Energy and Resources Group Master’s Project

Mark Stout 5/25/1997

Comparative Power Analysis of the California Electric Utility Industry Deregulation Process

“The Electric utility is changing. But unlike the evolution of species, conscious collective choice can influence the evolutionary drift of the industry.” Rodney E. Stevenson and David W. Penn (1995)

Table of Contents
INTRODUCTION................................................................................................................................................ 4 OBJECTIVES ...................................................................................................................................................... 5 METHODOLOGY .............................................................................................................................................. 5 HISTORY OF ELECTRIC UTILITY INDUSTRY REGULATION................................................................. 8 THE BIRTH OF STATE PUBLIC UTILITY COMMISSIONS................................................................................................ 8 FEDERAL POWER ACT OF 1935................................................................................................................................. 9 PUBLIC UTILITY HOLDING COMPANY ACT OF 1935................................................................................................... 9 PUBLIC UTILITY REGULATORY POLICIES ACT OF 1978 ............................................................................................ 10 ENERGY POLICY ACT OF 1992 ............................................................................................................................... 10 CPUC “BLUE BOOK” PROPOSAL............................................................................................................................ 12 FERC MEGANOPR .............................................................................................................................................. 13 CPUC MAY 1995 DRAFT PROPOSALS AND STAKEHOLDER RESPONSES .................................................................... 14 CPUC DECEMBER 1995 DECISION AND CALIFORNIA ASSEMBLY BILL 1890............................................................. 17 RECENT STATE AND FEDERAL ACTIVITY ................................................................................................................ 20 FACTORS BEHIND THE DRIVE FOR DEREGULATION........................................................................... 21 LARGE CONSUMER PRESSURE ................................................................................................................................ 21 TECHNOLOGY ....................................................................................................................................................... 23 ECONOMIC RENT ................................................................................................................................................... 23 ACADEMICS & IDEOLOGUES .................................................................................................................................. 23 EXISTING COMPETITIVE FORCES ............................................................................................................................ 24 OTHER INDUSTRIES AND COUNTRIES ...................................................................................................................... 24 FEDERAL REGULATORY POLICY ............................................................................................................................. 24 STATE REGULATORY POLICY ................................................................................................................................. 26 ANALYSIS ......................................................................................................................................................... 27 SELECTION OF STAKEHOLDER GROUPS ................................................................................................................... 29 OVERVIEW OF WHAT THE STAKEHOLDERS WANTED AND WHAT THEY GOT ............................................................. 29 STAKEHOLDER INTERVIEWS CLUSTER ANALYSIS .................................................................................................... 36 OFFICEHOLDER STAFF INTERVIEWS ........................................................................................................................ 40 Officeholder Staff Comments on Who Got What They Wanted and Why:.......................................................... 41 Synthesis of Stakeholder & Staff Comments on Who Prevailed, and Why:........................................................ 43

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Officeholder Staff Comments on Who Got Rolled Over, and Why: ................................................................... 44 Synthesis of Stakeholder & Staff Comments on Who Got Rolled, and Why:...................................................... 46 RESTRUCTURING STAKEHOLDER CAMPAIGN CONTRIBUTION/GIFT ANALYSIS ........................................................... 52 CONCLUSION................................................................................................................................................... 60 BIBLIOGRAPHY .............................................................................................................................................. 61 APPENDIX A: SEMI-STRUCTURED INTERVIEW QUESTIONS............................................................... 66 STAKEHOLDER INTERVIEWS ................................................................................................................................... 66 OFFICEHOLDER STAFF INTERVIEWS ........................................................................................................................ 66 APPENDIX B: STAKEHOLDER INTERVIEWS............................................................................................ 67 INVESTOR-OWNED ELECTRIC UTILITIES ................................................................................................................. 67 Pacific Gas & Electric..................................................................................................................................... 67 San Diego Gas and Electric ............................................................................................................................ 70 Southern California Edison ............................................................................................................................. 74 MUNICIPAL ELECTRIC UTILITIES ............................................................................................................................ 76 California Municipal Utilities Association - Interview #1 ................................................................................ 76 California Municipal Utilities Association - Interview #2 ................................................................................ 79 Sacramento Municipal Utility District ............................................................................................................. 80 UTILITY LABOR UNIONS ........................................................................................................................................ 85 Coalition of California Utility Employees - Interview #1 ................................................................................. 85 Coalition of California Utility Employees - Interview #2 ................................................................................. 86 INDEPENDENT PRODUCERS .................................................................................................................................... 88 American Wind Energy Association................................................................................................................. 88 Independent Energy Producers........................................................................................................................ 92 LARGE ELECTRICITY CONSUMERS .......................................................................................................................... 96 Agricultural Energy Consumers Association.................................................................................................... 96 California Industrial Users.............................................................................................................................. 98 California Large Energy Consumers Association - Interview #1 .................................................................... 102 California Large Energy Consumers Association - Interview #2 .................................................................... 104 California Manufacturers Association ........................................................................................................... 107 SMALL ELECTRICITY CONSUMERS........................................................................................................................ 111 Latino Issues Forum ...................................................................................................................................... 111 The Utility Reform Network ........................................................................................................................... 114 ENVIRONMENTAL ADVOCATES ............................................................................................................................ 119 Environmental Defense Fund ........................................................................................................................ 119 Natural Resources Defense Council - Interview #1 ........................................................................................ 122 Natural Resources Defense Council - Interview #2 ........................................................................................ 125 Sierra Club/Center for Energy Efficiency and Renewable Technologies ........................................................ 127 Union of Concerned Scientists....................................................................................................................... 133 STATE INSTITUTIONS ........................................................................................................................................... 137 California Energy Commission...................................................................................................................... 137 University of California, California Institute for Energy Efficiency ............................................................... 141 ANONYMOUS STAKEHOLDER COMMENTS ............................................................................................................. 144 Anonymous Comments #1: Parties who could have improved their performance ........................................... 144 Anonymous Comments #2: AB 1890 funding levels for Public Interest RD&D............................................... 144 APPENDIX C: OFFICEHOLDER STAFF INTERVIEWS ........................................................................... 146 California Public Utilities Commission ......................................................................................................... 146 Legislative Conference Committee, Office of Senator Steve Peace ................................................................ 148 Legislative Conference Committee, Office of Senator Byron Sher.................................................................. 152 Legislative Conference Committee, Office of Senator Bill Leonard ............................................................... 153

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Anonymous Officeholder Staff Interview #1 ................................................................................................... 155 Anonymous Officeholder Staff Interview #2 ................................................................................................... 156 APPENDIX D: CLUSTER ANALYSIS OF STAKEHOLDER INTERVIEW DATA................................... 159 APPENDIX E: RESTRUCTURING STAKEHOLDER CAMPAIGN CONTRIBUTION/GIFT ANALYSIS DETAIL............................................................................................................................................................ 162 Table 1: Assemblymember Jim Brulte, 1995 Campaign Contributions........................................................... 162 Table 2: Assemblymember Jim Brulte, 1996 Campaign Contributions........................................................... 163 1995/1996 Stakeholder Gift Information for Assemblymember Jim Brulte ..................................................... 164 Table 3: Senator Steve Peace, 1995 Campaign Contributions ....................................................................... 164 Table 4: Senator Steve Peace, 1996 Campaign Contributions ....................................................................... 165 1995/1996 Stakeholder Gift Information for Senator Steve Peace.................................................................. 166 Table 5: Senator Byron Sher, 1995 Campaign Contributions......................................................................... 166 Table 6: Senator Byron Sher, 1996 Campaign Contributions......................................................................... 166 1995/1996 Stakeholder Gift Information for Senator Byron Sher................................................................... 170 Table 7: Senator Bill Leonard, 1995 Campaign Contributions ...................................................................... 170 Table 8: Senator Bill Leonard, 1996 Campaign Contributions ...................................................................... 171 1995/1996 Stakeholder Gift Information for Senator Bill Leonard................................................................. 171 Table 9: Assemblymember Mickey Conroy, 1995 Campaign Contributions.................................................... 172 Table 10: Assemblymember Mickey Conroy, 1996 Campaign Contributions.................................................. 173 1995/1996 Stakeholder Gift Information for Assemblymember Mickey Conroy.............................................. 173 Table 11: Assemblymember Diane Martinez, 1995 Campaign Contributions ................................................. 175 Table 12: Assemblymember Diane Martinez, 1996 Campaign Contributions ................................................. 176 Table 13: Assemblymember Steve Kuykendall, 1995 Campaign Contributions............................................... 177 1995/1996 Stakeholder Gift Information for Assemblymember Diane Martinez ............................................. 177 Table 14: Assemblymember Steve Kuykendall, 1996 Campaign Contributions............................................... 178 1995/1996 Stakeholder Gift Information for Assemblymember Steve Kuykendall........................................... 178 1994/1995 Stakeholder Gift Information for CPUC President Daniel Fessler................................................ 179 1994/1995 Stakeholder Gift Information for Commissioner Gregory Conlon ................................................. 181 1994/1995 Stakeholder Gift Information for Commissioner Jesse Knight, Jr. ................................................ 181 1994/1995 Stakeholder Gift Information for Commissioner Norm Shumway .................................................. 181 1994/1995 Stakeholder Gift Information for Commissioner Josiah Neeper .................................................... 181 1994/1995 Stakeholder Gift Information for Commissioner Henry Duque ..................................................... 181

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The vision of electric utility deregulation legislated in AB 1890 is significantly different from that contained in the California Public Utility Commission’s (CPUC) December. This paper develops a comparison of which stakeholder groups got what they wanted. Governor Pete Wilson signed into law California Assembly Bill 1890 (AB 1890).edf. selling 250 billion kWh of electricity per year2. which will be superseded to a great extent by the details of AB 1890. Various stakeholder groups. 1996. and why. 1 2 CPUC RD&D Working Group. 1995 Decision with the California legislative process resulting in AB 1890. acid rain and climate change.4 Given the stakes involved with this industry. fossil fuel-based electricity generation is currently the largest source of greenhouse gas emissions and the largest source of air pollution in the U. there will probably be significant winners and losers as a result of this legislation. 1995 3 Flavin and Lenssen. 1995 Electric Restructuring Decision. representing a spectrum of private and public interests attempted to influence both the CPUC and legislative processes. This bill is an important milestone in an ongoing process towards electric utility deregulation in California. a product with well documented environmental impacts including local air pollution.org/programs/Energy/green_power/a_better. with varying success. 1996 California Energy Commission. which sets in motion a process of electric utility deregulation beginning in 1998.3 According to the Environmental Defense Fund. contrasting the results of CPUC process resulting in their December. California electric utilities have a combined annual revenue of roughly $23 billion dollars1.S.html ERG Master’s Project Mark Stout 4 .Introduction On September 23. 1994 4 WWW page: http://www.

Objectives
• Evaluate which stakeholder groups got what they wanted: Each stakeholder group influencing the process pursued policy outcomes that they felt were in their self-interest. This paper determines which groups had their requests granted, and which had their requests ignored, looking at both the language of AB 1890, as well as the CPUC December, 1995 decision. Groups that fared better in one arena than the other are highlighted. Determine why or why not a stakeholder group was successful in getting what they wanted out of each policy process: In many cases, interest groups were able to influence outcomes in the legislative and/or CPUC forums through well reasoned comment filings, direct lobbying, campaign contributions, as well as other avenues. This paper explores what mechanisms the different interest groups used to influence these policy outcomes, contrasting differences in techniques applied between the Legislature and CPUC, focusing on whether each decision making body or individual had particular avenues that were most effective.

Methodology
In order to answer the questions of which stakeholder groups got what they wanted and why, I based my research on an analysis of three categories of data: 1) background utility regulation literature, 2) semi-structured interviews with stakeholders as well as CPUC and legislative staff, and 3) archival analysis of CPUC filings, legislative language and videos, and state officeholder filings. Rather than approaching the data with a hypothesis to verify, I compare and cluster the data to allow patterns to flow out that can then generate theories. I compare the CPUC and legislative policy processes, determining similarities and differences in how each party fared in each forum, as well as why each party fared as they did. This data-driven approach to the generation of theory is based on the work of Glaser and Strauss, who contrast the use of data to

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generate grounded theory with the use of data to verify logico-deductive theory.5 Below I describe the use of each of these data types. Background literature on electric utility regulation is used to provide a historical context for California’s electric utility deregulation, which is presented in the next two sections of this report, History of Electric Utility Industry Regulation and Factors Behind the Drive for Deregulation. Semi-structured interviews were conducted with 26 representatives of different stakeholder organizations. The semi-structured format allows flexibility in altering the flow of the interview, following up on interesting points as they arise. I selected an initial set of organizations to contact, trying to cover as wide a spectrum of stakeholder groups as possible, based on my experience representing a stakeholder organization on the issue of electric utility deregulation in the CPUC and legislative arenas. Most interviews were conducted in person, while several where over the phone. As I conducted interviews, subjects referred me to additional representatives to contact, both in their organizations as well as in others. An interview guide was used for

recording notes, which were typed up later. Questions were developed for the interview guide to determine for each organization what outcomes were sought, what outcomes were obtained in each of the policy decisions, and what methods and strategies were used to influence each policy decision. A list of questions for the semi-structured stakeholder interviews is included in

Appendix A. A full transcript of these interviews is included in Appendix B. These interview subjects are clustered into the following categories for analysis: investor-owned electric utilities, municipal electric utilities, utility labor unions, independent producers, large electricity consumers,

5

Glaser and Strauss, 1967, Glaser, 1978.

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small electricity consumers, environmental advocates, and state institutions. The organizations represented by each interview subject are listed, by category, in the Table of Contents for Appendix B. Semi-structured interviews were conducted with two staff of the CPUC and three staff of members of the legislative Conference Committee on Electric Industry Restructuring. An

interview guide was used, with questions developed to determine which stakeholder organizations were perceived by the staff as being most effective in influencing the respective policy outcome, and why; which stakeholder organizations were perceived as being able to set the terms of the debate, and why; as well as which stakeholder organizations were perceived as least effective in influencing that policy outcome, and why. A list of questions for the semi-structured officeholder staff interviews is included in Appendix A. A full transcript of these interviews is included in Appendix C. Finally, an archival analysis was performed on the CPUC formal filings, Fair Political Practices Commission records, Secretary of State Political Reform Division records, proposed and final legislative language, as well as legislative conference committee videos. The CPUC filings can be used to cross-check what each major interested party had originally requested from the process, tracking how that may change over time, as well as to determine policy outcomes from the CPUC. The California Fair Political Practices Commission archives an annual Statement of Economic Interest for each state office holder. The EIS forms for the CPUC Commissioners and Conference Committee members were examined to determine which organizations used trips, events, meals, and other gifts to gain access to decision makers. The California Secretary of State Political Reform Division keeps Officeholder, Candidate, and Controlled Committee Campaign Statements on file for each elected state officeholder and candidate. These Statements were ERG Master’s Project Mark Stout 7

they were not always viewed this way. However. Cities would grant multiple franchises to electricity companies. March. cross-check interview impressions. The result was not healthy competition keeping down the consumer’s bill. The Division’s March. a historical look at Federal and state electric utility regulation is in order. thus leading to a monopoly. 1997. Competition could keep prices down. and experience the witty banter between Senators Steve Peace and Bill Leonard. In the face of this trend local governments began to view 6 California Secretary of State. 1997 report on Lobbying Expenditures and the Top 100 Lobbying Firms6 also gives a big-picture view of overall lobbying expenditures by stakeholders.examined to track campaign contributions to the legislative Conference Committee members. but many weak companies that were soon bought out by a strong one. The Birth of State Public Utility Commissions Electric utilities have been considered natural monopolies over most of this century. and how much of it was getting incorporated into the final AB 1890 language. most cities believed regulation was superfluous. ERG Master’s Project Mark Stout 8 . due to decreasing marginal costs and the savings gained by avoiding redundant distribution networks. The legislative Conference Committee videos were used to gain insights into the dynamics of this public hearing process.. Proposed AB 1890 language was examined to get a flavor for who was making proposals. History of Electric Utility Industry Regulation Before examining which stakeholder groups were able to influence the California electric utility deregulation process.. as Davis explains: “Prior to World War I.

Hempling explains. or were owned by. electric utilities developed a pyramid scheme based on holding companies that was effective at obscuring market dominance. led to the passage of the Federal Power Act.” This legislation sought to avoid market abuses by limiting the size and 7 Davis. This being the case the best solution seemed to be regulation by public commission. ERG Master’s Project Mark Stout 9 .7 Federal Power Act of 1935 The growing interconnection of local utilities in interstate grids.utilities as natural monopolies and hence inevitable. a small number of holding companies owned most utilities in the United States.” The early 1900s were marked by the rapid increase in electric utility regulation by state public utility commissions (PUCs) to address this natural monopoly character. A number of these holding companies owned. this act expanded the role of the Federal Power Commission to regulate wholesale electric transfers. large nonutility companies such as electric equipment contractors. Beginning in 1907 with New York and Wisconsin. by 1922 47 states and the District of Columbia were regulating electric utilities. with at least 20% of electricity crossing state lines in 1935. “Before passage of the Public Utility Holding Company Act of 1935 (PUHCA). State and Federal regulation of rates and securities failed to keep up with sophisticated holding company attempts to evade regulation.8 Public Utility Holding Company Act of 1935 In order to establish market power which would otherwise have been illegal under antitrust law. Based on the Interstate Commerce Clause. 166-167.

