Jan 23, 2025 · 37m · no-priors
No Priors Ep. 98 | With Convective Capital Founder Bill Clerico
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of No Priors, hosts Elad Gil and Sarah Guo speak with Convective Capital founder Bill Clerico to examine the structural causes of California's wildfire crisis. The discussion covers the necessity of forest fuel management, regulatory barriers in energy and insurance, and the emerging wave of venture-backed wildfire technologies.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. The hosts hold 27.3% of the talking time here. How this is scored →
The hosts as informed peer 4.5 Guest teaching 5.5 Guest disagreement 1.3 The hosts pushing back 1.7
speaking balance: gold is the hosts, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 16:44 Bill rejects reservoir and water policy talking points
Bill directly pushes back on widespread claims that California's water mismanagement or lack of reservoirs caused the Palisades water failure, calling the connection tenuous and clarifying the issue was purely localized pipe depressurization.
Hardest push from the hosts ▶ 30:49 Elad challenges shifting regulatory burden onto homeownersElad refuses Bill's framing that higher building standards and private insurance requirements are the primary post-fire remedy, arguing that regulatory overburden is already the core problem and demanding what municipal government should provide instead.
Biggest teaching moment ▶ 15:00 Bill explains urban firestorm water pressure mechanicsBill breaks down the physics of urban fire response, explaining how hundreds of severed 5/8-inch residential connections flowing at 30 gallons a minute instantly drain pressure from million-gallon storage tanks.
The host holds their own ▶ 7:12 Elad quotes exact environmental review durations and lawsuitsElad demonstrates command of the regulatory timeline by citing the specific 4.7 to 7.5 year project review statistics and the 2007 Sierra Club categorical exclusion lawsuit.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | The hosts as informed peer | Guest teaching | Guest disagreement | The hosts pushing back | Why |
|---|---|---|---|---|---|---|
| Forest Management, Historical Suppression, and Climate Dynamics | 5 | 5 | 1 | 1 | Elad frames the dichotomy between attributing fires to climate change versus infrastructure and land management. Bill agrees climate plays a role but educates on the historical 10 AM maximum suppression policy causing 3x forest fuel density over the past century. | |
| Environmental Permitting Hurdles and Regulatory Bottlenecks | 7 | 4 | 1 | 1 | Elad demonstrates substantial domain research, citing exact statistics on NEPA/environmental review delays (4.7 to 7.5 years) and past Sierra Club lawsuits. Bill corroborates this with personal timberland management experience and USFS budget allocations. | |
| Comparing Prescribed Burning: California Versus Florida Practices | 4 | 7 | 1 | 1 | Sarah and Elad query regional differences and the wildland-urban interface (WUI). Bill delivers detailed comparative data between Florida's 2-3 million acre burn program and California's 100k acre target, alongside a 46% expansion in WUI housing. | |
| Pacific Palisades Fire Response, Water Infrastructure, and Pressures | 5 | 8 | 3 | 3 | Elad probes whether budget cuts and missing water infrastructure caused the Palisades failure. Bill directly refutes common online narratives, explaining the fluid dynamics of system depressurization from hundreds of melted half-inch residential pipes. | |
| Preventing Urban Conflagrations and Utility Ignition Hazards | 4 | 6 | 1 | 1 | Bill outlines how urban conflagrations spread differently from wildland fires and provides a breakdown of ignition sources, noting utilities cause only 11% of fires but 50% of the total damage. | |
| Utility Business Models, Capital Expenditures, and Regulatory Rate Caps | 6 | 7 | 2 | 4 | Bill explains utility rate-of-return economics, dispelling the idea that utilities avoid CapEx since they earn a 15% return on capital spend. Elad pushes back by asking why CA utility rates are already among the highest in the country if underinvestment was driven by rate caps. | |
| California Insurance Market Crisis and Regulatory Reforms | 5 | 7 | 1 | 1 | Sarah asks why insurers are leaving California. Bill gives a structured breakdown of admitted insurance regulatory limits, including restrictions on passing through reinsurance costs and mandates to use 30-year backwards-looking risk models. | |
| Wildfire Technology Frontiers: Autonomous Drones and Rapid Defense | 4 | 5 | 1 | 1 | Elad asks about autonomous drone suppression and simpler DIY chemical retardant defenses. Bill explains recent shifts in BVLOS regulations and payload capacities, advocating for individual homeowner fire gels. | |
| Post-Disaster Recovery, Building Standards, and Smokey Bear 2.0 | 5 | 6 | 2 | 5 | When Bill advocates for stricter building codes during rebuilding, Elad pushes back, noting that additional regulations seem to exacerbate bottlenecks rather than solve them, and asks what the municipality itself should be doing for taxpayers. | |
| Homeowner Defense Priorities, Permitting Fast-Tracks, and Security | 4 | 6 | 1 | 1 | Bill highlights Zone 0 defensible space for homeowners and outlines national security risks of coordinated multi-point wildfire ignitions across sensitive infrastructure. | |
| Episode Conclusion and Where to Follow No Priors | 0 | 0 | 0 | 0 | Standard podcast outro with Sarah Guo providing social links and subscription information. |
Statements from this episode (23)
Clerico: Wildfires Surged Due to Forest Management and Grid, Not Climate
“The reason that wildfires really reached a crescendo in the last 10 years, in my opinion, is not because of climate change, it's because of things like forest management, it's because of the way we've constructed our electrical grid, sort of more acute, self-i…”
Clerico: 98% of Climate Capital Goes to Mitigation, Only 2% to Resilience
“You know, I think if you look at climate capital that's deployed, 98% of it goes into what's called mitigation. So reducing CO two, two percent of it goes into resilience and adaptation.”
