Xcel Energy agrees to pay $640M in settlements after Marshall Fire

DENVER (KDVR) — Xcel Energy has agreed to pay approximately $640 million in settlements after claims that its power lines and equipment caused part of the Marshall Fire in 2021, the most destructive wildfire in Colorado history.

On Wednesday, Xcel announced that it has reached an agreement in principle along with Qwest Corporation and Teleport Communications America, LLC to resolve all claims made by insurers, public entities and individual plaintiffs, although the energy provider said it doesn’t admit “fault, wrongdoing or negligence.”

This comes one day before jury selection was supposed to begin for a trial, according to an Xcel spokesperson.

“Despite our conviction that PSCo equipment did not cause the Marshall Fire or plaintiffs’ damages, we have always been open to a resolution that properly accounts for the strong defenses we have to these claims. In resolving all liability from the claims, this settlement reinforces our longstanding commitment to supporting the communities we serve,” said Bob Frenzel, chairman, president and CEO of Xcel Energy. “We recognize that the fire and its aftermath have been difficult and painful for many, and we hope that our and the telecom defendants’ contributions in today’s settlement can bring some closure for the community.”

Superior resident, mayor share complex emotions

FOX31’s Nicole Fierro spoke with the mayor of Superior, which was one of the hardest-hit towns in the path of the Marshall Fire.

“One out of every seven homes in Superior were lost in the Marshall Fire and we’ve been working over the past three and a half years to recover and rebuild,” Superior Mayor Mark Lacis said. “It’s a bittersweet end to this chapter of the recovery process.”

FOX31 spoke with Superior resident Basanti Kaul in 2023 after she lost her home to the Marshall fire and started rebuilding. After learning this update, we went back and knocked on Kaul’s door to ask her reaction.

“I’m kind of getting lumps in my throat, which is a reaction that you asked, so this should tell you that I am glad,” Kaul said. “I’m going, woo hoo, that they did think about that it’s a reality we have suffered. We are still dealing with this PTSD. But at the same time, what we have lost, some things totally can’t be compensated in any way, especially the place that I come from is India, but a disputed place, Kashmir.”

Kaul can never get her cultural artifacts back that were burned in the fire.

Lacis reflected on the timing, with the settlement news announced the day before jury selection was supposed to begin in the civil suit against Xcel.

“I think at the end of the day, the settlement is something that gives certainty and closure to a very difficult chapter for this entire community,” Lacis said. “And that’s a good thing. Rather than going through the uncertainty, the time, the money, the effort of an eight-week-long trial, which might not necessarily be the end of it. Right. There’s always the possibility of appeals. You never know how that’s going to go. So, certainty is a good thing.”

Fires cause the most destructive wildfire in Colorado history

This comes after the Marshall Fire sparked in late December of 2021, burning more than 6,000 acres, destroying 1,084 residential structures in Boulder County and seven commercial structures. Two people and more than a thousand pets were killed in the fire. In total, the fire caused an estimated loss of more than $2 billion.

In 2023, the Boulder County Sheriff’s Office said two separate wildfires caused the Marshall Fire, which included the reignition of an extinguished residential burn on property owned by the religious group Twelve Tribes, combined with a second fire likely caused by a damaged Xcel power line.

More than two dozen people filed a lawsuit against Xcel, stating that the company’s power lines and equipment were a “substantial factor in the cause, origin, and continuation of the deadly Marshall Fire.” Meanwhile, more than 150 insurance companies filed a lawsuit against Xcel as well.

In 2023, Xcel disputed the suggestion that its powerlines caused the second ignition and pointed to the area with underground coal fire activity, which investigators said they could not rule out as a factor. On Wednesday, Xcel still disputed the claims that the second ignition was started by its equipment.

Xcel has now agreed to pay approximately $640 million, with about $350 million funded by its remaining insurance coverage, not from the customers. The agreement is still subject to final documents, according to Xcel.

Xcel said it also developed a strategy to reduce wildfire risk with a “2025-2027 Wildfire Mitigation Plan” that includes investments in system resilience, improved situational awareness of high-risk fire scenarios, enhanced operations and maintenance practices.