How grids are navigating rising wildfire risk

Recent wildfires worldwide have renewed attention on how wildfire risk intersects with the energy sector, particularly electricity grids. Grids, especially where they traverse remote or sparsely serviced areas, are exposed to wildfire conditions – but grid infrastructure itself also poses some risks. With nearly 25 million km of electricity lines to be built over the next decade under today’s policy settings, wildfire risks raise important questions about where to build this new infrastructure and how utilities can operate safely and reliably in fire-prone areas. These challenges are intensifying as wildfire conditions become more common in some regions and economies grow increasingly reliant on electricity.

This commentary presents the first comprehensive IEA analysis on wildfires and the electricity sector, including detailed global maps showing where grids intersect with wildfire zones and where wildfires are already disrupting electricity supply. It also examines their implications for grid expansion and operation ahead of the IEA’s forthcoming Global Observatory on Energy Sector Resilience.

Large and severe wildfires have recently dominated headlines. Despite a global decline in overall burned area – largely due to changes in agricultural activity and practices – the number and frequency of intense wildfires has more than doubled over the past two decades. These fires typically strike during longer heat seasons and periods of low precipitation, often after rains boost vegetation growth. In 2025,  Europe experienced its worst year on record for wildfires – and 2026 may yet surpass it, with overall losses already projected to exceed EUR 3 billion. Since 2014, economic losses from wildfires have more than tripled in advanced economies – growing by over 11% per year, while insured losses have grown by around 12% annually, led by the United States, Europe and Australia. Beyond loss of life and property damage, wildfires can have enduring impacts on local economies, health, biodiversity and climate implications due to smoke, environmental degradation and emissions.

Importantly, wildfire conditions also have implications for the operation of energy infrastructure. A new IEA database tracking around 3 000 energy supply disruptions caused by natural hazards since 2022 registers around 180 reports of wildfire-related power cuts or outages, causing close to 15 million customer disruptions. Their causes vary and many result from the de-energisation of grid sections when wildfires are endangering power lines, poles and other network equipment.

While still accounting for a small share of incidents, grids have been implicated in starting a number of wildfires in recent years. In the United States – where available data on sources of ignition is most complete – the escape of controlled burns, natural causes, arson, and equipment and vehicles are among the leading causes. Since the start of this century, energy infrastructure has accounted for around 4% of United States wildfires with a known cause, on average, although that share is rising. Similarly, in Victoria, Australia, wildfires represent between 1% and 2% of grid-related safety incidents reported.

Where electricity grids are found to start wildfires, the causes vary. Most commonly, in dry and windy conditions, overgrown vegetation comes into contact with live equipment. Fires can also be ignited by faulty equipment or via sparks from power lines clashing as they sag in the heat and sway in the wind – conditions that also promote fire spread. In Australia and Greece, utilities have been fined and found liable in connection with wildfires, and recent investigations identified utility equipment as the cause of the 2025 Eaton Fire in the United States.

Wildfire conditions can lead to power cuts even before fires start, as operators pre-emptively de-energise sections of the grid when strong winds, heat and dry conditions create an imminent risk. In 2025, across the Western Interconnection power grid in North America, 21 such events affected over 600 000 customers. De-energising is also common during active fires to protect firefighters and limit operation in unstable conditions. Sudden de-energising, however, can create wider challenges for grid management. In Argentina in 2023, the de-energisation of power lines destabilised the electricity system and triggered safety shutdowns at power plants during a period of high cooling demand, temporarily leaving around 20 million people without power. A growing share of solar PV in the electricity mix can add further complexity: smoke from Canadian wildfires was estimated to reduce solar PV output by up to 40% in neighbouring US states, creating variability that can be difficult for grid operators to anticipate and manage.

New IEA analysis maps where the world’s electricity infrastructure intersects with areas prone to wildfires. Globally, 22% of electricity grids pass through areas at risk of fire on average at least once every ten years and around 5% within every two years. With 65% of its grid infrastructure above ground, South America has the largest share, while North America has the greatest total line length in wildfire-prone areas. In these areas, wildfire risk becomes a central consideration for utilities.

Grids near inhabited areas imply higher potential consequences in case of wildfires, albeit also with better access to firefighting capabilities. Over 20% of the infrastructure interfacing with wildfire risk globally also lies within 10 km of urban centres, and more than two thirds within 50 km. Remote, difficult-to-access lines can pose challenges for repair, such as in Australia, where fires in Victoria in January 2026 damaged around 900 km of power lines, including in remote areas that were inaccessible during several weeks.

