Across industries, there is a redefinition of value occurring. Traditional financial metrics—centered around earnings, return on assets and financial capital—are increasingly inadequate in the face of systemic risks like climate change, biodiversity loss, and intensifying wildfires.
For electric utilities operating in fire-prone landscapes, the path forward is clear: build resilience by understanding and integrating natural capital into core business decisions.
According to a report by Blackrock, more than half of global GDP—roughly $58 trillion—is moderately or highly dependent on nature.
For utilities, this dependence is direct. Power lines traverse forests, transmission infrastructure crosses watersheds, and vegetation management now represents one of the largest operational expenditures in wildfire-prone regions. In short, utilities don’t just impact nature—their economic viability depends on how they interact with it.
The first industry to recognize this was agriculture - where weather volatility directly impacts their product quantity and quality. Athena Intelligence's origins are in AgTech and harvest projection. Our understanding of vegetation, terrain and weather trends gives us a unique perspective on your challenges with wildfire.
Until recent changes in accounting requirements, the value of this “natural capital”—forests, biodiversity, water, and land—was largely invisible on balance sheets. This is changing. Some public companies have secured billions in sustainability-linked loans by embedding environmental performance into financial strategy. The same logic applies to utilities: the better a utility understands its relationship with nature, the better it can access capital, attract investors, and work with groups like Blue Forest.
Wildfire is a fast-rising component of natural capital risk. Utilities exposed to wildfire are increasingly being scrutinized by investors, regulators, and the public—not just for their role in ignition risk, but for their broader risk management strategies. This includes land use, vegetation practices, biodiversity impacts, and water resource protection.
As utilities develop and refine Wildfire Mitigation Plans (WMPs), there is an opportunity to go beyond CYA-compliance, while reducing expenses. A terrain aware and nature-focused approach aligns wildfire mitigation with ecosystem stewardship— reducing flammable fuel loads, and supporting biodiversity—all while protecting critical infrastructure and communities.
Investors are Watching
Initiatives like the Taskforce on Nature-related Financial Disclosures (TNFD) are already influencing capital flows. Similar to how climate-related risks are increasingly priced into a utility's bonds, nature-related risks are beginning to shape investor expectations. BlackRock’s own research acknowledges that natural capital is not just an ESG issue—it’s a material financial risk. (TNFD Guidance for Water Utilities was issued January 2025.)
Utilities that proactively assess and disclose their natural capital dependencies and impacts will be better positioned in capital markets. Those that don’t risk being left behind, especially as insurance markets tighten and cost of capital increases in high wildfire risk zones.
From Output to Impact
For other industries, the global economy is shifting from an “output economy” focused on production and profit to an “impact economy” where consumers seek brands focused on organic production, customer wellbeing and health.
The utility equivalent is resilience, sustainability and long-term viability. For your team, this shift is both a challenge and an opportunity.
By redefining success to include nature, community, public health and water quality—not just financial performance—utility executives can lead their organizations toward a more climate-resilient future. This includes:
-
Embedding wildfire and nature risk into financial models and board-level strategy.
-
Recognizing and reporting on ecosystem services such as forest health, water quality, and biodiversity.
-
Disclosing material natural capital dependencies and impacts in the context of today's cost savings and the longer-term public health savings by avoiding the impact of wildfires.
-
Aligning wildfire mitigation investments with community resilience.
The Path Forward - The Question is no longer if utilities should account for nature—it’s How.
The tools, frameworks, and investor interest are already in motion. What’s needed now is leadership at the local level.
As the stewards of critical infrastructure and vast service areas, utility executives have both the responsibility and the opportunity to redefine what resilience looks like in the 21st century. That starts by valuing nature—not just as a risk to be managed, but as a form of capital to be protected, enhanced, and accounted for.