Clerico: Forest Fuel Density Has Tripled Over the Last Century
“The first, and in my opinion, the most important one is just that fuel density or force density is, has increased Three times since you know, really in the last hundred years.”
Clerico: Permitting conservation logging on 170-acre parcel took three years
“So I own a 170 acres of Timber. It's Douglas fir and redwood timber. Sarah's been there. And we did, I wanted to do treatment on that land. It hadn't been treated in a long time, and we wanted to log parts of it with a conservation strategy. It took three year…”
Gil: Prescribed burn environmental reviews take up to 7.5 years to complete
“For higher risk forest needing prescribed burns, it takes an average of 4.7 years to get through environmental reviews for simple projects and seven and a half years or so for longer. For more complex projects.”
Clerico: U.S. Forest Service spends 40% of budget, $250M, on planning
“The US Forest Service, I saw a stat, they spend 40% of their budget, which is about two hundred fifty million dollars a year on planning, right?”
Clerico: Florida conducts 2 to 3 million acres of prescribed burns annually
“Florida does two to three million acres a year of prescribed burning.”
Clerico: Prescribed burning creates asymmetric job risks for California fire chiefs
“If you're a local burn boss or fire chief and you want to do a prescribed fire, You know, it is the right thing to do, but it's kind of risky. If it escapes, if it burns someone's property, if you start the next, you know, Palisades fire, you know, you're gonn…”
Clerico: WUI housing units have increased by ~46% since 1980
“And if you look at growth of housing units in the WUI and the wild and urban interface, it's increased by like 46% since 1980.”
Clerico: Paradise voted down stricter fire building codes during rebuilding
“When the city went to rebuild, there was an opportunity to pass, you know, more significant building codes at the local level, and that was voted down because it was seen as sort of too expensive and too restrictive for people to build. So Paradise largely got…”
Clerico: Palisades Water Failed From Plumbing Depressurization, Not Supply Shortage
“The water issues were related to there's three, one million gallon tanks as houses burned down, the plumbing opens. If you've got like a five eighth or half inch plumbing connection into a house, that's going to run at 20 or 30 gallons a minute. You have 500 o…”
Clerico: Cal Fire Budget Is Roughly Triple the US Forest Service's
“Cal Fire's budget is, I think, about triple what the US Forest Service budget is.”
Clerico: Utilities Cause 11% of Ignitions but 50% of Wildfire Damage
“So utilities cause about 11% of ignitions, but those ignitions cause 50% of the damage.”
Clerico: Undergrounding Power Lines Costs $3M to $4M per Mile
“You know, undergrounding can cost three to four million dollars a mile, and so that, you know, manifests in, in larger electrical rates.”
Clerico: Regulated utilities profit by marking up CapEx 15% to ratepayers
“If, you know, PG&E spends five billion dollars undergrounding lines or upgrading transmission lines,
They get to mark that up by 15% and pass that through to ratepayers.
They love it.
That's how they make money.”
Clerico: Regulators, not utilities, block wildfire infrastructure investments
“And so there's sort of this, I think, ill-informed narrative that the utilities don't want to spend the money.
They actually love to spend the money and they would die to spend that money.
The issue is the regulators and the ratepayer advocates that basically …”
Clerico: Electric bills must rise to reflect California wildfire risk
“The cost of energy generation is sort of artificially low right now.
It does not reflect the risks of wildfire.
And so it probably means that electric bills need to go up, particularly in sort of high fire risk areas to fund a lot of this capex.”
Clerico: California Reinsurance Costs Have Doubled or Tripled Over 5 to 10 Years
“The cost of reinsurance in California has at least doubled, maybe tripled over the last five or 10 years.”
Clerico: Firefighting drones will perform rapid wildfire attacks within a decade
“So in my opinion, I think over the next five to 10 years, we will see exactly what you're talking about drones to do rapid initial attack. So you see you know, you get an ignition that's detected from a camera or satellite. And drones are pre-positioned can ge…”
Clerico: Free-market insurance rules should drive homeowner wildfire hardening
“To me, the real answer, which I think is harder, but probably the real answer is actually to have the insurance companies create an actual free market for the insurance companies where they can say, I will only insure your house if you do these things, right, …”
Clerico: Oregon sheriff arrested a US Forest Service worker over prescribed burn
“You know, there's very famous case up in Oregon where a local Republican sheriff arrested a U S forest service employee for doing a prescribed burn”
Clerico: Only weather changes, oceans, or massive retardant drops stop large wildfires
“Honestly, I think three things stop large wildfires. The weather changing, the ocean, or really large, massive aircraft dropping, you know, jets dropping huge amounts of retardant. You can't drop huge amounts of retardant in neighborhoods. It's too destructive…”
Clerico: Wildfires are an overlooked national security threat to critical infrastructure
“You know, I actually think there's a really big national security issue here around wildfire that doesn't really get talked about, but like, you know, okay, one thing to do to a neighborhood, but what about a military base? You know, what about a nuclear power…”