After the Los Angeles Fires, Reexamining the Wildfire Crisis in the United States

The wildfires that struck Los Angeles County and neighboring areas in January likely will go down as the most damaging wildfire event in US history. The fires, headlined by the Palisades and Eaton Fires, destroyed more than 16,000 structures, most of them homes, and killed at least 29 people. As with any disaster, the set of factors that contributed to these fires is unique; nevertheless, the fires are consistent with a trend in the United States—and particularly in California. Fires are becoming increasingly frequent, large, severe, and destructive.

The fires in Los Angeles were especially intense for a few key reasons. The Palisades and Eaton Fires were fueled by intense downslope winds, like many of the most disastrous fires in California in recent years. Because of climate change, dry weather now frequently stretches late into the fall and winter, and fire season is more likely to overlap with the kind of hazardous wind conditions that can make fires spread more quickly and more difficult to control. By January, Southern California also had been without significant rainfall for eight months. Moreover, the previous two winters were very wet, so vegetation in the hills above Los Angeles was not only dry but also abundant.

The damages in dollar terms were extraordinarily high because of patterns in development and construction. While these damages were so large in part because of the areas affected—the Pacific Palisades neighborhood is in one of the most expensive ZIP codes in the United States—the sheer number of homes destroyed by the Palisades and Eaton Fires can be at least partially attributed to the extent of property in harm’s way. The Palisades Fire largely burned homes in areas that the California Department of Forestry and Fire Protection classified as “very high hazard” (though the Eaton Fire spread and did significant damage in areas that were adjacent to very high hazard zones).

As Los Angeles and other jurisdictions begin to think about what comes next, this blog post offers six lessons—drawn from research by scholars at Resources for the Future (RFF) and elsewhere—that can inform efforts to reduce the damage done by wildfires in the future.

Between 1990 and 2010, the number of people in the United States living in direct proximity to natural lands approximately doubled. While development in these areas—known as the wildland urban-interface—has slowed since 2010, approximately 35 percent of homes in California are within this wildland-urban interface.

Expanding development within high-hazard areas increases potential damage when fires occur. Nearly 50 percent of the growth in the number of houses exposed to wildfires from 1990 to 2020 was due to expanding development, with the remaining 50 percent due to increasing fire activity, according to one recent paper. RFF research finds that population growth in high-hazard areas will continue to contribute to exposure to wildfires over the next 50 years, especially in the southeastern United States, where both the population and wildfire hazard are expected to increase.

The odds that a home is damaged or destroyed during a fire depend on how easily a fire can reach and infiltrate that home. Building codes in California require new construction in certain high-hazard areas to use fire-safe materials, and homes built to these standards are significantly more likely to survive fires. Defensible space—a buffer zone around homes that is free of vegetation—also is now required in some high-hazard areas in California. Defensible space around structures is thought to reduce the threat of fire, in part by providing opportunities for firefighters to more safely defend the structures.

Retrofitting homes with fire-safe materials and maintaining defensible space can be expensive; however, disasters provide an opportunity to rebuild communities in safer and more resilient ways. Disasters also tend to drive a burst of increased attention toward efforts that reduce risk. For example, communities are more likely to enroll in Firewise, a community-level hazard-mitigation program, following fires. If policymakers in California want to reduce damages from fires in Los Angeles in the future, now is an opportune time to take bolder measures.

Increasing wildfire hazard and escalating losses from past fires are driving up the cost of providing insurance in areas with a high risk of wildfire. Even before the Los Angeles fires, this trend—in combination with other factors such as construction costs and regulations that make increasing insurance premiums more difficult—was leading insurers in California and elsewhere to drop policyholders or temporarily stop writing new insurance policies. In response, a growing number of California homeowners have been forced to turn to the Fair Access to Insurance Requirements plan, known as the FAIR plan. This plan, which was established by the state and is funded by private insurers, is the insurance policy of last resort for those who cannot find home insurance in the regular market.