17.investment options of utilities so that each was confined in scope to an “integrated public-utility system. This legislation allowed FERC to order utilities to provide transmission access at non-discriminatory rates.”910 Public Utility Regulatory Policies Act of 1978 Passed by Congress as part of President Carter’s National Energy Plan. PURPA was very significant in creating a market for non-traditional generators. ERG Master’s Project Mark Stout 10 . started by PURPA. 10 Davis. 11 Pechman. It also opened the door for more widespread wholesale competition by requiring that regulated utilities purchase power from Independent Power Producers (IPPs) classified as Qualifying Facilities (QFs) at avoided cost. recent successor to the FPC. 343. PURPA aimed to set standards for state PUC ratemaking that would promote energy savings and be partial to residential consumers over industrial consumers. this was the marginal cost associated with procuring new generation capacity.11 Energy Policy Act of 1992 EPAct continued the Federal trend. It also created new 8 9 Pechman. towards more competition in electricity generation. Hempling. which is critical for wholesale competition. Qualifying Facilities were primarily cogeneration and small renewable energy electricity producers. 166-167. was charged with writing the rules required to implement this legislation. In capacity constrained systems. 16. The Federal Energy Regulatory Commission (FERC).

”15 EPAct attempts to correct this supply-side/demand-side imbalance by encouraging state Public Utility Commissions to consider. These lead to what the National Association of Regulatory Commissioners calls the “payback gap”: substantially higher rate of return expectations for energy efficiency measures compared to supply-side investments. Stevenson. 14 Also. Utilities lose money when customers engage in conservation.12 While encouraging wholesale competition.classes of IPPs including Exempt Wholesale Generators.and demand-side options systematically when seeking least-cost energy 12 13 Stevenson. regulated utilities were discouraged from pursuing demand-side resources because of a profit structure that was directly linked to the amount of energy sold.13 and the transient nature of short term building owners and renters.” 521.. One prominent utility regulator remarked on the situation that had developed in the 1980s: “In the current scheme of regulation.” 407.”.... 356. This money-losing proposition is not significantly improved by any of the conservation cost recovery or incentive mechanisms now in use. allowing larger generation plants to be exempt from traditional regulation. “1) implementing Integrated Resource Planning (IRP). “Global Warming and Least-Cost.. Energy efficiency is often underinvested in due to the high transaction costs of decentralized customer decisions. 15 Cavanagh.. ERG Master’s Project Mark Stout 11 .” 356-357. EPAct also aimed to level the playing field for supply-side and demand-side (energy efficiency) resource options. “Social Goals. inadequate information available to customers. “Discretionary Evolution. They likewise lose money when the encourage customers to engage in conservation. 14 Cavanagh. “Energy Efficiency Solutions.. utilities make money in only one way--selling [units of energy]. which compares supply..

6. 1996. with large. the CPUC issued a staff proposal regarding electric utility deregulation known as the “Blue Book”. 2) providing cost recovery for energy efficiency programs that are at least as profitable as supply side measures. and if successful. The Blue Book laid out an aggressive. This utility restructuring involves the divestiture of utility electricity generation facilities into separate companies from the original utility which would still be responsible for transmission and perhaps distribution. ERG Master’s Project Mark Stout 12 . customer class-staged schedule for direct access implementation. sending “a shockwave through the electric industry”. 55. These generation companies would then compete with Independent Power Producers (IPPs) to provide power to a central electricity grid operator based on a combination of pool-based wholesale competition as well as direct contracts with individual customers. 18 Mydans. especially since the California regulators have been considered in the past to be one of the leading regulatory commissions and many states have followed their recommendations. 2002.”16 CPUC “Blue Book” Proposal California’s Public Utility Commission is widely viewed as a trend-setter for state PUC electric utility regulation. all commercial customers eligible January 1. In April of 1994.supplies. all residential consumers eligible on January 1.18 The proposed deregulated electricity market would allow individual customers to choose their electricity generation supplier using bilateral contracts in a system known as retail wheeling or direct access. and 3) rate changes to encourage efficiency and distribution of power. industrial customers taking power at the transmission level eligible on January 1. Hoffman.17 A security analyst noted that the release of the Blue Book will: speed up the deregulation of the industry. A more definitive policy statement was 16 17 Haddad. 1999.

1994. This led to the passage of Assembly Concurrent Resolution 143. “alternative frameworks based on ‘let the market decide’”. environmental organizations were frightened by the Commission’s decision to move away from the current IRP process and mechanism for decoupling utility profits from sales volumes. Wagner. were concerned about the content and timetable of this proposal. prompted the Assembly Committee on Utilities and Commerce and the Assembly Committee on Natural Resources to hold a joint oversight hearing on May 23. coupled with a lack of prior coordination with the state Legislature. 1995. which requires the CPUC to engage in a series of public hearings. such as “green pricing”. which had been dubbed the MegaNOPR. pushing back their goal for a policy decision until September of 1995. where CPUC President Fessler and Commissioner Knight testified on their proposal. The first issue addressed open access to the transmission system 19 20 CPUC. 1994. and asserted that. Blue Book. evidentiary hearings. and documentation resulting in a report back to the Governor and Legislature by January 31. This process tempered the CPUC’s frenetic timetable. 1. FERC released a dual-issue Notice of Proposed Rulemaking.19 Since the release of the Blue Book proposal. For instance. where customers voluntarily pay more to promote renewables. 1994.20 Many stakeholders. including private and public-interest organizations. Status Report. numerous other states have also proposed electric utility deregulation. 1995.22 FERC MegaNOPR In March of 1995. 21 CPUC.21 This stakeholder response. In their place. Blue Book. “a vibrant market exists for energy efficiency services”.scheduled to be issued by the CPUC in August of 1994. the CPUC proposed. ERG Master’s Project Mark Stout 13 .

The majority proposal known as PoolCo. Retail contracts with a particular generator could be handled with separate “contracts for differences”. Stranded costs are past investments rendered uneconomic (market value less than book value) by the competition brought about through deregulation.24 22 23 CPUC. A common price for all electricity in the state would then be set by the market clearing price based on the bids. in May of 1995. is based on a common wholesale power pool. Generators are scheduled into the pool based on time-based bids submitted to the ISO. The MegaNOPR also granted utilities the ability to collect 100% of their stranded costs due to wholesale transactions. All power purchases would be made through the pool.23 CPUC May 1995 Draft Proposals and Stakeholder Responses As a result of the Blue Book CPUC staff proposal. the California Commissioners released two draft proposals for pursuing rate deregulation in California. favored by CPUC President Fessler and two other Commissioners. scheduled and dispatched by an independent system operator (ISO). meaning the utilities could not discriminate against other electricity suppliers. 1997. some thought the MegaNOPR ruling may set a precedent for 100% stranded cost recovery at the retail level. which is usually considered state jurisdiction. 24 CPUC PoolCo Proposal ERG Master’s Project Mark Stout 14 . forcing utilities to allow non-utility generators to use their transmission systems on a “comparable basis” at standard tariffs. Although stranded costs due to wholesale competition would be much smaller then those posed by retail competition. Asmus and Smeloff.for wholesale transactions. Status Report. 1995.

Bids for generation into the pool would be processed by a Power Exchange (PX). a group of seemingly influential special interests. and R&D were not to exceed 3. who is responsible for maintaining transmission system reliability. Out of this surcharge. including bilateral contracts for direct access customers. Prices would be determined either through bilateral contracts between direct access customers and generators.3% of total utility revenue requirements as of January 1. No central entity would schedule power generation. 1995. know as the “Memorandum of Understanding” (MOU). Southern California Edison Company (one of three regulated. Full stranded cost recovery is agreed to for Edison. renewables. and the actual generation scheduling and dispatch decisions would be made by a separate Independent System Operator based on transactions mediated by the PX as well as direct access contracts. the only IOU signing the MOU. investor owned utilities in California). wholesale pool. The MOU also proposed a nonbypassable charge to fund public policy programs. as well as a central. low-income ratepayer assistance would be funded at an uncapped. and Independent Energy Producers. In structure. and low-income weatherization would be funded at 25 CPUC Direct Access Proposal ERG Master’s Project Mark Stout 15 .Commissioner Knight’s alternate proposal is based on direct access contracts between generators and customers. at the prompting of California Governor Pete Wilson. it is a hybrid of the two proposals. California Manufacturers Association. although generators would submit projections to an independent system operator (OPCO). met to iron out differences between them and draft their own industry restructuring proposal. as-needed basis. California Large Energy Consumers Association.25 In response to the Commissioner proposals. funding levels for energy efficiency. or through the creation of optional pools which could manage bids in a manner similar to the PoolCo proposal.

UCS. and Towards Utility Rate Normalization (TURN) submitted a “Framework for Restructuring in the Public Interest” to the CPUC. 26 27 MOU Parties. 1995. EDF. a coalition of public interest groups and renewable energy advocates.1995 levels. The Framework calls for less than 100% stranded cost recovery. uneconomic investments. By combining this with effective Performance Based Ratemaking. The Framework calls for equitable opportunities for small consumer participation in any move to allow direct access. 1995. The Framework. but spells out a set of public interest concerns that should be addressed by any industry restructuring including mitigation of market power. should see short and long term rate reductions. ERG Master’s Project Mark Stout 16 . To enhance energy efficiency efforts. continuation of low income programs. including NRDC. to decouple utility profits from sales volume. a new mechanism is to be developed. in the spirit of the existing Electric Revenue Adjustment Mechanism (ERAM). (PBR). small customer equity. Utilities Consumer Action Network.26 The CPUC held a full-panel hearing to focus on the details of the MOU in September of 1995. the Framework demands that each individual utility customer. and continued progress for energy efficiency and renewable resources. As in the MOU. including residential and small commercial consumers. but with increased funding levels to restore energy efficiency and R&D spending at pre-Blue Book levels. does not actually propose a specific electric utility industry structure. as a response to the MOU. a non-bypassable systems benefits charge is proposed. with utility shareholders accepting some of the burden for past. and at the level of attention given to the MOU. A minimum level of renewables is proposed for each IOU supply portfolio to return the states resource diversity to 1993 levels.27 Outraged that they had been left out of the MOU negotiating process. Framework Parties.

coupled with an IOU rate cap at January 1. so that input can be made to the Legislature. with financial incentives tied to the level of divestiture. through a Competitive Transition Charge (CTC).29 The spring and summer of 1996 saw a flurry of deregulation activity as PUC working groups fleshed out options for moving towards the PUC vision. The Decision called for 100% stranded cost recovery by IOUs over a five year period. A legislative conference 28 Framework Parties. direct access contracts. PG&E (Pacific Gas and Electric) and SCE. 1995. “be based on need”. which should. based on a wholesale Power Exchange.28 CPUC December 1995 Decision and California Assembly Bill 1890 Building on their previous proposals and stakeholder input. and an Independent System Operator centrally controlling California’s transmission system. ERG Master’s Project Mark Stout 17 . the Decision proposed a nonbypassable “public goods charge” (PGC). requesting input from stakeholder working groups. as well as a “minimum renewables purchase requirement”. and allow for uncapped low-income programs.expand renewables development above 1993 levels while commercializing new renewable energy technologies. with several key implementation areas to be hammered out by stakeholder working groups. 1995 which laid out a more defined vision of a deregulated ut ility environment. the CPUC released a policy decision on December 20. while the state Legislature took up the issue of electric utility deregulation on their own terms. The December Decision mirrored the market structure defined in the MOU. The Decision also called for the voluntary divestiture of 50% of fossil fuel generation plant owned by the two largest IOUs. nor a renewables purchase requirement level. Aside from funding levels for low-income rate discounts. bilateral. the Decision does not define any public program funding levels. 1996 levels. For public purpose programs.

December.34 There is concern that 29 30 CPUC."33 However. As the PUC stakeholder working group process drew to an end. other market participants. TURN. cutting deals with the stakeholders that would be required to “deliver the votes” within the committee.committee on deregulation worked at breakneck speed. 1996 32 Weisman. Even given the large economic and environmental stakes. and confidential correspondence with stakeholder representative. arguing that it should not be used as a national model for protection of residential and small commercial consumer interests. California Public Utilities Commission President Conlon praised members of the legislative conference committee: "It is through their tireless efforts that this legislation was crafted to provide balance of interests between utilities. the final product of this bipartisan conference committee handily passed on the Senate and Assembly floors with minimal debate. but some have argued that the environmental organizations are not effectively representing the interests of their constituencies32. 1995 Decision. small consumer group. a prominent. since it was perceived as a best effort compromise between the two main political parties. and especially residential and small commercial California ratepayers. compared to the reckless pace of the legislative wrangling. Pete Wilson signed AB 1890 on September 2330. 1996 34 TURN press release. 1996 ERG Master’s Project Mark Stout 18 . neither process involved substantial public education or participation. While the pace of the PUC process was tempered so that their final policy decision could better reflect stakeholder interests. omnibus legislation which preempts much of the PUC vision31. 1996 31 Rader. 33 CPUC press release. 1996 Roadmap CPUC press release. Several public interest organizations served as advocates for small consumer and environmental protection. has criticized AB 1890. 1997.

but due to the Decision’s lack of clarity about support levels. along with a guaranteed 100% cost recovery for uneconomic utility assets. 1996 37 Rader. Such an outcome was not unforseeable. is in the public interest since it moves California utilities away from the “paralysis and backsliding on our 35 36 Borenstein. to ensure the maintenance and growth of this renewables base37. 1995 Rader. ERG Master’s Project Mark Stout 19 . in a speech before the California Manufacturers Association. with a mix of shortcomings and unexpected benefits in the legislation.”38 Some public interest advocates would argue that moving ahead with the deregulation process. 1996. endorsed in the CPUC Decision. said that the Legislature was going to. Large industrial customers are also likely to benefit disproportionately because of their ability to take advantage of contracts made directly with low cost electricity generators. this is difficult to say. with uncertain funding allocations that may not be able to support the existing base of California renewable energy generators. indicate that electric utility shareholders faired better in the negotiations than small consumers 36. AB 1890’s questionable protection against utility market power. including renewable energy and energy efficiency. An argument can be made that the final legislation will result in lower funding for public purpose programs. renewable energy concerns faired poorly in AB 1890. as well as the loss of a strong policy mechanism. Weeks before the passage of AB 1890. which may lead to higher electricity rates for small consumers purchasing out of a centralized Power Exchange envisioned by both the CPUC Decision and AB 1890 .substantial market power exists among California electric utilities35. than would have occurred under the CPUC’s December 1995 vision. AB 1890 author Jim Brulte. 1996 38 Asmus. “roll over renewables” and “roll over enviros. From some perspectives.

1997. 30% new technologies. 1997 41 Marshall. In March of 1997. 10% emerging technologies. including a prominent one authored by Representative Dan Schaefer (R-CO). The overall levels are: 45 % existing technologies.41 There are currently several electric utility restructuring bills in Congress.40 On May 6. 1997. “Primed for Congressional Battle” ERG Master’s Project Mark Stout 20 . the California PUC was on a clear course to abandon all [funding for public purpose programs] on grounds of lack of statutory authority. 1998. It divides up this amount into four accounts that vary over four years of funding. and 15% consumer-side incentives. 1996 CEC. including residential and small commercial consumers. “If the bill had failed. As Carter and Cavanagh have noted.42 This bill includes a "minimum renewable energy generation 39 40 Carter and Cavanagh. the CPUC and California Energy Commission (CEC) have been working towards the implementation of this legislation. 1997 42 Weisman.”39 Recent State and Federal Activity Since the signing of AB 1890 into law. chair of the House Energy and Power Subcommittee.environment/equity agenda” which had gripped the industry since the release of the Blue Book in 1994. the CEC released a report to the legislature with policy recommendations for the allocation of up to $540 million renewables funding codified in AB 1890. the CPUC released its latest restructuring decision which surprised stakeholders by announcing that all customers. would be eligible for direct access January 1.

