LOS ANGELES -- One of the largest wildfires in California’s history has spread to San Francisco Public Utilities Commission’s water facilities, but it won’t affect water -- or credit -- quality, Moody’s Investors Service said.
The fire has caused enormous damage, burning through hundreds of square miles and reaching SFPUC’s watershed and primary water storage facility, the Hetch Hetchy reservoir.
“Even if the fire worsens significantly, it will only cause a modest rise in water treatment costs and won’t affect the credit quality of the Commission’s water revenue bonds,” analysts said in a report released Aug. 30.
Moody’s rates the utility’s revenue bonds at Aa3, with a stable outlook.
The worst that could happen is that major levels of falling ash could contaminate the Hetch Hetchy reservoir, Moody’s said. But before the fire started, however, the city was already in the process of transferring water from the reservoir to other reservoirs, strengthening its already solid level of downstream water storage.
The utility has a four-month water supply stored in other facilities, which are located well beyond the fire zone. The supply provides SFPUC with sufficient time to implement emergency water supply agreements it has with other water utilities, though this is unlikely.
“The most likely effect from the fire is that ash contamination of the Hetch Hetchy water supply will require higher levels of filtration,” analysts said. “The water system has sufficient treatment capacity to address any increased filtration needs from ash contamination even if the fire were to completely burn the area surrounding the reservoir.”
The utility filed a report with the Municipal Rulemaking Securities Board on Aug. 27, saying that as of that date, water quality had not been compromised.