In recent years, policymakers in California have struggled with the challenges of keeping home insurance affordable and available. Various options are available to policymakers who want to balance these objectives in a landscape of increasing risks. However, the cost of insurance generally increases as risk increases. All potential policy options must balance the extent to which insurance companies can increase premiums for those living in high-risk areas and the extent to which the cost to insurers of increasing risk can be spread out, whether to other policyholders in the state or elsewhere, or to taxpayers.

The consequences of wildfires extend beyond their impacts to homes and other structures. One study found that damage to structures and other physical capital accounted for only 19 percent of damages caused by the wildfires in California in 2018 (which included the Camp Fire, the most destructive wildfire in state history prior to the fires in Los Angeles). Direct losses from destroyed structures can have follow-on consequences in the forms of higher insurance prices and impacts on municipal budgets. Fires also have indirect effects on local economies due to road closures, evacuations, and, in some cases, reductions in spending on recreation and tourism. Fires can negatively affect water quality, as well. Finally, wildfires release massive amounts of carbon dioxide into the atmosphere. Emissions from wildfires in California in 2020 undid nearly 20 years of greenhouse gas emissions reductions in the state. This smoke causes widespread negative health impacts in addition to exacerbating climate change.

Wildfire smoke includes large quantities of small particulate matter known as PM2.5, which can cause serious health consequences due to its ability to infiltrate the bloodstream through the lungs. The share of overall PM2.5 produced by wildfires has been increasing. In recent years, more than 25 percent of exposure to PM2.5 in the United States has been driven by fires; this number is even higher in some Western states. The health consequences of PM2.5 are severe and likely rival the costs of damages to structures when measured in dollar terms.

Reversing the trend of increasing emissions from wildfire smoke likely will require significant investments in mitigating fire hazards across boundaries of land ownership. Yet, in spite of recent federal investments in reducing fire hazards, concerns around air quality generally are not a primary factor in determining the locations of mitigation treatments, and federal air-quality policy currently does not provide incentives for state and private landowners to reduce hazard. However, rules under the Clean Air Act could be adapted to encourage states to mitigate wildfire hazard.

In dry forests in the West, the attempt over the last 100-plus years to exclude fire from the landscape has resulted in an unnatural buildup of flammable vegetation. Climate change, in the form of longer droughts and higher temperatures, makes this vegetation even more flammable, which facilitates larger and more intense fires. In places where accumulating forest fuels are contributing to fire hazard, the removal of these fuels can mitigate risk to homes while also limiting the consequences of high-severity fires for air quality, carbon dioxide emissions, and water quality. The US Forest Service estimates that 50 million acres of high-risk federal, private, state, and Tribal lands across the United States—an area approximately the size of Nebraska—need to receive fuel-removal treatment over the next 10 years to address the current wildfire crisis.

Estimates of the cost of such a program of treatment generally are based on back-of-the-envelope calculations, but a recent, more detailed analysis by RFF finds that fuel-removal treatment in California could cost between $225 million and $1.8 billion per year over 10 years (depending on the extent of the area treated). While this sum is significant, losses from the Los Angeles fires dwarf the high figures, even without considering the damages due to smoke and economic disruptions. Rigorous benefit-cost analysis of fuel treatments is challenging, but the research that is emerging indicates that increasing investment in fuel treatments would be worthwhile based on the savings from avoided costs of fire suppression alone. Moreover, in some places, market solutions can be used to reduce the costs of removing fuels.

The fires in Los Angeles were unlike any wildfire event our country has ever seen. Damages to individuals and communities were staggering. Nevertheless, the fires represented just the most recent apex in a long-term trend of increasingly damaging and destructive fires. The increasing threat of fire presents significant challenges for housing and insurance markets, public health, climate mitigation, and more. But while these challenges are significant, strategies are available to manage them. By investing in vegetation management to reduce fire hazard, hardening homes and communities against fire, and reducing the pace of development within the highest-hazard areas, we can minimize the damage from wildfires in the future. These steps will require engagement across all levels of government: while states and local governments are best situated to try to reduce exposure and vulnerability of homes to wildfire risk, continued engagement and investment from the federal government is needed for comprehensive vegetation management to reduce wildfire hazard. Now is the time to double down on these efforts, to prevent events like the fires of this past January in the future.