”46 In California. Many forces have come together to create the push for electric utility deregulation in California. There is literally no profit in it for them. Because the PUCs determine the rates.44 Factors Behind the Drive for Deregulation Now that I have reviewed the history of Federal and state electric utility regulation. too conservative.43 The Department of Energy (DOE) has also been circulating a draft bill that includes a Renewables Portfolio Standard. It has an incentive to build a new plant even if it is not really needed. ERG Master’s Project Mark Stout 21 . The state commissions typically calculate a company’s profits as a return on investment. 1997. and future expansion. 355. 1997.requirement".” Barbara Barkovich. a consultant representing CLECA explains their 43 44 Levison. and overcapitalized due to state regulation. services.. Retail wheeling sits at the top of the agenda of this coalition of steel. it is time to gain a fuller understanding of why California has proceeded down the path towards deregulation.45 Large Consumer Pressure Large industrial energy consumers have the most to gain from the lower electricity prices that may accompany greater industry competition. the companies have no incentive to be efficient. and one of the largest gold mining firms in the world. Therefore. “Discretionary Evolution. “DOE Restructuring Bill” 45 Stevenson. cement. these concerns are represented by the California Large Energy Consumers Association (CLECA). if a company wants more revenue it must invest more capital.. “Restructuring Hearings on the Road” Levison. “12 companies--most foreign-owned--that really soak up the juice.”. Davis explains their reasoning: “the electric companies are inefficient.

viewpoint. Asmus. 24 companies that account of over 4% of the nation’s electricity use. are now competitive.. The California Air Resources Board’s old tailpipe emissions standards for new cars and light-duty trucks sold in that state were adopted by Congress in 1990 as the standard to be met by all new vehicles. such as wind power.” to existing public interest programs.. on the other hand. and they say they know renewables. “Balancing the demand for federal standards with the urgent need to reduce emissions in California was one of the primary challenges confronting Congress and the executive branch.. As Davis notes. “In the past the commissions had found their main constituents to be residential customers. has no respect for the environment. If there are provisions for renewables and conservation here. “We just want to use competition to get the best price for power... John White.. “uncompromised as possible because they fear the California plan will become a model for the country.”. V. 24-25. Now they found 46 47 Davis. That’s one reason why they want to cut their own deals. 1995.” CLECA’s national counterpart is the Electricity Consumers Resource Council (ELCON). 192.” A consultant who shares White’s perception of ELCON notes that they want to push California to adopt a policy as. There are some who are concerned about ELCON’s environmental ethics in pursuing electric utility restructuring. ERG Master’s Project Mark Stout 22 . “At least you can talk to CLECA.”47 The Clean Air Act amendments of 1990 set a precedent for Federal legislation following California’s leadership on environmental programs. they will have to gulp and swallow elsewhere.”48 Davis describes the transition that has occurred in the influence of state PUCs. “We do not advocate a slash and burn approach. executive director of the Center for Energy Efficiency and Renewable Technologies remarks. “Retail wheeling. ELCON.

447-475.51 Academics & Ideologues Neo-classical economists have argued since the 1970’s for the deregulation of the electric utility industry. 1993. Hoffman 55-62. Davis. Advancements in transmission line technology now allow the efficient transmission of electricity for distances of hundreds of miles. 1994.. basing their arguments on welfare economics as applied to the changing electric utility landscape.. ”49 Technology The development of gas turbine generation technology has greatly reduced the scale requirements for efficient electricity generation.”.50 Economic Rent The potential to capture higher profits offers a significant incentive for well-positioned electric utilities to pursue an end to price controls and enhanced opportunities to sell excess power outside of their service area. Gordon.52 The “new industrial organization” espoused by these economists has served as 48 49 Davis. enabling increased competition. ERG Master’s Project Mark Stout 23 . 1993. 150. This reduction in scale has brought down the capital requirements of entering the electricity generation industry. 195. 50 Flavin and Lenssen. 356-357. 51 Stevenson. 52 Gilbert. greatly increasing opportunities for bulk power sales.intense pressure from large industrial customers. who in the past had enjoyed privileged status with cheap rates. 84-108. “Discretionary Evolution. but now had to pay higher rates.

allowing frequent comparisons between the California Blue Book’s proposed wholesale pool and a similar pool already implemented in the UK. 55 Flavin and Lenssen..53 allowing a policy trend that emphasizes markets rather than social welfare.”. “Discretionary Evolution. “With this act. ERG Master’s Project Mark Stout 24 . as well as those on the border of service districts.. “Discretionary Evolution.55 Other Industries and Countries The deregulation of the telecommunications and natural gas industries serves as an analogy to the potential for electric utility deregulation. Stevenson. such as natural gas for space heating.”.. 1994. generating capacity has been supplied by alternative. 357.56 Federal Regulatory Policy By requiring utilities to pay avoided costs to the new class of qualifying facilities. the camel of competition forced its nose under the monopoly tent. over half of new U.54 Since 1992.. competition takes on several forms in this market. Utilities compete for industrial customers who are relocating.the academic rationale for the recent flurry of deregulation activity being pushed by free-market ideology. 355-356.S. Existing Competitive Forces Although electric utilities are often viewed as pure monopolies. non-utility providers. Examples of national electric utility deregulation have already been provided by the United Kingdom and Norway. and it was only 53 54 Stevenson. the 1978 Public Utility Regulatory Policies Act greatly invigorated the wholesale market for electric power. There is significant competition in the wholesale electric generation market. Many electrical applications have substitutable fuels.

78. Cook. “Restructuring Goes on the Road” ERG Master’s Project Mark Stout 25 . the product of President Carter and the Democratic Congress.”57 The qualifying facility clause of PURPA was originally intended to encourage generation resource diversity.a matter of time before it worked its way inside. 58 Davis. 1997. creating new classes of larger non-utility generators. The resulting testimony convinced Schaefer that the current monopoly system is harming consumers. A recent announcement from Representative Schaefer’s office reads. 1. The recent restructuring bills in Congress have given incentives to state governments to act. Schaefer held nine legislative hearings and heard from dozens of witnesses on the issue of breaking up the electricity monopoly. including the Exempt Wholesale Generator. FERC vigorously supported competition for electricity.”59 As one environmental representative 56 57 POWER Working Group. a policy it had already implemented in its natural gas decisions. Under Chairman Martha Hesse in the late 1980s. 59 Levison.”58 The Energy Policy Act of 1992 built on this competitive momentum. Federal legislation could force states into retail competition on a set timetable. 2000. and deleting portions of the Public Utility Holding Company act to facilitate establishment of EWG/IPPaffiliates by regulated utilities. “Ironically. “During the 105th Congress. in order that they maintain control of the regulatory process at the state level. by requiring that utilities provide non-discriminatory transmission access for wholesale transactions. Davis notes that it became used as a tool to inject competition into a regulated system. He has since introduced legislation (HR 655) that will give all consumers choice of their electric provider by December 15. 195. the ascension of Reagan administration advocates of competition amplified the effect of PURPA.

according to Jeff Dassovich. 1997. “Retail wheeling. New York. Michigan initiated a five year retail wheeling experiment involving two utilities. They “became increasingly perplexed about the arcaneness and gridlock that seemed to pervade the utility resource planning process. a proceeding in which the Commission attempts to determine how much capacity will be needed and structures the acquisition process in great detail. ERG Master’s Project Mark Stout 26 .”60 State Regulatory Policy Bidding programs for wholesale electric generation have been established in California. Dassovich explained that they were frustrated with the “myriad of complex and controversial balancing accounts and rate adjustment mechanisms they had to contend with every 12 months” as part of the rate-making process. 1995. Maine... 60 61 Levison. were the key retail wheeling champions within the CPUC... both appointees of Governor Pete Wilson. “the DOE bill does not mandate retail markets by any date certain. the same year that California’s Blue Book proposal was released.”62 a form of integrated resource planning know as the BRPU. Connecticut.61 California Public Utility Commissioners Jesse Knight and Norm Shumway. 62 Asmus.63 This move towards greater reliance on the marketplace to make supply decisions is clearly in line with the free-market ideologies of the Republican Governor. Calls for bids have often been oversubscribed by a wide margin. “Discretionary Evolution. Commissioner Knight.has noted. 24. though it urges states to consider retail competition. “DOE Restructuring Bill” Stevenson. In 1994. an analyst with CPUC’s Division of Strategic Planning. and Wisconsin.”. One of the stated proposals of the Blue Book is to eliminate the Biennial Resource Planning Update (BRPU). Colorado. Massachusetts. 355-356.”.

65 Analysis The California electric utility deregulation experience has often been described as a stakeholder-driven process. As a staffperson for a prominent officeholder noted during our interview. I decided it would be insightful to interview people who represented stakeholder organizations that were active in the process. “There was not enough education or public involvement. Based on my experience as a representative for an environmental organization. writes. letter to the editor. nineteen state legislatures have reviewed bills in response to the potential for greater competition in the electric utility industry. as well as the staff of the officeholders they were trying to influence. Jesse J. Knight. it was clear that the general public was not very involved in the process. Wall Street Journal.”64 As of October. ERG Master’s Project Mark Stout 27 . as well as interviews for this analysis. Many of the outcomes of the deregulation policy formulation were a result of negotiations between organizations representing different stakeholder groups. “Freeing Californians from the monopoly grip of the utilities and granting consumers direct access to competitive power suppliers will greatly benefit the state’s economy and enhance the quality of life in my state. As it was too esoteric a topic.in a fit of political posturing.. in that not all interest groups who might be impacted by the process participated in the 63 64 CPUC Blue Book.” [see Anonymous Officeholder Staff Interview #1] Because of this stakeholder-representative orientation. including authorizations for legislative and regulatory study committees as well as direct access for certain customers to alternative generators. There are limits to this approach. 1995. October 9. 32. A15(Western). 1995. so there was not enough press coverage.

and who prevails in decision-making.negotiations. presumably people participate in those areas they care about the most. observable actions between participants. 1974. Lukes has argued that there are three views or dimensions of power. who gains and loses.”66 By talking with active stakeholder representatives and officeholder staff. on Lukes’ “second face” of power. I primarily focused on Lukes’ first dimension of power. 3-32 ERG Master’s Project Mark Stout 28 . Goventa. “who participates. Unfortunately. power may be analyzed by looking at. eloquently expressed by their participation. “by which power is exercised not just upon participants within the decision making process but also towards the exclusion of certain participants and issues altogether. 1980. most “radical” view of power.. 2. The officeholder staff were also able to add insight on who was able to set the terms of the debate (who decided which issues were excluded).” In Lukes’ third. cannot. opening up the analysis to the second view of power. As Polsby has written. Lukes. Their values. shaping. p.. even without observable actions or non-actions by that institutions agents. two-dimensional view of power accounts for the development of a “mobilization of bias” explaining how a political institution can systemicly be biased towards a particular outcome. be more effectively objectified. but only at a superficial level. it seems to me. he argues. “A may exercise power over B by getting him to do what he does not want to do.” Lukes’ second. or determining his very wants... His onedimensional view of power is based around observable actions by stakeholders. but he also exercises power by influencing. in a contradiction between the interests of those exercising power and the real interests of those they exclude. these interviews do not shed much light on the 65 66 Sikkema. As Goventa comments.

I chose these categories based on personal experience representing a stakeholder organization in the process. their comments on restructuring filed with the CPUC69.. Status Report. as well as considering those used in a status report from the CPUC to the Legislature.68 I have broken oil and natural gas companies out as a separate category in the tabulations of campaign contributions. talking with at least one prominent representative from a number of categories: investor-owned electric utilities. CPUC. large electricity consumers. ERG Master’s Project Mark Stout 29 .. utility labor unions. 1995. 1995.exercise of power from Lukes’ most “radical” view. one important subcategory emerged because of its dominance: Oil and natural gas companies are often both large energy consumers. municipal electric utilities. Status Report. I first review what the different stakeholder groups wanted and got in both policy outcomes. Status Report. 67 68 CPUC. 1995.. small electricity consumers. and the final AB 1890 language. Selection of Stakeholder Groups In selecting stakeholder groups to focus on..67 As I extended my analysis with a summary of campaign contributions from stakeholders to the conference committee members. Overview of What the Stakeholders Wanted and What They Got Before analyzing who got what they wanted. independent producers. as well as independent producers. since such a broad analysis would be outside of the scope of this project. and a state institutions. the December.. 1995 CPUC Decision. based on 26 stakeholder interviews [see Appendix B].. environmental advocates. 69 CPUC. I tried to cover as wide a range of participants as possible.

• AB 1890 outcome: The legislation codified the utilities opportunity to recover 100% of stranded costs.” The inclusion of direct access was not embraced by munis. and pursue 100% stranded cost recovery from ratepayers. including billions of dollars in rate settlements for PG&E’s Diablo Canyon and SCE’s SONGS nuclear plants. who are also their “shareholders”. While recovery period is limited to four years may limit their ability to achieve the full 100% cost recovery. • December Decision outcome: The IOUs did get the ability to recover 100% of stranded costs. except for on the subject of reciprocity for allowing direct access. • December Decision outcome: The CPUC Decision did not address municipal utilities. where there was considerable support for staying clear of muni autonomy: “We have previously acknowledged that we do not have the authority to impose our vision on municipal or public power entities. ERG Master’s Project Mark Stout 30 .• Investor Owned Utilities: The IOUs want to protect shareholders by maintaining their stock price and maximizing profits. Most resist retail competition. A five year phase-in to direct access may have been a little too fast for Edison. while ensuring their financial solvency. • Municipal Utilities: The munis want to retain their autonomy in making their own policy decisions. they are comforted by a negotiated settlement that was reached to avoid future litigation. which was the strongest proponent of starting with a wholesale-only PoolCo proposal. Under legal mandates which we scrupulously respect the governance of these entities and their relation to their customers are committed to their duly constituted governing authorities. Most resist retail competition and pursue the ability to recover 100% of stranded costs from ratepayers.

while going further to directly support the goals of system reliability through adequate inspection and maintenance. Appendix B] The inclusion of direct access was not embraced by munis. • AB 1890 outcome: The legislation allows for the collection of IOU employee severance and retraining costs in the CTC. and pursue ratepayer support for worker severance payments and retraining. enhancing our stature at the federal level. As the lobbyist for the Sacramento Municipal Utility District points out. ERG Master’s Project Mark Stout 31 . leading to an overlap of their interests with public interests. AB 1890 also requires that IOU-divested generation plants come with two-year contracts for operation and maintenance by the existing staff. we can point to the legislation.• AB 1890 outcome: The municipal utilities lost autonomy in making decisions about direct access as a tradeoff to ensure their ability to collect stranded costs. They are strong proponents of maintaining system reliability as this requires adequate staffing. They resist retail competition.” [see interview. “If the IOUs do not respect the munis. An unexpected positive outcome was the improved leverage munis gained over IOUs. since AB 1890 required the munis and IOUs to work together on joint filings to FERC for the Power Exchange and ISO. • December Decision outcome: Although the Decision does allow for the collection of IOU employee severance and retraining costs in the CTC. • Utility Labor Unions: Unions would like to protect the income of their members while faced by a down-sizing industry. it does not focus on maintaining system reliability.

• Renewable Technology Independent Producers: As a subset of independent generators. protecting the sanctity of the QF contracts. it leaves these negotiations as voluntary. while having access to new customers made available to them. Direct access with community-based aggregation of load would help facilitate the development of bilateral “green” pricing contracts with residential customers. the renewables industry would like to rebound from difficult financial times many of them are facing due to the sunset or failure of previous policy support mechanisms. Short-run avoided cost (SRAC) payments to QFs are to be set to the market-clearing price in the Power Exchange.• Independent Producers: Independent generators want to protect the sanctity of their existing contracts. • December Decision outcome: Although the CPUC supports the renegotiation (buyout) of Standard Offer contracts with qualifying facilities. • AB 1890 outcome: The legislation nearly mirrors the CPUC Decision in terms of impacts on independent producers. although a lack of specificity in the policy language with regard to percentage levels for the minimum renewables purchase requirement was a cause for concern. Independent producers gain access to new customers through the adoption of direct access. As with non-renewable ERG Master’s Project Mark Stout 32 . They would like continued funding to reflect the public goods benefits offered by their technologies (such decreased air pollution). while having access to new customers willing to pay more for “green” power. resulting in generally higher prices paid to generators. • December Decision outcome: The CPUC’s endorsement of the Renewables Portfolio Standard was applauded by existing renewable energy generators. ensuring their continued financial well-being. Most are proponents of direct access.

competitive market possible to drive down rates. However. with one that had known costs. resulting in an industry shakeout. • Large Industrial & Agricultural Customers: The large consumers want the most efficient. allowing bilateral. SRAC set according to the Power Exchange market clearing price should result in higher payments to QFs under contract. As with non-renewable independent producers. IOUs still have the opportunity to collect 100% of their stranded costs. They support granting the IOUs less than 100% stranded cost recovery. As in the December Decision. • AB 1890 outcome: Again. and want a choice of their electricity supplier. direct access contracts.independent producers. Some argue that the level of funding is too low to maintain the current state renewables base and will end in 2002. this industries financial woes are not solely because of deregulation.25 years greatly increased large electricity consumers’ satisfaction with the deal. They lost out on rather generous terms for collection of stranded costs by the IOUs. SRAC set according to the Power Exchange market clearing price should result in higher payments to QFs under contract. the RPS. ERG Master’s Project Mark Stout 33 . large customers won on the inclusion of direct access. and AB 1890 does provide a significant amount of money to existing renewables developers to help mitigate any downsizing in the industry. renewables funding through a systems benefits charge. • AB 1890 outcome: Many renewables generators were disappointed with the replacement of a policy mechanism that had known outcomes. making them the strongest proponents of direct access. which could extend until 2005. • December Decision outcome: Large customers did get the market structure they desired. but limiting the competitive transition charge (CTC) cost recovery to 4.

