices for wildfire mitigation in the power sector. The resulting report, due in May 2026, will directly influence how states and utilities are expected to manage wildfire risk going forward. Two themes dominated the workshop discussions:

  1. Risk-based prioritisation: Utilities cannot mitigate everything at once. Regulators increasingly expect utilities to identify the small share of assets that drive a disproportionate share of wildfire risk, and to focus investment there first.
  2. Granular spatial intelligence: Coarse, historic fire maps are no longer sufficient. Asset-level decisions require forward-looking, high-resolution hazard insight that reflects fire-weather conditions, vegetation and land use, and that can be linked to exposure along specific assets and corridors.

This is where the gap becomes visible. Many utilities, particularly outside California and among mid-sized operators, still rely on relatively coarse spatial data. As a result, capital-intensive mitigation programmes are primarily reactive, or may be difficult to justify.

David Fischer
© Stiftung Mercator
In the power sector, wildfire is a two-way risk: the grid is exposed to fire, smoke, and heat, and it can also act as an ignition source through equipment faults. Our analysis shows the exposure is highly concentrated – around 3% of US power lines fall into high or above wildfire risk. That concentration is the opportunity: it allows utilities and states to focus scarce resources and capital and to prioritise mitigation where it reduces risk the most.
David Fischer
CPO Risk Management Partners, a unit of Munich Re

How concentrated is wildfire exposure nationwide?

At the workshop, Risk Management Partners presented a nationwide analysis of wildfire exposure across the US grid footprint, based on the recently expanded Wildfire HD Edition and a database covering approximately 1.2 million km (c. 746,000 miles) of power lines – predominantly transmission infrastructure (typically >35 kV). Rather than focusing on isolated hotspots, the analysis provided a system-wide view that:

  • identified highly exposed corridors along linear infrastructure,
  • highlighted exposure concentrations across administrative regions, and
  • enabled consistent comparison across utilities and states.

One key insight resonated strongly with regulators: while wildfire exposure in the US power grid is highly concentrated, it is especially prevalent around power lines that serve significant population and economic concentrations. A relatively small percentage of lines, substations, and regions account for a large share of potential wildfire losses. Without high-resolution modelling, these priorities remain invisible.

As a consequence, usage of spatial intelligence featured heavily in the workshop. Tools such as Wildfire HD help pinpoint where elevated hazard aligns with critical assets, supporting defensible prioritisation of capital-intensive measures such as vegetation management and undergrounding. They also help avoid creating new exposure by informing routing and siting decisions during grid expansion planning.

Table II:
Share of analysed power lines by Wildfire HD Risk Index band

Extreme 0.4%
Very high 1%
High 1.6%
Medium 8%
Rest 90%
Source: US power grid on Wildfire HD analysis by Munich Re, Risk Management Partners (based on ~1.2 million km / ~746k miles of line data, predominantly transmission >35 kV; distribution coverage partial).
Image: US power grid on Wildfire HD (based on ~1.2 million km / ~746k miles of line data, predominantly transmission >35 kV; distribution coverage partial).
Source: Munich Re, Risk Management Partners.

Conclusion

Wildfire risk is growing, and so are the consequences for the power sector, because reliability, public safety, liability, and insurance affordability are increasingly linked. More than ever, the challenge is to mitigate wildfire risk in a way that is targeted, defensible, and measurable. For most utilities, wildfire risk mitigation starts with three specific actions before the next season: 

 Key steps for wildfire risk mitigation

Step 1 Establish an asset-level baseline by overlaying transmission and distribution data with high-resolution wildfire hazard insight. Identify the corridors and connection points that drive exposure.
Step 2 Translate that visibility into a prioritised mitigation plan focused on the small share of assets where investment has the highest risk-reduction value.
Step 3 Build the evidence trail regulators increasingly expect: a clear logic that links where you acted, why you acted there first, and how that action relates to quantified exposure and risk.
The question is not “Do we have a wildfire programme?” It is: “Can we pinpoint the specific line segments, corridors, and substations that drive our exposure, and can we show our mitigation investments are reducing risk where it matters most?”

Frequently Asked Questions (FAQ)

Wildfire HD Edition provides high-resolution wildfire hazard insight for the continental United States and Alaska. It also covers the core wildfire risk regions in Canada (Alberta and British Columbia), as well as the entire countries of Australia and Greece. This matters for utilities because it supports a consistent baseline view across multi-state and regional footprints, not only traditional wildfire hotspots.
The Wildfire HD Risk Index is designed to support decision-making by reflecting normalised wildfire severity and the likelihood of wildfire-related property loss in hazard zones. The index ranges from 0 to 100 and is grouped into 16 classes, enabling more precise differentiation between areas that may look similar on coarse maps but behave differently under real fire-weather conditions.
Historic fire maps show where fires occurred. They are useful context, but they are not enough for forward-looking, asset-level decisions. Wildfire HD Edition is intended to help answer a different question: where wildfire hazard is elevated based on high-resolution hazard drivers and calibration, and where that matters because assets and values are exposed. For grid operators, that distinction is critical because mitigation budgets and operational measures must be prioritised before the next incident.
Yes. The workshop use case is built around overlaying transmission and distribution line datasets to identify high-index corridors, segments, and critical connection points (such as substations). That overlay approach is what turns wildfire hazard intelligence into a practical prioritisation tool for engineering, operations, and resilience planning.
A risk-based approach starts by identifying the small share of assets that drive disproportionate exposure, then aligning mitigation to those priorities. In practice, this supports targeted decisions such as where vegetation management should be intensified first, where resilience upgrades are most defensible, and where operational practices need clearer thresholds – all tied back to an evidence-based view of exposure.
Regulators are increasingly focused on whether mitigation is measurable and defensible, not merely whether a programme exists. Asset-level spatial intelligence helps create a traceable decision trail: where you acted, why you acted there first, and how actions map back to quantified exposure and risk. That logic is typically easier to defend to boards, regulators, and risk-transfer stakeholders than blanket measures.
Static layers support planning and prioritisation. Event-based views help connect planning to operational reality. Live event awareness can support preparedness when a wildfire occurs near selected assets, while historic event analysis can support back-testing, lessons learned, and documentation – particularly when explaining why specific investments or operational decisions were made.

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