Where electricity must be supplied across fire-prone areas, policymakers, regulators, utilities and industry can work together to manage risks. Actions range from policy measures, such as reporting and preparedness requirements, to changes in utility operations and equipment standards, and hardening – installing more robust network equipment. As wildfire risks spread, responses are moving beyond individual measures towards more comprehensive frameworks, alongside evolving approaches to recovering the costs of mitigation investments and exceptional reconstruction.

Some interventions are already widespread. More than half of above-ground power lines in wildfire-prone areas are in countries where obligations or standards for vegetation management exist, at least for higher voltage levels. For example, the NERC standard requires vegetation clearance, annual inspections and incident reporting across Canada, the United States and parts of Mexico. A growing number of jurisdictions around the world – including Victoria in Australia and California and Texas in the United States – also require comprehensive wildfire management plans. In Brazil, a more than threefold increase in wildfires in since 2020, prompted stricter monitoring and penalties, while Greece has strengthened investigations into the cause of fires, potentially increasing scrutiny of cases in which grid infrastructure may have contributed to ignition.

Ideally, utilities are enabled to proactively adopt tailored strategies, thereby reducing the need for policymakers and regulators to intervene with prescriptive regulation and penalties. Routing new infrastructure away from high-risk areas where possible, directly reduces exposure. Where this is not feasible, utilities are increasingly adapting their construction and operating practices, including larger clearance under conductors, covering conductors and encapsulated components. Utilities also deploy fire-resistant poles and fast-fault detection and protection systems, including enhanced powerline safety settings and rapid earth-fault current limiters. More costly measures, such as network redundancy or undergrounding lines may be justified where potential losses are particularly high, as demonstrated by targeted undergrounding programmes in California, or where they offer wider benefits, e.g., for tourism or social acceptance in Greece.

Utilities can also contribute to wider resilience and wildfire management, particularly as network infrastructure and workforces extend across remote and difficult-to-access areas. State Grid in China, for example, uses satellites and drones to monitor more than 100 000 km² for wildfires. Eskom in South Africa incorporates fire breaks into its vegetation management routines, while Portugal's transmission system operator REN works with landowners on managing abandoned land and on reforestation using native, fire-resistant plants.

How resilience measures are financed is becoming an increasingly important question, as regulators seek to strengthen resilience while limiting the impact on consumers. Several factors make it difficult to assess the trade-offs across assets, measures, risk profiles and preferences. Utilities may be able to incorporate some types of resilience measures into their regular plans and budgets, even if they compete with other priorities. Other measures may require regulatory approval and increase bills for consumers. Upfront hardening can be more difficult to justify than repairing damaged infrastructure – particularly when it requires explicit approval. Operational measures may be cost-effective but less attractive for utilities.

At the same time, existing regulatory frameworks may not sufficiently capture the benefits of resilience, particularly as reliability metrics, which reward utilities for limiting the frequency and duration of outages, often exclude extreme weather events as force majeure. Consequently, regulators are beginning to recognise resilience expenditure more explicitly: Australia, for example, is developing guidelines, including for bushfire resilience, while the United Kingdom is pursuing a similar process with a focus on storms. Some jurisdictions are also providing additional funding outside utilities’ regular budgets.

Liability frameworks further shape how wildfire risks and costs are distributed among utilities, consumers and governments. In California, utilities face particularly strict accountability for wildfire damages and losses which has translated into growing credit risks for exposed utilities and rising utility bills. In 2025, wildfire-related costs accounted for up to USD 41 per month in average residential bills in the state, of which up to one quarter is linked to liability costs. Some utilities may therefore partially rely on pre-emptive de-energisation during extreme fire conditions, reducing ignition and liability risks at the expense of disruptions to a number of consumers. In contrast, utilities in several Australian states must compensate affected customers for outages, including those linked to bushfires and other natural hazards. Insurance schemes and wildfire funds such as those in California  and the ad-hoc relief fund established in Chile can absorb some risk, but do not cover the full economic consequences of wildfires.

Effective wildfire-risk management will require a combination of administrative measures, targeted investment, operational changes and cooperation between utilities and authorities. Policymakers can support these efforts through clear standards, risk mapping, appropriate accountability frameworks and coordination across agencies and jurisdictions – such as with the G7 Wildfire Charter or European coordination for firefighting. The IEA is contributing by expanding its publicly available data on energy disruptions and resilience measures through its forthcoming Global Observatory for Energy Sector Resilience, while convening regular dialogue among regulators, policymakers, energy companies, insurers and financiers to shape a broader agenda for energy sector resilience.

This commentary benefited from the contributions of Ethan Burkley (former Energy Analyst), Lena Brun (former Analyst Intern), Insa Handschuh (Climate Resilience and Energy Analyst), Martí Serra i Oliveras (Energy Analyst), and Hugh Hopewell (Senior Energy Analyst).

To get in touch about the data and analysis in this commentary, please write to resilience@iea.org.