Funding for low income programs was good. Small consumers benefited from the inclusion of language on community aggregation to allow residential customers some benefits from direct access. with no cap on low income rate assistance. want an equitable user class phase-in schedule for direct access. • December Decision outcome: Small consumer and low income advocates lost in their opposition to a market structure allowing direct access.• Small Consumers: Small consumer advocates want any restructuring that occurs to have net benefits for even the least well off individual. In principle. low-income weatherization) on an as-needed basis. and support community aggregation for residential ratepayers to take advantage of bilateral contracts with low cost generators. Language on consumer education and protection did not go far enough in addressing the needs of a deregulated market. the consumer education and protection language was well received. although more specific details were required. as well as in their opposition to 100% stranded cost recovery by the IOUs. Low income consumer advocates want IOUs to continue their low income assistance programs (baseline rate. • AB 1890 outcome: As in the CPUC Decision. as well as in their opposition to 100% stranded cost recovery by the IOUs. although the anti-slamming language in the bill may make this unworkable if it is not fixed in this session’s cleanup legislation. and have adequate customer education programs and protection from fraud put into place. with no cap on low income rate assistance. ERG Master’s Project Mark Stout 34 . Funding for low income programs was good. They resist retail competition. Small consumers benefited from the inclusion of language on community aggregation to allow residential customers some benefits from direct access. small consumer and low income advocates lost in their opposition to a market structure allowing direct access.

The rift in the community that had developed regarding renewables policy was only torn wider by renewables funding ERG Master’s Project Mark Stout 35 . Direct access threatens to undermine both IRP and sales volume/profit decoupling.• Environmental Organizations: Environmental organizations want the electric utility industry to evolve into a form which is environmentally and socially sustainable. DSM. as well as in their opposition to the tying of stranded cost recovery to continued operation of nuclear plants. although a lack of specific funding levels was troubling. They want the idea of leastcost planning through IRP to be protected. The inclusion of the Renewables Portfolio Standard was heralded as strong renewables policy by some environmentalists. Environmentalists would like to see an end to the backsliding that has occurred in utility energy efficiency and R&D budgets. Mechanisms that continue to decouple utility profits from volume sales are pursued because of the positive impact they have on demand side management efforts (DSM). These groups want to accelerate the removal of coal and nuclear plants from operation. • AB 1890 outcome: Environmental advocates lost in their opposition to a market structure allowing direct access. The application of a public goods charge to pay for energy efficiency and public interest RD&D was good in principle. and public interest RD&D. as well as in their opposition to the tying of stranded cost recovery to continued operation of nuclear plants. Most groups resist retail competition and support continued funding for new renewables. There is a significant rift that has developed over whether existing renewables generators should continue to receive subsidies. • December Decision outcome: Environmental advocates lost in their opposition to a market structure allowing direct access. while others perceived it as continued charity for poorly-run businesses that had already received more than adequate support.

grouping the stakeholder interviews into categories allowed some overall patterns to emerge from this set of data. by category. and the small number of organizations per category. the following cluster analysis should only be used to point out rough trends. The organizations represented by each interview is listed. municipal electric utilities. Stakeholder Interviews Cluster Analysis Given the large amount of interview data to absorb from 26 stakeholder interviews. environmental advocates. The application of a public goods charge with statutory spending level floors for energy efficiency. large electricity consumers. The raw coded data for this analysis is included in Appendix D. I used my original categories for this cluster analysis: investorowned electric utilities. and a state institutions. independent producers. but there is ongoing debate as to whether the adopted levels represented too much of a compromise with more powerful players. utility labor unions. Appendix B has a full transcript of each interview. and low income programs was well received. renewable energy. Because of the time-intensive nature of this research. combined with limited time and resources available. public interest RD&D. in the table of contents for Appendix B. This clustering also allowed for a better correlation with a review of the officeholder staff comments. ERG Master’s Project Mark Stout 36 . small electricity consumers. each clustered category has a small number of organizations.levels that may not support the existing base of generators while allowing some new development to be placed on line. Because of the subjective interpretations required to code qualitative interview responses.

and the remaining minority claim that their organization got rather little. When combined with comments filed by that organization early in the restructuring process at the CPUC. Figure 1: How much of what your organization wanted was in the CPUC December Decision? Rather Little Figure 2: How much of what your organization wanted was in the December Decision? STATE INSTITUTIONS ENVIRONMENTAL ADVOCATES Most SMALL ELECTRICITY CONSUMERS LARGE ELECTRICITY CONSUMERS Rather Little Mixed/Unclear Most Mixed/Unclear INDEPENDENT PRODUCERS UTILITY LABOR UNIONS The stakeholder representatives MUNICIPAL ELECTRIC UTILITIES were then asked how much of what their organization wanted was included in the CPUC December. As INVESTOR-OWNED ELECTRIC UTILITIES 0 1 2 3 4 5 Figure 1 indicates. this provides a baseline to determine if they got what they wanted. a slightly smaller number of representatives report a mixed or unclear outcome. Figure 2 shows that all of the investor-owned utilities and independent producers. nearly half of the representatives say that their organization got most of what it wanted from the December Decision. say that their organizations got most of what they wanted ERG Master’s Project Mark Stout 37 .The stakeholder representatives were asked what outcomes their organizations wanted to obtain from the California electric utility restructuring process as it was just unfolding. as well as the majority of large electricity consumers. 1995 Decision.

The utility labor unions and municipal utilities representatives reported receiving relatively little from this policy outcome. ERG Master’s Project Mark Stout 38 . and the remaining minority claim that their organization got rather little. nearly half of the representatives say that their Rather Little Figure 3: How much of what your organization wanted was in AB 1890? organization got most of what it wanted from AB 1890. a similar number of representatives report a mixed or unclear outcome. as well as the majority of large electricity consumers. say that their organizations got most of what they wanted from AB 1890. The small consumer and environmental organization representatives appear to have taken a step backwards in terms of getting what they wanted compared to the CPUC December Decision policy outcome. Figure 4 shows that all of the investor-owned utilities and utility labor union Mixed/Unclear Most representatives. The stakeholder representatives were also asked how much of what their organization wanted was included in AB 1890.from the December Decision. As Figures 3 indicates.

Figure 6 shows that the only organizations interviewed that prefer the December Decision are among the environmental and UTILITY LABOR UNIONS MUNICIPAL ELECTRIC UTILITIES INVESTOR-OWNED ELECTRIC UTILITIES independent power communities.Figure 4: How much of what your organization wanted was in AB 1890? One of the interview questions asked which policy outcome was STATE INSTITUTIONS ENVIRONMENTAL ADVOCATES preferred by the subject’s organization. most organizations preferred the INDEPENDENT PRODUCERS SMALL ELECTRICITY CONSUMERS LARGE ELECTRICITY CONSUMERS Rather Little Mixed/Unclear Most language of AB 1890. As Figures 5 indicates. either the CPUC December Decision or AB 1890. It is 0 1 2 3 4 5 clear from the interview transcripts Figure 5: What Policy Outcome Does Your Organization Prefer? No preference / Unclear CPUC December Decision that those few organizations that stated a preference for the December Decision did so based on their support Portfolio selected for the Renewables that was Standard by the Commissioners as a renewables AB 1890 policy. as opposed to the nonbypassable surcharge funding mechanism adopted in AB 1890 ERG Master’s Project Mark Stout 39 .

[see American Wind Energy Association. As excerpted from the PG&E stakeholder interview. I interviewed two subjects who were on the CPUC staff during the two years leading up to the December Decision. STATE INSTITUTIONS Figure 6: What Policy Outcome Does Your Organization Prefer? “Although the CPUC Decision was financially easier on PG&E. as well as three subjects ERG Master’s Project Mark Stout 40 . and Union of Concerned Scientists interviews].” Many of the other stakeholders consider AB 1890 an incremental. forward Decision. and to begin to build theories for why. PG&E and SDG&E indicated that part of their preference for AB 1890 was to avoid future litigation. Natural Resources Defense Council #1. evolutionary the step INVESTOROWNED ELECTRIC UTILITIES 0 1 2 3 4 5 ENVIRONMENTAL ADVOCATES SMALL ELECTRICITY CONSUMERS LARGE ELECTRICITY CONSUMERS CPUC December Decision AB 1890 No preference / Unclear INDEPENDENT PRODUCERS UTILITY LABOR UNIONS MUNICIPAL ELECTRIC UTILITIES from December Officeholder Staff Interviews Officeholder staff interviews are another data source that I now use to cross-check the previous cluster analysis on who did and did not get what they wanted out of the restructuring process. restructuring as envisioned in the CPUC Decision would have been less likely to take place in an orderly manner due to legal wrangling and ongoing filings at the CPUC.

resulting in a partial phase in of Direct Access. who was also the President of CMA at one time... Large businesses articulated the issues. Coalitions were very important.. He alludes to the financial resources required to fly in these business circles. they were able to then get retailers and agricultural groups on board.. PG&E’s President.. As a member of CMA’s energy group ($10 thousand membership fee). It was conspicuous that an Edison employee always traveled with President Fessler on his trips to Europe. and Edison set the ERG Master’s Project Mark Stout 41 . resulting in the most influential stakeholders being granted the most access. The following are excerpts from the full interview transcripts in Appendix C.who were staff for members of the legislative Conference Committee during the 1996 legislative session. A connection is made with obtaining the Governor’s buy-in. CMA’s energy committee got parties together. Large customers were less influential.... CMA.. This offered a substantial opportunity for access. WSPA made an effort to politically educate officeholders. so that the [legislative] Members and Governor bought in that restructuring would be good for California businesses.. The allusion to lobbying (“politically educate”) is joined with a theme of officeholder resonance to a pro-business message (“good for California businesses”): CMA and CLECA jointly made utility restructuring the issue for business. were the focus of this staffer from Senator Peace’s office. The level of influence on AB 1890 was a function of who was in the Conference Committee hearing room. The Memorandum of Understanding was a major event that brought together two worlds. particularly by negotiating a deal between them.. There was a lot of lobbying. IOUs and large customers. 1995. mostly focusing on market structure. with no ex parte rules during the pure rule-making period before December 20. Officeholder Staff Comments on Who Got What They Wanted and Why: • This CPUC staffer points to IOUs and large customers as wielding the most influence in the CPUC process. Lobbying access is only as good as a Commissioner’s willingness to meet.. who then initiated the “very important” MOU process. The preferential access to Commissioners also stands out: IOUs were most influential.” • Large industrial customers. networking with utilities. Stan Skinner.. The MOU process was very important because fighting parties came to an agreement. CLECA. was personally engaged.

says this anonymous staffer. Linking up with the Governor’s office was critical. Once again. • A staffer from Senator Byron Sher’s office highlights the ideological CPUC appointments by Governor Pete Wilson as drivers for the process. anywhere. Renewables and energy efficiency were also guaranteed protection. no one was happy. Mark Timmerman [CMA]. because of their financial resources can buy three things: lobbying of politicians. Many stakeholder interviews also alluded to the fear that a lack of legislation would result in a worse fate defined by the CPUC: The PUC laid out the framework for restructuring in the Blue Book.tone. It would not have happened without DJ Smith [CLECA]. who were afforded protection by Senator Sher. • The large customers and IOUs were able to get what they want again. and Bob Foster [Edison]. based on the free market-driven ideologues on the Commission. They were a guiding light. When the PUC December Decision came out. campaign contributions. and staff time to network anytime. and access to the Governor’s office: The IOUs were able to pull people together.. A lot of their lawyers did technical language work in coalition with the legislative counsel. They also were able to offer a lot of help with technical drafting. the IOUs are pointed out for their influence in shaping the agenda. they had the manpower to make sure their positions were taken care of. This had to be shaped by pressures on the Legislature. This was the greatest expression of coalition building. encouraging other people to accept the process who otherwise would not have. as well as an acceleration of recovery. a long-time defender of environmental interests. but this time they are joined by clean power interests. The Decision by the PUC was going to be implemented unless the Legislature was able to deliver a package... The momentum created by the Governor’s office initiating the MOU process is noted once again: ERG Master’s Project Mark Stout 42 . legal expertise.. • The IOUs’ were able to get what they want. This put everything on the table. The utilities established early on the full reimbursement for stranded costs. through networking resources. according to this staffer from then-Senator Bill Leonard’s office. IOUs very quickly were able to get 100% stranded cost recovery firmed up.

and Why: A familiar pattern emerges from these staff comments. The Governor has the same goal: empower people for economic development.Large customers and the utilities both had the most money to spend... • Another anonymous staffer focuses on the usual suspects. He gives several reasons for their influence. Ann sat down and read from the draft during the conference committee. Between the large manufacturers and utilities. Once the Governor’s office was behind the MOU. such as irrigation districts and economic development rates.. The ability to fund politicians helped.. and legal expertise: IOUs and large consumers got everything they wanted. This was the first time for the Members to be looking at actual language. including connecting with a free-market Governor.. If you had the resources to be there. but the resources that could be allocated.. you can be part of the decision making process.. Political clout can be bought with lobbying and campaign contributions. while the large customers got the ability to go first on direct access. These influential players relied on a “fairness and competition” argument.. This had validity for Committee Members. and look for ways to get around paying the CTC. ERG Master’s Project Mark Stout 43 . This supports the findings of the stakeholder cluster analysis. as well as their ideological resonance with a conservative Governor’s office. The IOUs got complete stranded cost recovery. But it was not the number of people in the room that mattered. in the coffee shops at three AM. IOUs and large consumers. Synthesis of Stakeholder & Staff Comments on Who Prevailed. except that the labor unions which appear to fare well in the earlier analysis are not called out in any of the officeholder staff interviews. oftentimes because of superior staff and financial resources. ability to marshal staff resources. Ann wrote it and brought it to the Committee for consideration.... IOUs and large customers are often cited as victors. Senior Legal Counsel for Edison.. they accounted for 2/3 of the people in the hearing room. A key witness before the Committee was Ann Cohn. it was all over. The Committee staff did not write the first draft of the bill. who deal daily with issues of economic development.

CalPIRG and some other consumer advocacy groups criticized the process without participating. small consumers are the recipients of a bogus rate-cut that they are self-financing: Low income advocacy groups did not make their issues big and high-profile like structural issues became. and Why: • Low income organizations and the renewables community could have improved their performance... He also touched on the un-level playing field created by a free-market ideologue Governor: The environmental and renewables communities made the Committee punt. They waited until late in the process to get organized. • A staffer from Senator Byron Sher’s office also brought up the municipal utilities. In AB 1890. but did not do hall walking to the extent of other groups... The 10% rate reduction for small customers was final packaging to sell the bill for voters. • The clean power community’s inability to resolve differences between them has hampered their abilities according to a staffer from Senator Steve Peace’s office. for their inability to articulate positions. . This was very irresponsible. yet were not in the hearing for one minute.. they had full opportunity. The low income groups participated on paper through filed comments. They did not want to participate.. and the renewables community was perceived as not being able to make a paradigm shift..... could not address the problem of a competitive market and participation. .. The clean power community was cited again for a lack of ERG Master’s Project Mark Stout 44 . LADWP was trying to cause trouble with restructuring. but for different reasons.Officeholder Staff Comments on Who Got Rolled Over. He also chided municipal utilities and some small consumer advocates for resisting the process and not fully participating.. The rate reduction bonds may not yield net present value benefits. The renewables players were probably asking for too much of the old world the PUC had engaged in.The big mistake for these small consumer groups was letting Pete Wilson get elected and stack the PUC with right wing ideologues. The low income groups may not have the staff resources to lobby effectively. but just result in rate deferrals for 10 years. as rates were supposed to come down due to the QF cliffs anyway. according to this CPUC staffer. These groups could not come to a resolution. The California Municipal Utilities Association folks lacked effectiveness also.

. The environmental and consumer advocates did not have a clear idea of what they wanted. There was not enough education or public involvement.. environmental and small consumer’s initial resistance to deregulation hindered their ability to articulate positions in the new environment: The renewables community fractured itself as far as coming together behind a proposal. caused them problems. anyone could have influence. Finally. It was very unhelpful to have put themselves in that position. they were all against restructuring. The munis had a hard time articulating how to maintain an exit fee [for direct access customers leaving their electricity procurement service] without joining the ISO. in this anonymous staff comment. due to the Governor and his CPUC appointees. Large. and pay attention to it then. Small consumer advocates and brokers did not participate in a timely manner. Later on in the Committee. As it was too esoteric a topic. not after the fact. the playing field was tilted. such as CalPIRG and one of Ralph Nader’s organizations. When the train was leaving the station. Groups that opposed the bill without participating also were ineffective. so there was not enough press coverage. It had too many purists that need to learn the art of compromise. This schism was a recipe for having the least influence. At first. they did not know what seat they wanted to sit in. This dissipated their effectiveness. They needed to realize the process was happening.. ERG Master’s Project Mark Stout 45 . He threw the munis out. and the much-maligned municipal utilities for an inability to articulate proposals. and they subsequently came around with an articulated position a day later. Peace was demanding in terms of defining your position. powerful interests already had an advantage from the PUC Decision. the residential ratepayers also had trouble.unity.. driven by an inability to compromise... • A staffer from then-Senator Bill Leonard’s office pointed to public interest organizations for opposition despite non-participation. To a lesser extent. Also. small customers and the people who serve small customers. the fact that the renewables and environmentalists were divided was damaging... If they were there and could contribute. which did not help.. Small consumer advocates faced an un-level playing field. • A lack of unity in the clean power community. echoing Senator Peace’s staffer quoted above: Early on the munis were not able to define a single coherent position or proposal..

and Why: A pattern consisting of three stakeholder groups who may not have received what they wanted emerges from the staff interview data. faced an un-level playing field all along. “Some volunteer leaders wanted to be more vocal on stranded costs. “insider” strategy: • A volunteer on the Sierra Club California Legislative Committee noted. in large part due to the free-market ideology of Governor Wilson’s office which has been passed down to the CPUC Commissioners over years of appointments.. The clean power community (renewables industry and environmentalists) were held back by a lack of unity in the face of more monolithic stakeholders. A careful examination of the interviews with stakeholder representatives for environmental organizations draws out two other factors that may have impaired these public interest groups. Things were changing too fast. This pattern of stakeholder groups is consistent with the results of the stakeholder cluster analysis. minimizing this group’s losses. The municipal utilities had trouble articulating proposed solutions to their concerns in the AB 1890 Conference Committee. We didn’t do grassroots letters. mice stay away’. Some public interest (small consumer/environmentalist) advocates were not in the game at all. there was not enough time. The clean power advocates..Synthesis of Stakeholder & Staff Comments on Who Got Rolled. leaving it up to the lobbyists and insiders to cut a deal. most of the environmental organizations did not expend much effort in using their grassroots activists to challenge the large customer groups and IOUs. The American Wind Energy Association and Environmental Defense Fund interview transcripts provide ample evidence of a rift in the community. but depended on a consensus-based. and were relegated to complaining after the deal was done.” ERG Master’s Project Mark Stout 46 . along with small consumer advocates. but we have learned ‘when elephants dance. First. but were able to recover when pressured by Steve Peace.

“Past EDF’s filing comments. the San Francisco Chronicle. If environmental groups collectively walked. In the end. we could have killed it. because he. not grassroots activists: “It was a consensus-based process. and the Sacramento Bee focusing on public purpose programs. it did become clear that NRDC’s strategy was based on coalitions of insiders.” Later in my interview with Ralph. NRDC’s relationship with the IOUs was important. not turning it into a media tank battle. 1997. there was not enough activity.70 [also see numerous comments in interview transcripts] An American Wind Energy Association representative was disheartened that Cavanagh would not pull NRDC’s endorsement for AB 1890.” 70 Weisman. largely because no public interest group was willing to oppose the bill. “wanted a win. but relied on their name instead.• A senior analyst for the Environmental Defense Fund comments on their participation in the CPUC process. one on one. NRDC had no media strategy.” • Ralph Cavanagh has served as a lightning rod for praise and criticism of the environmental community’s focus on an insider strategy. San Francisco Examiner. We were in constant contact. “NRDC did press work through editorial boards including the San Jose Mercury News. It was strong going in and going out of the process. We were on separate tracks with industrial customers to ensure no cost shifting occurred. AWEA endorsed the bill reported out of the conference committee. Critical stakeholders who could have derailed did not. The environmental groups and consumer groups such as TURN worked well together. didn’t want to ruffle any strategies. made no attempt to build clout. “Environmentalist Defends His Stance” ERG Master’s Project Mark Stout 47 .” • Cavanagh offers a different perspective on NRDC’s substantial media work.

or other mechanisms of power. big customers. AB 1890 was a deal cut in back rooms between powerful players. ‘Real’ consensus implies a prior process of agreement or choice. the use of threats or rumors.• A representative from a Latino advocacy group comments on NRDC’s consensus-based. IPPs.e. utilities.71 An attorney with the small consumer advocacy group.. taking care of small consumers would have led to compromise. “Latino Issues Forum did not actively participate..” One staff member at the CPUC gives some credit to NRDC’s insider strategy. even as it emerges.. nobody gave anything up. only a consistency that certain potentially key issues remain latent issues and that certain interests remain unrecognized--at certain times more than others. also questioned the validity of the “consensus” process during our interview. the ‘consensus’ could be maintained by power processes. which in a situation of apparent consensus may or may not have been the case.” Goventa has commented on the hazards of consensus-based processes for less powerful actors. etc. The process may not have occurred. i. The “consensus process” was just everybody taking. “Ralph Cavanagh was influential in making sure that public purpose programs stayed on the plate. Ralph Cavanagh carried our torch primarily. the powerful may be able to ensure that certain beliefs and actions emerge in one context while apparently contradictory grievances may be expressed in others. From this perspective.. a consistently expressed consensus is not required for the maintenance of dominant interests. such as public interest advocates confronting large corporate interests: . “If you can get all of the big dogs to reach consensus. Public purpose concerns become peripheral. The Utility Reform Network (TURN). 19+29 ERG Master’s Project Mark Stout 48 . like an armadillo in the middle of the road.” 71 Goventa. especially vulnerable to the manipulation of the power field around it. Critical consumer interests were not present. they just loaded up the plate. 1980. unions. may be malleable. Through the invocation of myths or symbols.the consciousness of the relatively powerless. it could have been shaped or manipulated. insider-coalition strategy. it is tough to stop the momentum.

The 3% [it was actually a cap of 3. The August 15 language from a coalition of powerful interests. CLECA. EDF.. less than two weeks before the Bill would be reported out of committee.” However. During the Conference Committee hearings. reduced funding to an average of 2. and the Sierra Club.1% of IOU revenues.. the public interest groups did not have much leverage to oppose the dissolution of this consensus since they did not have an engaged constituency of activists to back them up. a representative from the American Wind Energy Association argued that customers paying more on their electricity bills to support renewable energy should cause an impact in terms of more kWh of renewable energy produced. TURN was one of several public interest organizations who opposed the change. and energy efficiency.. These got translated into dollars. A legislative outcome related to “green” pricing for renewables provides another example of an ephemeral consensus.72 At this point late in the game. RD&D. As a Sierra Club California legislative chair recounts on meetings between CMA. Industrial Users.A prominent example of a failed consensus was the 11th hour changes to the funding levels that had been agreed to in the Memorandum of Understanding.. roughly $660 million a year for the IOUs alone] of utility revenues for public purpose programs in the MOU came out of these discussions. renewables with an incremental cost estimate from the BRPU. “We reached a consensus on. funding for public purpose programs: low income.3% of utility revenues. a perusal of legislative language that was proposed during the long. not simply subsidizing other consumers or increasing IOU shareholder profits 72 Confidential binder of proposed language and other stakeholder notes ERG Master’s Project Mark Stout 49 . agricultural consumers. hot days of August in the 1996 Conference Committee reveals that this “consensus” funding level took a large hit on August 15. including IEP.

the first imperative facing states in capitalist systems is what post-Marxists call “accumulation”. without making it at all clear if these voluntary contributions will actually decrease the amount the IOUs must contribute towards renewables support funding from their frozen revenues... 75 The state imperative of “accumulation” came up several times during interviews with officeholder staff. groups whose inclusion coincides with no imperative will not easily acquire the tangible goods they value. They may be allowed to participate in the policymaking process. then they are punished by “capital strike”. falling tax revenues.73 However.. the final language of AB 1890 allows IOU customers to voluntarily contribute money to support renewable development.influential players relied on a “fairness and competition” argument. and unpopularity in the eyes of the public.. She pointed out the public relations/marketing dilemma that would result if “green” customers found out they were having no real impact on increasing the use of renewable generation. recession. 1996 ERG Master’s Project Mark Stout 50 . receiving “symbolic rewards only”..74 Dryzek has voiced concern that by accepting a seat at government policymaking tables. section 381.. To the extent that public policy remains under the sway of state imperatives. one Senator’s Chief of Staff revealed. subdivision (e) 75 Dryzek. . As noted earlier. There was no significant opposition to this point during the hearing.” An anonymous staffer’s comment also resonated with this state imperative.. This had 73 74 California Senate TV video of August 10. “Large businesses articulated the issues. public interest organizations have been “co-opted or bought off cheaply”. As he explains. but outcomes will be systematically skewed against them. if they pursue antibusiness policies. “. so that the [legislative] Members and Governor bought in that restructuring would be good for California businesses. 1996 Conference Committee on Electric Restructuring AB 1890.for a static amount of renewables capacity. States simply must provide the conditions that facilitate capitalist investment and economic growth..

who deal daily with issues of economic development. During my experience representing an environmental stakeholder organization in this process. The democratic loss experienced by entry into the state can. the loss is harder to justify. “quit beating a dead horse. 1996 meeting. The Governor has the same goal: empower people for economic development. then. But if there are no instrumental benefits. the RPS is a “non-starter” because San Diego Gas and Electric (SDG&E) does not like it”... bottom-up manner: the group may have to develop a more hierarchical internal structure in order to produce a stable leadership which government officials will recognize and deal with. where he bullied advocates for the Renewables Portfolio Standard. We will 76 Dryzek. they may lose out altogether.validity for Committee Members. Peace was threatening to handle renewable energy policy himself. under the threat of retribution.” As Peace said himself during the Conference Committee’s August 10. it will not inure to your benefit for those differences to still exist on Monday. Inclusion in the life of the state is. “It was very clear that if everyone did not work together. be justified by the instrumental benefits thereby achieved. Dryzek also notes the impact that this “democratization as inclusion” has had on the ability of progressive organizations to function in a democratic. “For those of you who have intra-familial differences. and nobody would have been happy. I read accounts of public hearings chaired by Peace. and Senator Peace represents a district in the San Diego area. bought at the expense of relatively unrestricted democratic interplay in the oppositional public sphere.”. Senator Peace’s response to this policy mechanism was along the lines of..76 Another factor that impaired the public interest groups was that Conference Committee Chair Steve Peace was able to coerce these groups into accepting compromises they would not have otherwise. According to an NRDC analyst who was interviewed.. 1996 ERG Master’s Project Mark Stout 51 .

Gift information is also provided based on Statement of Economic Interest Forms filed at the Fair Political Practices Commission.start unilaterally resolving issues. The following campaign contribution summary tables were compiled from Officeholder. no attempt has been made at determining total annual contributions from all sources to each officeholder. these tables cover the years 1995 and 1996 for the author of AB 1890. Senator Peace implored all of the parties to become “enthusiastic advocates” for the package.. in terms of complicated problem area. Jim Brulte (R-Ontario). 1996 Conference Committee on Electric Restructuring ERG Master’s Project Mark Stout 52 .77 Restructuring Stakeholder Campaign Contribution/Gift Analysis One way to track influence of elected officials is to look at the organizations paying for their campaign expenses and providing them with gifts such as meals and trips. if there is something you can bring to the table. A full breakdown of contributions for each legislator is included in Appendix E. is clearly renewable folks. So for those of you who have been working on other issues I encourage you all to be helpful in that area if you can. Where data is available. even though there some parts they might hate... and my rule is when we are forced to unilaterally resolve issues. Candidate. in order to move forward with a product. obviously there is going to be many political philosophies on that issue.” That same hearing session. and the six members of the Conference Committee on Electric 77 California Senate TV video of August 10.. The other thing is. I’m sure there are lots of votes in the legislature that would just as soon do electric restructuring without a renewables component. everybody should suffer except for us. Because of the difficulty of tracking the transfers of funds between different office-holder controlled accounts. Our largest problem area. and Controlled Committee Campaign Statements filed at the California Secretary of State Political Reform Division. OK?.

Gregory Conlon.ca. or CIU member companies. Gift information is also compiled for the five Public Utility Commissioners presiding over the years 1994 and 1995 in Appendix E. These compilations do not provide comprehensive coverage for CLECA. Mickey Conroy (R-Orange). “California Lobbyists and Representatives in Energy-Related Legislation”. but rather include a sampling of member company contributions. Only donations from organizations involved as primary stakeholders in California’s electric utility deregulation are included. This web page78 was used as an additional check of which organizations have actively participated in influencing state energy legislation. reference titled. and Bill Leonard (R-Upland). and Steve Kuykendall (R-LA). CMA. and Henry Duque. The three Senators on the Committee were Steve Peace (D-El Cajon).. Norm Shumway. Byron Sher (D-Palo Alto). 78 http://www. The California Energy Commission has compiled a useful.html ERG Master’s Project Mark Stout 53 .gov/energy/cectext/lobbyist. Josiah Neeper. The three Assemblypersons were Diane Martinez (D-Alhambra). Governor Wilson’s five appointees are President Daniel Fessler. Campaign contribution totals for organizations include donations by employees and volunteer leadership. Jesse Knight Jr.Industry Restructuring. yet dated (12/18/95).energy.

101 $495 $10.149 $3.500 $190.745 $68.000 N/A $0 $18.000 $562.500 $533.835 $1.500 $263.559 $0 $246.000 $62.166 $5.031.758 $2.075 $4.181 $0 $160. Generating Company San Diego Gas and Electric/Enova Southern California Edison/Mission Energy/Edison International Southern California Gas/Pacific Enterprises MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association Imperial Irrigation District Modesto Irrigation District Northern California Power Agency Sacramento Municipal Utility District UTILITY LABOR UNIONS California State Association of Electrical Workers California State Pipe Trades Council PAC Int.500 $78.952 $1.S.000 $1.180 $0 $209.272 $0 $64.308 $516. (geothermal) California Solar Energy Industry Association Enron Capital & Trade Resources Independent Energy Producers Kenetech Windpower Modesto Energy Limited Partnership (tire burning) Pacific Lumber Company/MAXXAM (solid fuel biomass) SeaWest Energy Corporation (windpower) Solar Turbines Incorporated LARGE ELECTRICITY CONSUMERS Adams Steel Agricultural Energy Consumers Association California Cement Producers Association California Farm Bureau Federation California Industrial Users California Large Energy Consumers Association California Manufacturers Association California Mining Association PAC California Retailers Association California Steel Industries (CLECA member) Californians for Competitive Electricity Fontana Steel Kaiser Cement Corporation Louisiana Pacific (CMA member) Mitsubishi Cement (CLECA member) National Cement (CLECA member) Riverside Cement (CLECA member) Conference Committee Campaign Total California Contributions Lobbying Expenses $59.741 $21.000 $634.416 $5.818 $0 $65.419 $13.110 $34.000 $681.592 $846 $0 ERG Master's Project Mark Stout 54 .981 $1.000 $0 $70.079 $13.374 $1.995 $596.675 $384.608 $3.079 $950 $14.964 $0 $40.157 $0 $188.405 $0 $722.000 $225.370 $648 N/A $0 $208.1995 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear plants) Joint Electrical Industry Fund Pacific Gas & Electric/U.496 $8.096 $971.125 $0 $4.112 $3.239 $0 N/A $0 $89.500 $1.092 $3.595 $0 $21.516.153 $750 N/A $8.163 $0 $25. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.630 $300 N/A $0 $5.819 $0 $323.752 $0 $51.675 $736.102 $0 $73.203.479 $2.470 $10.000 $480.588 $500 $32.

362.203 $0 $30.000 $37.938 $0 $118.716 $39.947 $500 $281.665 $0 $262.000 $0 $6.167 $500 $25.230.500 $0 $0 ERG Master's Project Mark Stout 55 .145 $5.401 $1.000 $524.207 $5.081 $1.600 $32.197 $500 N/A $2.850 $1. (gasoline refining and marketing) Tower Energy Group (oil.271 $0 $12. (bulk terminals) Mobil Texaco Tidelands Oil Tosco Corp.492 $0 $66. diesel) Unocal (CMA member) Western States Petroleum Association SMALL ELECTRICITY CONSUMERS Greenlining Institute The Utility Reform Network (TURN) Utility Consumer's Action Network (UCAN) ENERGY SERVICE COMPANIES (ESCOs) Appliance Recycling Centers of America ENVIRONMENTAL ADVOCATES California League of Conservation Voters Center for Energy Efficiency and Renewable Technologies Environmental Defense Fund Natural Resources Defense Council Planning and Conservation League Sierra Club California Union of Concerned Scientists STATE INSTITUTIONS Note: N/A = not available Conference Committee Campaign Total California Contributions Lobbying Expenses $0 $4.000 $526.1995 Lobbying Totals RMC Lonestar (CLECA member) Southwest Portland Cement Co. natural gas.400 $100 $79.000 $0 $171.495 $1.003.000 $383.495 $27.291 $3.250 $0 $30.203 $5.723 $0 $38.319 $0 $10.675 $0 $1. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO California Independent Oil Marketers Association California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Exxon Kaiser International Corp.083 $0 $20.519 $11.326 $0 $100.000 $20.596.099 $12.600 N/A $5.000 $0 $15.551 $12.701 $0 $5.055 $0 $151.

250 $148.000 $33. Dist.229 $100 N/A $1.200 $837.000 NA $500 $0 $2.460 $50. EVs) Enron Corporation (gas fired) GWF Power Systems (oil and coal-fired) Hansen.281 $1.1996 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Electric Power Research Institute General Electric (nuclear plants) Pacific Gas & Electric/U. (gas-fired) American Wind Energy Association Bechtel (gas-fired) Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co. and Hamrin.100 $144. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades United Assoc. (geothermal) California Cogeneration Council California Solar Energy Industry Association Cannon Energy (windpower) Colmac Energy Inc.543 $29.500 N/A ERG Master's Project Mark Stout 56 .000 N/A $100 N/A $7.118 $0 $144.400 $1. (biomass) Destec (gas-fired) Edson + Modisette (lobbyist for indep.195 $401.782 $981.000 $35. Generating Company San Diego Gas and Electric/Enova Southern California Edison/Mission Energy/Edison International Southern California Gas/Pacific Enterprises MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association Gualco Group (lobbyist: Imperial & Modesto Irigatn.S.917 $300 $5.000 $209.) Imperial Irrigation District Modesto Irrigation District Northern California Power Agency Sacramento Municipal Utility District Turlock Irrigation District UTILITY LABOR UNIONS California State Association of Electrical Workers California State Pipe Trades Council PAC Int.179 $0 $3. McQuat.159 $3.000 $50.626 $0 $8.571 $500 N/A $200 N/A $1.147 $500 $739.025.589 $26. Inc (consultants) Independent Energy Producers Kenetech Windpower Modesto Energy Limited Partnership (tire burning) Pacific Lumber Company/MAXXAM (solid fuel biomass) SeaWest Windpower Sithe Energies Co.611 $1.500 N/A $0 $211.724 $500 not applicable $500 $57.331 $0 $97.717 $500 not applicable $0 $138.905 $30. (member of IPPs of NY) United American Energy Wadham Energy Limited Partnership (biomass) Zond Windpower Conference Committee Total California Campaign Lobbying Expenses Contributions (Jan-Sept) $145.882 $15. producers.748 $32.000 $85.450 $566.845 $452.500 $29.590 $5.454 $3.750 $1.060 $6.750 $267. of Jrnymn & Aprt Underground Utility/Landscape Utility Workers Union of America INDEPENDENT PRODUCERS AES Pacific/SF Energy Co.819 $921.605 $250 N/A $1.286 $3.240 $0 $178.017 $1.600 $276.032 $0 $172.862 $21.100 $0 $500 N/A $100 $0 $500 N/A $2.750 $418.250 N/A $100 N/A $2.

761 $0 $73.712 $100 N/A $200 $16.622 $67.643 $1.754 $4.000 $65.925 $0 $44. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO California Independent Oil Marketers Association California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Exxon Mobil Southern Counties Oil Co.689 $2.885 $300 $207.478. natural gas.780 ERG Master's Project Mark Stout 57 .000 $22.500 $47.750 $37.438 $500 N/A $0 $1. (CLECA member) California Retailers Association California Steel Industries (CLECA member) Californians for Competitive Electricity Fontana Steel Kaiser Aluminum Kaiser Cement Corporation Louisiana Pacific (CMA member) Mitsubishi Cement (CLECA member) National Cement (CLECA member) Riverside Cement (CLECA member) RMC Lonestar (CLECA member) Schnitzer Steel Industries (CLECA member) Southwest Portland Cement Co.1996 Lobbying Totals LARGE ELECTRICITY CONSUMERS Adams Steel Agricultural Energy Consumers Association California Cement Producers Association California Farm Bureau Federation California Industrial Users California Large Energy Consumers Association California Manufacturers Association California Mining Association PAC California Portland Cement Co.861 $1.521 $14. Western States Petroleum Association SMALL ELECTRICITY CONSUMERS California Nevada Community Action Association Greenlining Institute The Utility Reform Network (TURN) Utility Consumer's Action Network (UCAN) Conference Committee Total California Campaign Lobbying Expenses Contributions (Jan-Sept) $41.250 $34.750 $23.521 $1.500 $277.521 $0 N/A $50 $87.511 $1.016 $1.900 $0 $21.384 $2.000 $76.347 $9.181 $1.138 $1.636 $0 $103.245 $335.417 $9.500 $251.950 $3.000 $500 $456.721 $748. Texaco Tidelands Oil Tosco Corp.296 $800 $25.000 $233.334 $498 $1.209.995 N/A $100 N/A $0 $3.661.050 N/A $0 $214.573 $2.407 $200 $61.705 $19.495 $22. (gasoline refining and marketing) Tower Energy Group (oil.800 not tracked $3.958 $2.050 $949. diesel) Unocal (CMA member) Victory Oil Co.090 $749 $38.900 $1.137 $550 N/A $5.650 $3.960 $2.532 $4.989 N/A $9.177 $300 N/A $0 $29.072 $918.878 $12.

378 $100 $21.790 $100 $14.068 $14.000 $700 $117.000 $900 N/A $400 N/A $500 N/A ERG Master's Project Mark Stout 58 .462 $500 $14.250 $21. of California.066 $500 N/A $250 N/A $22.438 $4.000 $2. California Institute for Energy Efficiency California Integrated Waste Management Board (biomass) Note: N/A = not available Conference Committee Total California Campaign Lobbying Expenses Contributions (Jan-Sept) $1.462 $208.448 $424.1996 Lobbying Totals ENERGY SERVICE COMPANIES (ESCOs) Appliance Recycling Centers of America Onsite Energy (energy service company) Preferred Energy Services (energy service company) ENVIRONMENTAL ADVOCATES California League of Conservation Voters Energy Foundation/The Tides Center Environmental Defense Fund Natural Resources Defense Council Planning and Conservation League Sierra Club California Union of Concerned Scientists STATE INSTITUTIONS U.585 $33.000 $15.066 $500 $21.

“though the CPUC had imposed a ban on communications regarding the Biennial Resource Plan Update (BRPU). and Inner Mongolia. as well as the legislator breakdown tables and gift descriptions in Appendix E show that IOUs and large consumers. their “Travel project to Europe on Electric Restructuring. CFEE is a “non-profit. Brussels. a clean power auction the CPUC repeatedly postponed upon the urging of the utility. and Privatization” took AB 1890 author Jim Brulte and Conference Committee 79 80 Asmus. One example of the type of access to officeholders that money can buy is the junkets run by the California Foundation on the Environment and the Economy. 4 Asmus. 4 ERG Master’s Project Mark Stout 59 .As one would imagine. and Paris. paying up to $7. an Edison lobbyist was added to the international travel party at the last minute. According to investigative writer Peter Asmus. alternative energy producers. 1996. the lobbying summary tables above. Shanghai. regulators. and small consumer groups. to meet with CEOs of the electricity industry. CFEE took Fessler and Conference Committee Assemblyman Mickey Conroy on an 11 day trip to talk with Chinese central government and provincial leaders in Beijing.”80 In April of 1995. including oil and natural gas companies. government ministers. and environmental groups to discuss the British experience with deregulation of electricity.79 From 3/16/94 to 3/27/94.800 each. 1996. were able to far outspend environmental organizations (who were usually spread thin over many issues). Conservation.167 per guest. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure. for $7. From 3/28/96 to 4/8/96. CPUC President Fessler and Commissioner Gregory Conlon were taken by CFEE on an excursion visiting London.

and labor unions were the most influential in the deregulation process.490 per guest. Sweden. Because these stakeholder groups support the capitalist state imperative of wealth “accumulation”. state government archives. as well as their ideological resonance with a conservative Governor’s office. Based on interviews with officeholder staff and a cluster analysis of stakeholder interviews. and why or why not different groups were successful. in order to find out which stakeholder organizations got what they wanted from California’s electric utility deregulation policy formulation process. Conclusion This project synthesized data from several sources including semi-structured interviews with stakeholder representatives & officeholder staff. it appears the investor owned utilities. they are well suited for influencing inclusive. It is not so surprising that these “thousand pound gorillas” did well in the process. The clean power community (renewables industry and environmentalists) were held back by a lack of unity in the face of more monolithic stakeholders. These clean power advocates. and academic literature. Using the same officeholder staff interviews and stakeholder interview cluster analysis. such as the CPUC proceedings and legislative Conference Committee. large industrial customers. along with small ERG Master’s Project Mark Stout 60 . stakeholder-driven processes. and Budapest. my analysis uses patterns in the data to create emerging theories. This analysis generates the hypothesis that these parties were most influential because of superior staff and financial resources. Rather than attempting to verify a pre-determined hypothesis. at the mere cost of $7.Assemblymember Steve Kuykendall to London. several patterns emerged regarding which groups got far from all of what they wanted.

consumer advocates, faced an un-level playing field all along, in large part due to the free-market ideology of Governor Wilson’s office which has been passed down to the CPUC Commissioners over years of appointments. These stakeholder organizations do not have the financial resources to support the level of policy staff, legal experts, and lobbyists that the larger commercial interests were able to bring to bear in order to gain and maintain access to decision-makers. Because they do not represent capitalist state imperatives, these alternative energy industry and public-interest organizations should not find inclusive, stake-holder driven processes such as California electric utility deregulation to be particularly fruitful for obtaining their objectives.

Bibliography
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AB 1890)? Why? Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. and how could they have improved their approach? Was it always clear what outcomes each stakeholder group wanted from the process? ERG Master’s Project Mark Stout 66 . and why? Which stakeholder groups do you think could have been more effective in influencing the policy formulation process..Appendix A: Semi-Structured Interview Questions Stakeholder Interviews • • • • • • • What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. or over time? What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? Officeholder Staff Interviews • • • • • Which stakeholder groups do you think were most effective in influencing the policy formulation process of ____________ and what were they able to obtain from the process? What methods or strategies did these effective groups use to influence the process? Was any particular method or sets of methods most influential? Which stakeholder groups do you think were best able to set the terms of the debate.e. 1995 Decision? How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? Is your organization more comfortable with one policy decision over the other (i. CPUC vs.

eventually giving in to it while creating tensions with some parties. PG&E’s experience with the restructuring of the gas industry provided valuable insight that shaped this approach. ERG Master’s Project Mark Stout 67 .Appendix B: Stakeholder Interviews Investor-Owned Electric Utilities Pacific Gas & Electric Kathy Treleven is the Assistant to the Vice President for Policy Coordination & Regulation at PG&E. PG&E initially said no to gas deregulation. PG&E does not want to have to automatically take the blame when reliability issues arise. Secondly.”81 What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? According to Kathy. and 2) coverage for utility stranded costs and obligations. PG&E wants to avoid the stranding of deals that were made in an era of an intact regulatory compact. PG&E provides gas and electric service to more than 13 million people in northern and central California. For one. PG&E had two main goals from the California deregulation process: 1) an orderly transition to a restructured generation environment. 81 CPUC Renewables Working Group. they want to be able to shape the outcome more effectively according to Kathy. Now that PG&E has realized electric utility deregulation is inevitable. E-1. “Pacific Gas & Electric is a California Investor Owned Utility Company.

Kathy indicated that the Decision included a plan for an orderly transition to a deregulated generation environment that PG&E desired. “Steve Peace forced everybody to confess what was important to them.” according to Kathy. increasing the risk to full stranded cost recovery. ERG Master’s Project Mark Stout 68 . restructuring as envisioned in the CPUC Decision would have been less likely to take place in an orderly manner due to legal wrangling and ongoing filings at the CPUC.How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. Several areas of compromise for PG&E included irrigation district exemptions for collection of the Competition Transition Charge. and own up to what they would let go. CPUC vs. but had to compromise a little more than in the CPUC decision. what they perceive as significant funding for renewable energy support. the CPUC Decision allowed for more generous stranded cost recovery with a 5 year collection period. Is your organization more comfortable with one policy decision over the other (i. Also.. Kathy said that it was important for the Legislature to use a process which brought disparate parties together. AB 1890)? Why? Although the CPUC Decision was financially easier on PG&E. compared to the four year collection period in AB 1890. 1995 Decision? PG&E got what it wanted on some of the more important issues in the CPUC’s Decision. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? In the formulation of AB 1890.e. PG&E largely got what it wanted. and a shortened period for CTC collection.

PG&E had a core set of negotiators for AB 1890. however. The collaboration that went into the MOU was an example of this approach. Kathy said that there was a. PG&E approached other parties to float proposal ideas by them. discussions in open forums. the negotiating team was given complete freedom to make policy. PG&E relied upon lobbying at the Commission. that sometimes leaked. The legislative process can be even messier. there was consensus within the organization on the basic decisions: direct access was to be supported. However. the Working Group process. in Kathy’s view. This more inclusive process is a. “way to advance goals with a ERG Master’s Project Mark Stout 69 . Although they checked back in with company officers. “healthy internal debate. PG&E was able to maintain a consistent position on issues throughout the CPUC and Legislative process. However. this flexibility combined with the pressures of negotiation sometimes resulted in. “compromises that generated internal dissent. she indicated that there was an occasional rough edge. or over time? At a macro level.” What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? To influence the CPUC Decision. which was required because of the Conference Committee environment created by Chair Peace. and outside conversations. More so than in the past. while the concept of a wholesale-only pool [President Fessler’s original PoolCo proposal] was to be resisted. She thought this was due to the nature of the regulatory process: workshops. at finer levels of technical detail. The most important strategy behind all of these tools was the use of a collaborative process to refine the organization’s thinking. According to Kathy.Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. For the formulation of the CPUC Decision. and responses to Commission requests for input.” outside of the organization. formal filings.

Sirard. while holding on to what they really wanted. E.” Organizations had to be able to make decisions right on the spot to shape the outcome. a gas utility which serves a territory largely overlapping with Southern California Edison’s. 1996.7 million customers in San Diego County.”82 Enova Corporation has announced a merger with Pacific Enterprises. San Diego Gas and Electric Jim Cassie is the Director of State Governmental Affairs for SDG&E. “People who influenced the outcome were present.15 million electric customers in San Diego and southern Orange Counties. the parent company of Southern California Gas Company83. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? In contrast. and willing to be straightforward on what they can give on. “a subsidiary of Enova Corporation. SDG&E. 1996. Kathy said that what mattered most in influencing the formulation of AB 1890 was responsiveness to Steve Peace’s requirements. Jack. 82 83 CPUC Renewables Working Group. and gas service to 0. is a California Investor Owned Utility Company founded in 1881. SDG&E provides service to 1.” according to Kathy. It allows an organization to get buy-in from other parties in advance.reasonableness check. App. ERG Master’s Project Mark Stout 70 . “Uncertain road ahead for utilities” and Enova Corporation 1996 annual report.

We were very opposed to the BRPU. 84 CPUC Renewables Working Group. SDG&E wanted to become the lowest priced California IOU. if you are a broker. It does not make sense for SDG&E alone to go out and acquire more expensive renewable resources. The lucky Arizona utilities went with coal. 1996. Also. with the exception of the legislation’s mechanism for a rate reduction. 1995 Decision? The PUC was on the right track. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. AB 1890 mirrors the Decision in many ways. Throughout the ‘70s. so we would have to buy energy or credits. ERG Master’s Project Mark Stout 71 . except for electricity purchases from Mexican geothermal generators. When Tom Page came in as CEO in 1981.84] SDG&E does not have any renewables. We went to FERC.What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? Our main goals were stranded assets recovery and the creation of a new marketplace where we could compete. and got it struck down. it would be difficult to get 5% renewables. High priced renewables are OK if you are not moving to a competitive future. [The CPUC’s proposal in the December Decision would have required roughly 10% of all retail sales to be backed up by tradable credits for renewables. SDG&E was a supporter of the PoolCo market structure along with Edison. but are not viable with competition. we had the highest rates in the nation. everyone should pay. We were strongly opposed to the RPS. This would put us at a competitive disadvantage compared to PG&E and Edison. they did not get there by investing in high cost renewables.

ERG Master’s Project Mark Stout 72 . These differences were worked out internally with our affiliate. which has formed a joint venture with Pacific Enterprises. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? In addition to the filing formal comments. or over time? In getting ready for competition. the process would have been smoother. Had there been more coordination between the PUC and the Legislature. The PUC had fallen into low esteem with the Legislature. tried to talk with everybody as much as possible.How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? AB 1890 provides a framework set to achieve our goals. but we stepped all over each other internally. SDG&E took part in a series of hearings. Energy Pacific85]. we have started a non-regulated business At times. Whether this happens is up to SDG&E’s operation.e. We have one 85 Enova Corporation 1996 annual report. there would have been litigation or more legislation. and AB 1890 extended it. We tried to participate in the process. CPUC vs. Enova [Enova Energy. Is your organization more comfortable with one policy decision over the other (i. The PUC was not the right forum for this. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. AB 1890)? Why? We supported the December Decision. the goals of an unregulated affiliate may be different than a utilities. If the Legislature had not done what it did to reconcile competing interests.. the Commissioners have no authority over municipal utilities.

The Republicans did not want any renewables funding. Jim Brulte and Bill Leonard wanted to bail on them. supported by regulatory attorneys and experts brought in when needed. but Byron Sher needed appeasement. and need to hit the 1/1/98 deadline. A delegation has taken AB 1890 to DC. ERG Master’s Project Mark Stout 73 . in that their money goes away in 2002. because of the different characteristics of different states. The Conference Committee provided a forum for stakeholders to solve their problems in a collaborative approach. try to resolve it. and nobody would like the outcome. Steve Peace would pick an issue. SDG&E had eight people involved in the process. Peace would. If it could not be resolved yet.or two full time staff in San Francisco. nobody knew where it was going. because of the BRPU experience. Over time. Peace created a mood that we could get the package done. He was adamant against the RPS. We have a $1/4 billion to invest in the ISO. As AB 1890 started. The renewables community has a problem. If they did not solve them. Have sold it that AB 1890 is not a model for the nation. Peace became an advocate for resource diversity. he would move on. he created momentum with no recess. with three officers who had good control over what we were doing. all of the delegates have signed on. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? We stuck to our two goals as the most important priorities. We are asking Congress to leave California alone. at which time they must get competitive. I will not be surprised if they push for new legislation in 2001. This was an exercise that none of us want to do soon.

were equity. based on number of customers. don’t rock the boat utility. let’s do this the right way. and SCE investors as well as independent energy producers should have the opportunity for a return on investment.Southern California Edison Tommy Ross is the Director of Public Affairs at the Sacramento office for SCE. and other energy service providers. a manifestation of these mutual interests. This is best implemented under a transition. I would not say we got everything we wanted. with a phase-in to direct access. equity. we adopted a principled approach that recognized the interests of Edison. The 109-year old investor owned utility serves more than 4. large and small customers. The utility’s 50. With the encouragement of the Governor’s office. Our three principles. If any customers are to benefit. We could have been perceived as opposing direct access. not “the big guys eat first”. so we decided if this was going to come into play. we were positioned as an anti-restructuring. restructuring came to be viewed as inevitable. We also pursued the opportunity for a return on investment. Over time.”86 What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? In early 1995. First.2 million customers in Central and Southern California. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. and return on investment. “the nation’s second largest utility. The regulatory compacts that we entered into need to be recognized. be we did get a principled ERG Master’s Project Mark Stout 74 . 1995 Decision? Those three principles were significant components of the December Decision. 000 square mile service territory has a population of more than 11 million. and served as a basis for AB 1890. opportunity. creating a level playing field. all customers should at the same time.

we do not know how it will turn out. 1996. Is your organization more comfortable with one policy decision over the other (i. This made for touchy meetings with the parties. ERG Master’s Project Mark Stout 75 . Since regulatory changes are subject to regulatory whims. or over time? Absolutely. in terms of headroom for shareholder returns. it is best to adopt a principled approach. We could always ask what principle is driving a requested amendment. E. We will not know how Edison faired until after the transition. This allowed us to be consistent. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. Generally. we were very consistent. All AB 1890 represents is an unfolding framework. Since there are still issues for Edison around stranded cost recovery.. App. putting language in the statute made it more likely to get a known outcome. We made sure they knew 86 CPUC Renewables Working Group. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? The same is true for this legislation. AB 1890)? Why? We were satisfied with AB 1890.e. and CTC exemptions. it validated the direction taken by the December Decision.approach which recognizes the different parties interests. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? Edison worked to ensure that the Commissioners and Legislators understood that the interests being served by our proposals were more than just our own. CPUC vs. otherwise you may open up doors to places you do not want to go.

with customers removing themselves from our distribution service. for instance with the MOU partners. San Francisco. on-site staff. supported by policy. which ERG Master’s Project Mark Stout 76 . There were two areas of concern: physical bypass. We put in legislation to prevent customers from avoiding CTC payment. This is why we were so successful in helping resolve issues. The Sacramento. stranded costs are a bigger issue for municipal utilities than for the IOUs. For both the Commission and Sacramento. regulatory. We also involved people at the highest levels. and DC offices also have weekly meetings to coordinate strategy. Municipal Electric Utilities California Municipal Utilities Association . What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? In the political arena.that everybody was giving up something. excluding electric co-operatives. What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? This was a mix of internal and external politics.Interview #1 Stuart Wilson is the Assistant Executive Director for CMUA. and legal expertise from the corporate offices. Edison strived to keep it simple. On average. not getting all they wanted. working with broad-based coalitions. even now we have weekly meetings with corporate officers to discuss implementation. we have a small. CMUA members had a debate at the beginning of 1996 as to whether to pursue our own legislation. and a Proposition 13 clause stating that local governments can not charge more than the cost of service for utility customers. a lobbying organization representing all but three of the municipal utilities in California.

The Legislature did not need to mandate this. Status Report on Restructuring. 2000. public benefits programs. 3. we avoided “level playing field” language on tax exempt financing. Federal power. in order to get the legislative authority for CTC recovery. We had to stay at the table in order to ensure that our concerns were addressed. an argument which CMUA refutes. App. What 87 CPUC. We came up with a proposal to prepare for the December Decision.87] CMUA also sought the option of long CTC recovery periods for its members. and an outline of flexible. AB 1890 has good stranded cost recovery language which includes physical bypass. 1995 Decision? CMUA had no clear objective at the CPUC. Also.. We wanted to avoid mandates or language on an “un-level playing field”. 1995. CMUA decided that if we do not take a more proactive approach. This forced the munis to support full stranded cost recovery in the IOU CTC.. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? There was no time limit for municipal utility CTC recovery. our customers would have insisted on direct access because of competitiveness concerns. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. other than not wanting deregulation to happen. [IOUs have made arguments about unfair competition from municipal utilities. Our proposal included voluntary participation in the PoolCo. as well as a longer transition period for direct access. ERG Master’s Project Mark Stout 77 . The direct access reciprocity requirements were expected. a quid pro quo for CTC protection..could be used to disallow CTC collection. we will end up playing defense. referring to access to tax-exempt bonds and inexpensive. AB 1890 also includes a requirement for our munis to begin direct access by January 1.

giving munis leverage. quickening their move to a competitive posture. except for its accelerating the transition period on IOUs. We also appeared at full panel hearings. Is your organization more comfortable with one policy decision over the other (i. Without us. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? CMUA filed formal comments.e. with allocation decisions retained by the local municipal utility leadership. or over time? In general. but we were forced to concede on the ISO issue. We had to agree with the IOUs on the FERC filing for the ISO. The legislation also allowed the ISO to be an independent entity before the FERC filing. CPUC vs. ERG Master’s Project Mark Stout 78 .. This was a compromise reached with Ralph Cavanagh. This would not have passed the market power test at FERC. We agreed to collection of public purpose program funds as a percentage of revenue at a level at least as high as the lowest IOU. the ISO would control transmission assets for only 2/3 of the system. AB 1890)? Why? The PUC did not do anything directly to munis in the December Decision. We are not worse off from the legislation. which would have caused transmission constraints. short of wishing deregulation would all go away. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. including our proposal. We did not have huge problems with their Decision.was not anticipated was the requirement for munis to be part of the ISO. Municipal utility representatives attended working group meetings.

California Municipal Utilities Association . we did not oppose the Decision. but did spend significant time with Committee members. and their final Decision had the suggestion of both a wholesale pool and bilateral trades [direct access]. The only alternative was to walk away from the deal completely. We had sponsored legislation to assure no customers could avoid paying the CTC. Stuart Wilson [see previous interview] recommended that I speak with him also to gain additional insights. CMUA filed comments. CMUA lobbied people. but were perfectly willing to see no ERG Master’s Project Mark Stout 79 . Because of this. Peace blew up when he realized he was dealing with an equation that would not balance. CMUA presented a slide graph showing rate forecasts. spending more time negotiating with other parties. forcing the legislation. Edison made threats that AB 1890 would be just as prescriptive for munis as it was for IOUs. Munis have overlap constituencies in ratepayers and citizen shareholders. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? “Blundering”.Interview #2 Jerry Jordan is the Executive Director of CMUA.What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? The Conference Committee had a meeting in Anaheim to focus on muni issues. muni levels rising. CMUA went in very concerned about collecting stranded costs. The pending rate decrease for IOUs provided a cushion for restructuring. IOU levels dropping. It was better to stay with it than not have any leverage. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? The PUC had no reason to listen to us as they do not regulate us.

Reinventing Electric Utilities. It was difficult to imagine how the Legislature would perceive a muni’s need. 1997. 1993. ERG Master’s Project Mark Stout 80 . volunteering to do public purpose programs in exchange for other concessions. 88 Asmus & Smeloff. CMUA did not have the army of people Edison did. beat up. SMUD is a Publicly Owned Utility for the Sacramento region. We were called in by the Committee. Stuart Wilson and me. Sacramento Municipal Utility District Allan Lind has been SMUD’s contract lobbyist since September.legislation passed. We were prepared to oppose the bill if it did not include local control for municipal utilities. but were concerned that legislation would handicap our ability to recover them. in other words we wanted to be able to recover our stranded costs. We maintained flexibility. In the Conference Committee meetings there were also 10 to 15 of our members present at any one time. Our mantra was lockstep with the California Municipal Utilities Association [CMUA. see interviews]. and sent out to negotiate. We never questioned that there would be stranded assets. created in 1946. SMUD also wanted to ensure that the ability to preserve our financial integrity was not adversely affected.88 What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? We had one guiding principle: Preserve the autonomy of SMUD and other munis to determine their role in a restructured environment. CMUA had two lobbyists. and regulated by an elected district board which sets policy and rates for this electric utility. SMUD has a notable history of investing heavily in renewable energy and energy efficiency technologies.

SMUD is very committed to renewables. Even though municipal utilities have the authority to recover costs. there was a questioning of what role. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. This is a classic question of public versus private decision making. We are a consumer elected entity. SMUD responded. It created an environment of uncertainty. SMUD will finish recovering our CTC by 2002. SMUD’s territory is a small island surrounded by PG&E. it seemed obvious that these principles were a gimme. it is planned that PG&E will drop their rates below SMUDs by 2002. But in reality. what equity or fairness issues were raised by them being in the marketplace. that some other source should pay. It is difficult to maintain public purpose programs if everyone else abandons them. should a public agency have in a restructured environment.clean energy. In the June. 1995 Decision? There is nothing of direct benefit to SMUD in the Decision. The Legislature did not elevate this to a well-reasoned. energy efficiency -. SMUD would have been well served if the PUC jacked up IOU commitments for ERG Master’s Project Mark Stout 81 . this impacts munis. There was also a concern that munis would be constrained to the same clock as the IOUs in terms of the duration of the CTC recovery period. this made the question go away. Some would argue that the SMUD customer did not decide to open Rancho Seco. we have to resolve this by 2002. philosophical debate. ‘96 Rate Restructuring Settlement. if any. with board candidates who run on platforms of clean energy and social responsibility that our consumers want sustained. The munis are in a foreign land with the PUC. By constructing a brave new world for IOUs.Going into the process. Assemblyman Steve Kuykendall was direct in his comments. there was a question of whether we would get 100% stranded cost recovery. he does not see a role for munis in a deregulated world. This was the bottom line. Since our rates were 25% below PG&E’s.

This is arguably a meaningless statement. but got more than we asked for. we can point to the legislation. As I mentioned. not to say that we can’t operate as business as usual. This is a profound shift in how munis and IOUs relate to FERC. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? It’s not like we were asking for a whole lot. and conditions on CTC recovery. AB 1890 has language written that denies a muni’s ability to impose a CTC unless they allow direct access. But this language could burden us with litigation. For us. The state’s regulation of Investor Owned Utilities differs from a muni’s ability to decide how to serve. This is not a problem for SMUD. This is an infringement on municipal autonomy. someone can accuse us of having rates too high. If the Legislature had respect for the municipal affairs doctrine. because the repayment of current debt could be viewed as a CTC. If we do not go to direct access. ERG Master’s Project Mark Stout 82 . How this is playing out. SMUD did get something more than we asked for also. this is not onerous or burdensome. it would not have put this in.public purpose programs. Going in. but it might be for others. this gives us political standing. I do not know. A lot of AB 1890 is not crisp. We did not get everything we wanted. It would have been difficult for the IOUs to keep up with us on these programs and bring down rates. a cloud that we do not need. but arguably gives standing to third parties to contest SMUD’s approach to restructuring. enhancing our stature at the federal level. AB 1890 states that filings to FERC would be jointly between the municipal utilities and the IOUs. nobody saw the munis as co-equals to the IOUs. If the IOUs do not respect the munis. AB 1890 also set time limits on the duration of CTC recovery.

It works to SMUD’s advantage to keep their rates high. Is your organization more comfortable with one policy decision over the other (i. it would have been appropriate for the Legislature to allow some lower percentage. saying “What is good for the goose is good for the gander. CPUC vs. AB 1890)? Why? We prefer AB 1890 because of the language which was added to our benefit: The joint filing with FERC.e. I would find that the IPPs see this as a huge giveaway. Since munis could recover 100%.” I think we got used. The strategy of reducing rates to industrial customers. it was used as a basis in the argument for 100% cost recovery by the IOUs. As for 100% stranded cost recovery for the IOUs. or over time? I think so. ERG Master’s Project Mark Stout 83 . but residential customers will not leave their jobs. principles for reciprocity on direct access. This was no small feat for the IOUs. while keeping residential rates high works just fine. but would not want to change the outcome. This could not have been done by the CPUC. It skews the time until true competition. The rate reduction bond is no skin off our nose either. it codified that customers must sign up to a CTC. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. since it places a premium on their bill extending into the future. businesses will make location decisions based on electricity costs..The bill does a couple of profound things.

What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? We participated in workshops and in written testimony. Munis can be divided into two groups: those that are creature of city governments. LADWP is a creature of LA. we have to play things straight up. including through the CMUA. The thing that sets people off is that LADWP transfers $100 million a year to their general fund from their utility revenues. We met with legislative staff and members. more at stake. There are also hybrids that fall in between such as ERG Master’s Project Mark Stout 84 . I was the point person in lining up meetings that several of us would attend. SMUD is an independent special district that can not do that. which does not include campaign contributions. If the city council needs this transfer to balance the budget. putting in 1/3 to 2/3 of my time. but came in for visiting with the staff and members two or three times each. Assistant General Manager. causing concern with other munis. and those that are independent. In addition to myself. and Director of Public Affairs. there were three other people with direct contacts: SMUD’s General Manager. California’s largest municipal utility89] is a favorite whipping boy of some of the members from Southern California. The IOUs have more resources to devote to this. but do send attorneys to represent us. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? SMUD did the lobbying and advocacy that public agencies are allowed to do. As a public agency. We also networked our position with other utilities. We do not have a lobbyist at the CPUC. They were not camping out at the Capital. Comments on municipal utilities and taxation: LADWP [Los Angeles Department of Water and Power. so be it.

Interview #1 David Marcus is a technical consultant to CUE. but this is a case when union interests and public interests coincide. Highlights of Restructuring.. Propositions 64 and 218 create a cloud over a muni’s ability to collect taxes. The strategy then was to protect people.the Santa Clara Municipal Utility District. not jobs. What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? The California unions decided early on that digging in our feet against deregulation was a bad strategy. With deregulation. which is a standalone district. driving up prices. They would not take munis in. By passing a tax. no one is responsible for reliability. Generators want to keep reliability on the edge. like protecting the jobs of meter readers. David was referred to me by Carl Blumstein as playing a central role in this labor coalition’s strategy [see interview with Carl]. building inventory is stupid. you need to create a structure to ensure reliability. as it was expected to pass. SMUD collects a utility tax for the city of Sacramento.. There was a bill in the Assembly to immunize the IOUs against Prop 218. 89 CMUA. the city has imposed a duty on SMUD to collect this tax. In a competitive system. with city council members as their board of directors. ERG Master’s Project Mark Stout 85 . a coalition of labor unions whose members work at all of the electric utilities in California. saying this would jeopardize the bill. The ultimate idea of our strategy is to protect jobs. In cases where fights would be inevitably lost. Utility Labor Unions Coalition of California Utility Employees . we decided to go for retraining. Existing regulated rate systems have incentives for reliability through excess capacity. owner interests do not.

and responsiveness to customer inquiries. a technical consultant to CUE [see preceding interview]. ERG Master’s Project Mark Stout 86 .How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? Getting CTC recovery for worker retraining and severance packages was a major victory. Most customers want more than incremental savings. but criteria of reliability and quality of service. transmission. the existing unions get a contact for two years of plant operation. Enron now agrees with us. a result where the only criteria was not cents/kWh. Also. and how the market should be shaped. when a utility plant is divested to a new company. We initially focused on whether. Marc was referred to me by David Marcus. there are no savings to customers to be gained from retail competition.Interview #2 Marc Joseph is an attorney actively representing CUE through both the CPUC and legislative tracks. We are willing to compete. The legislation also attempts to ensure the reliability of the system by building in responsibility for inspection and maintenance into the new regulatory structure. but with a rational transition. We pointed out that the only part of the industry subject to competition was the variable cost of energy. and to what extent. and distribution reliability. What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? We hoped to shape restructuring policy to minimize the adverse impacts on utility employees while still achieving the goals of the Commission: Lowering rates while protecting employees. We already had viable wholesale competition. we shifted to focus on generation. As it became clear that this argument would be lost. Coalition of California Utility Employees . increasing efficiencies without sacrificing reliability and service.

and have committed to the January 1. we supported AB 1890.. ERG Master’s Project Mark Stout 87 . AB 1890 provided for recovery of reasonable employee transition costs. 1995 Decision? Not very much. and it did not provide for generation supply reliability. CPUC vs. with a 2 year continuation of the existing staff. AB 1890)? Why? Yes. It recognizes the need for divested plants to be operated by capable people. It calls for the adoption of standards for the inspection and maintenance of distribution and transmission.e.How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? Most of what we sought. The Decision fell considerably short of where it needed to be. The Decision also did not recognize the importance of maintaining local generation throughout California. For example. dedicated workforce. ‘98 start date because of that. Some things were being addressed in other proceedings. The CPUC is required to ensure that generation reliability is maintained before plants leave their jurisdiction. AB 1890 also gives the ISO the responsibility to achieve Western Systems Coordinating Council (WSCC) standards for planning reserve criteria. It attempted to address the means for employees to be provided with assistance to handle their transition. Is your organization more comfortable with one policy decision over the other (i. distribution reliability was in a separate rulemaking. But no standards were discussed for inspection and maintenance. and quantitative reliability measures were beginning in another rulemaking. or the value of a highly skilled.

CMA. that featured a rate freeze in exchange for a finite CTC collection period. that was one of the basis for AB 1890. CUE also took part in a coalition. and AB 2610 dealing with generation reliability. AB 3153 providing employee transition cost.Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. spending all of August working hard. with three or four representatives in Sacramento much of the time. This collaborative effort resulted in the June ‘96 PG&E rate restructuring settlement. “has represented all facets of the U. that held together. ERG Master’s Project Mark Stout 88 . We participated fully in the public process at every opportunity. but did some personal lobbying before the December Decision. We participated fully in the Committee hearings and drafting of language. CLECA. we sponsored two bills.S. We did not do much. All comments we filed had yellow covers to stand out in stacks. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? CUE took part in the process with many written comments as well as in a full panel hearing. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? CUE marched in the Steve Peace death march. wind energy industry since 1974. including PG&E. Earlier in the summer. Independent Producers American Wind Energy Association Nancy Rader is the West Coast Representative for the American Wind Energy Association. AWEA. We have had no trouble with consistency. or over time? CUE has always spoken with one voice. and the oil companies.

How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. She mentioned that another stumbling block for the 90 CPUC Renewables Working Group.” from the California electric utility deregulation process. E-1.”90 What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? Nancy says AWEA sought to attain a “strong renewable energy policy. 12 accessory parts manufacturers. However. Nancy had developed the RPS concept for AWEA since being hired on. ERG Master’s Project Mark Stout 89 . academicians and interested individuals. efficient policy mechanism. and is a long-term. such as the Renewables Portfolio Standard.” EDF led a coalition with the only non-MRPR proposal in the CPUC Renewables Working Group. “corrects market failures and market barriers. the MRPR was. which Nancy and I found to be clearly outside of the purview of the Working Group’s charter. including 155 members in California. with implementation details to be worked out through a CPUC stakeholder Renewables Working Group process. 10 project developers/operators. “undermined by EDF [the Environmental Defense Fund] who actively sought to increase opposition to the policy in order to build support for their competing policy.” for supporting renewable electricity generation. includes 7 turbine manufacturers. 22 consultants.AWEA’s 750 members. Although she says the Decision language was vague. the essential elements of the RPS were included in the MRPR so that AWEA could largely get what they wanted. The RPS. 1995 Decision? Nancy was successful in getting the RPS embodied in the CPUC’s Decision as a minimum renewables purchase requirement (MRPR).

It amounted to nothing more than a deal. Nancy remembers that the meeting with President Fessler resulted in a “vague discussion”. and that she was not certain of his support at the time. or over time? According to Nancy.RPS was a lack of support from the Sierra Club. The RPS. arranged for personal meetings with CPUC President Fessler and the staff of Commissioners Knight and Conlon. and that consequently UCS’s support of the RPS was critical. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. “productive discussions”. when Nancy was hired to develop a strategy for how renewables policy would be structured in a competitive industry. market-driven policy. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? To achieve AWEA’s objectives at the CPUC. In comparison. in comparison. is a long-term. Nancy relied mainly on written testimony filed with the Commission. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? Despite AWEA’s success in the CPUC Decision. whose outcome was dependent on allocation by a state agency. AWEA’s position in the CPUC and Legislature has been consistent since October of 1994. they were not able to get any of what the organization originally wanted in the bill’s language. comprised of detailed arguments. along with Jane Kelly of UCS. leading to no long term policy. Nancy said that the allocation of Systems Benefits Charge money for renewables in AB 1890 was a temporary pile of dollars. and ERG Master’s Project Mark Stout 90 . Nancy. the meetings with Commissioner Knight’s staff were.

At one point towards the end of the Conference Committee process. Steve Peace. resulting in very little control for AWEA. “Knight was sold on the RPS concept because he is a believer in markets. and it worked. and people were not listening to arguments.” The Committee Chairman. had killed the RPS before any discussion began. Peace threw all of the stakeholders out of the room and told them to come back in one hour with their deals already ERG Master’s Project Mark Stout 91 . Nancy continued to describe the process: “Time was too short. Nancy remembers that the conference committee meetings were occurring in an.” What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? In contrast. she was able to get rid of the Renewables Marketing Agent concept without insulting its creator. but Peace killed it again. The new CPUC President Conlon tried to put the RPS back on the table for discussion. the Legislative process in the summer of 1996 was a “nightmare” according to Nancy. “trusted in the process. with many issues being ironed out at once.Nancy feels that. AWEA relied mainly on Senate and Conference Committee hearings as well as input on draft legislative language to influence the policy outcome.” She was also invited to participate in a full panel hearing on public purpose programs. “incredible time crunch. Chairman Peace.” One issue that hampered Nancy was that the Independent Energy Producers (IEP) representative “had control of the pen for draft language. Nancy said she. AWEA lobbyist Joe Caves was able to get John White’s customer rebate proposal pulled from the draft language. In retrospect. There were major egos on the Conference Committee with pre-formed opinions.” Nancy did feel that AWEA got things derailed out of the conference committee that would have been worse than what eventually emerged. By melting down the proposed language.

she offered to walk away from the table and pull AWEA’s endorsement if Ralph Cavanagh of the Natural Resources Defense Council. AWEA endorsed the bill reported out of the conference committee. She was also disappointed that no discussion happened amongst legislators outside of the bipartisan conference committee. In the end.”91 According to Jan. as well as independent power marketers. along with gutting energy efficiency funding. IEP was formed in 1982. and Pacific Gas and Electric (PG&E). would do the same. When Nancy saw the public goods money being stripped away from energy efficiency. AWEA would have dropped their endorsement also. App. Independent Energy Producers Jan Smutny-Jones is the Executive Director of IEP. “wanted a win. California Manufacturers Association (CMA). E. The utilities were able to obtain a three month extension on to recovery of the Competition Transition Charge. This resulted in furious horse-trading between Southern California Edison (SCE). NRDC had no media strategy.” Nancy added that if TURN had not endorsed the report. ERG Master’s Project Mark Stout 92 . resulting in little debate on the Assembly or Senate floor. the key advocate for energy efficiency funding. because he. made no attempt to build clout. 91 CPUC Renewables Working Group. She was disheartened that Ralph would not pull NRDC’s endorsement. didn’t want to ruffle any strategies. “California’s oldest and leading trade association representing the interests of developers and operators of independent energy facilities.made. IEP’s primary goals are to safeguard the interests of operating independent energy projects. but relied on their name instead. 1996. largely because no public interest group was willing to oppose the bill. and ensure that California remains a healthy market for the development in the independent energy industry. in order to come up with the $540 million allocated for renewables support over the four year transition period.

Ensuring the sanctity of existing contracts is our highest priority.and represents a diverse group of gas and coal-fired cogeneration and renewable energy plants. Over time. [SCE succeeded in killing the BRPU at the Federal level in 1995. Over time. the Decision allowed for a direct access market developing. 1995 Decision? Overall. the Governor’s office convened a meeting due to the hostilities between large customers and Edison at a time when Pete Wilson was trying to run a Presidential campaign. In May. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. 300 MW set aside for renewable generation. ERG Master’s Project Mark Stout 93 . The BRPU had resulted in 1300 MW of contracts before being struck down. to spending millions of dollars developing California’s integrated resource planning process. A large portion of the MOU is reflected in the December Decision. By allowing utilities an opportunity to recover 100% of their stranded costs.] What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? It was clear that the way we were doing things was not working well. independent producers were better off working with customers. they had moved from using California’s Standard Offer process as a vehicle for the expansion of the independent power sector. we influenced the Memorandum of Understanding that was released in August of 1995. the CPUC Biennial Resource Plan Update. For IEP. IEP also sought to maintain a policy for resource diversity in the mix of generation. IEP did well from restructuring. and included a policy for maintaining resource diversity. Initially. but not allowed to talk. the MOU allowed the restructuring process to move forward. Direct access is a tool for future development. IEP was invited to the meetings.

leading to an almost unanimous understanding of the need for legislation. on the issue of full stranded cost recovery. We also made a myriad of filings. or over time? Yes.. some members do not agree with this. The municipal utility issue also needed to be dealt with. as well as support for resource diversity. Overall we did well in terms of direct access to customers. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. a “settlement negotiation with a critical mass of interest groups”. It was necessary to provide an underpinning. There continues to be opportunities to take potshots over a lack of consistency. the amount paid to QFs such as many IEP members under PURPA law]. The legislation also includes language on a method for calculating SRAC [short run avoided cost. Dan Fessler was a proponent of the PoolCo. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? Our primary focus was through the MOU. which was not supported by IEP or customer groups who feared that we would wind up with a market structure which would cause unraveling. ERG Master’s Project Mark Stout 94 .e. CPUC vs. For example.How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? Much of the same applies to AB 1890. but do not want their contracts challenged by the IOUs or have the IOUs driven into bankruptcy. we had historically tried to take the high road on public policy issues. Is your organization more comfortable with one policy decision over the other (i. AB 1890)? Why? IEP prefers AB 1890.

there is a move away from command and control. I believe the vast majority of developers will survive the 11th year QF cliff. which is how the RPS was perceived. First. but there will be an industry shakeout. even if construction of their plant started before December 20. General comments: In the December Decision. ERG Master’s Project Mark Stout 95 . The RPS lasted about seven minutes at the Legislature. An issue that had not been dealt with well at the CPUC was renewables. with the creation of an expanding core group of people who decided this was the right way to go. Tactically. Strategically. The Renewables Portfolio Standard was put in at the last minute. CMA and CLECA offered to carry the CTC forward [three months] in order to include renewables funding in the public goods charge. The $540 million surcharge for renewables was Plan B. which would have happened without restructuring. there are the three or four merchant gas plants will be built in California in the next five years [see Edie Lau. It did not have political legs within the Commission. and not enough talking with other market players. Three fascinating things have occurred since the issuance of AB 1890. there was too much fighting with the Sierra Club and EDF. The cogeneration-CTC waivers in AB 1890 were for the companies that were stuck in the predicament of having begun construction of new generation. anybody going to self-generation would have to pay the CTC.What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? A lot built on the MOU. Developers will be much better off selling to people who want to buy renewable energy rather than forcing it down utilities throats. The renewables community was like a family with a rich uncle dying and no will. using oblique language. 1995. who would still be required to pay the CTC or an exit fee.

who have a choice in all of their other commodity inputs. which has significant power to buy. 1995 Decision? AECA got direct access with a slow phase-in. To the PUC. Finally. ERG Master’s Project Mark Stout 96 . Giving choices to folks will lower rates. sell. a lobbing group representing all farm groups in California except for those represented by the Farm Bureau. playing a significant role in planning and cost overruns. Although more than 70 irrigation districts never have sought to utilize this power. This got traded away. three have. the nukes were not.“Law generates push for gas-fired power plants”]. but lost everything else. the fact that Enron [large. This is based on input from growers. Now others are precluded by the non-bypassability of the CTC which will not allow for competition. non-bypassable meant something. We also desired that the IOUs share in some of the burden of their stranded costs. Agriculture had been fuel switching for a number of years. What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? AECA was a strong advocate for direct access. While we recognized that contracts with QFs were forced. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. An irrigation district is a type of water district. The IOUs were able to protect the whole concept of CTCs. Large Electricity Consumers Agricultural Energy Consumers Association Michael Boccadoro is the Executive Director of AECA. independent power developer] bought Zond [wind turbine developer] speaks of significant market potential. and distribute electricity. Then there is the announcement by SCE that they will be divesting 100% of their generation.

with a grassroots effort generating letters to and from the Legislature. as did almost everybody except for Edison. Diesel and natural gas use was exempted. Is your organization more comfortable with one policy decision over the other (i. We were leading. We were able to carve out roughly three hundred megawatts of CTC exemptions for irrigation districts. unlike at the PUC. We lobbied at the Governor’s office. Our ERG Master’s Project Mark Stout 97 . We made direct testimony at the PUC. What kept the utilities at the table was that if a party disagrees with the PUC. The CTC could have been challenged as an exit tax. approach was very political.. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. or over time? AECA recognized that in the legislative debate. vocal opponents to the PoolCo. so we left it alone.e. CPUC vs. AB 1890)? Why? AECA preferred AB 1890. the CTC issue would not be resolved with less than 100% stranded cost recovery. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? AECA approached things differently than the other intervenors. This can go to the state supreme court if it is not dealt with early enough. it can file for a rehearing. Agriculture got the overwhelming majority of the CTC exemptions. although ideally there would be no limits.How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? AECA won on direct access. based on something in a Decision not supported by the record. but we did not get less than 100% CTC recovery.

but managed to get its language in thanks to Curt Pringle. sending press releases to Wall Street analysts. We had an irrigation district bill which the utilities had previously killed. we could have pulled a lot of agricultural votes on the floor otherwise. Seymour & Rowher is Counsel for CIU. We were one of the last groups hanging on the outside. A couple of the Conference Committee members did not have a clue what was in the bill. We also had a strategy based on financial market leverage. A friendly analyst provided us with a fax list for Wall Street. It is amazing how much time the CEOs of IOUs spend on Wall Street. but stayed out of the MOU. which has evolved into an electricity-oriented group. Brand. IOUs care more than anything about their stock price. California Industrial Users Phil Stohr of Downey. Steve Peace kept saying it would go with a unanimous Committee vote or it was not going to go at all.What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? The legislative debate was different. The political leverage of agricultural votes was critical. We then made sure that anything negative about the utilities made it out to the analysts. AECA participated with a customer coalition. traditionally most active with CPUC proceedings. This was too complex a bill for a split conference committee. ERG Master’s Project Mark Stout 98 . an organization that was formed in the late 1970s to represent industrial natural gas and electricity users. The irrigation district CTC exemptions was one of the last amendments added.

there was no forum in which to advocate for it.S.” ERG Master’s Project Mark Stout 99 . The draft Decisions [May. The December Decision had aspects which gave us pause.. 1995. but in general was a step forward. 1995 Decision? Quite a lot in terms of basic concepts.What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? We sought retail wheeling.. The overwhelming majority of our activity has been on traditional rate cases. the development of an option that would permit industrial customers to look somewhere else than the UDC for electricity generation. Between May of 1995 and the Decision. the parties were involved in many conversations. Much of that related to the MOU. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? The element at the core of AB 1890 came about as the result of informal negotiations between the December Decision and AB 1890. electricity92] mentioned retail wheeling to the CPUC. The work between May and September was critical. representing 24 companies that consume over 4% of U. In 1986 when ELCON [the Electricity Consumers Resource Council. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. This was not perceived as realistic before the Yellow Book. 1995 CPUC proposals] were a major disappointment because of the dominance of PoolCo. Retail wheeling served as a muted backdrop. This was a new element which brought a new dimension: a rate freeze with a well- 92 Asmus. with Direct Access pushed out on the horizon and tied to a range of contingencies. this sent the Commissioners scurrying. “Retail wheeling:. resulting in the PG&E rate restructuring settlement.

The provisions presenting a definite time period within which the CTC would have to be recovered were critical. CPUC vs. Is your organization more comfortable with one policy decision over the other (i. Each brought a new dimension and set of sub-issues to be absorbed into our area of interest. To fully answer. laying out requirements for the parties to get specific Legislation. and that they needed a legislative backstop. We have seen our position evolve at each major waystation.. There was a perception that Edison’s zeal reflected a concern that their hard-fought victory for 100% CTC recovery might be ephemeral. need to get into the specifics of the bill. In terms of process. Provisions of the MOU had a lot to do with the process moving to the Legislature.e.defined period of time in which CTC obligations would be disposed of. this time frame foreshortened the transition to the new competitive market and meaningful customer choice. CIU was not a signatory to the MOU. or over time? CIU had no problem speaking with one voice. Incorporation of the Commission’s policy and some additional elements into the Bill took California another big step down the road towards restructuring. for instance both included language regarding no cost shifting. Along with the rate freeze concept. AB 1890)? Why? The December Decision advanced the cause another step. many parties felt legislation was necessary to assure a measure of permanence in the Commission’s policy Decision. This carried over directly to AB 1890. There were a lot of areas of overlap between the December Decision and AB 1890. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. But the basics of our position have remained unchanged throughout ERG Master’s Project Mark Stout 100 .

some were at the request or demand of the Committee. It is important for the Commissioners to hear from the people actually running the businesses whose electricity needs have been our focus. CIU took part in most full panel hearings. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? Our participation was largely a matter of being present and accounted for. We have occasionally lobbied on more specific issues.What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? We were involved in all formal proceedings. bringing member company representatives in from time to time to discuss broader agendas. but had no idea of the magnitude of tasks in the implementation phase over the last 18 months. ERG Master’s Project Mark Stout 101 . it felt like “we’ve been here before”. The issuance of the Blue Book sent seismic waves through the community. We were there for the great bulk of the hearings. Some of these meetings were spontaneous. we had member company representatives participate in several full panel hearings. Our members are business entities with a nationwide presence. Rather than have counsel speak. we commented on the Yellow Book. The raw material of the initial bill came from coalition participants. but our concerns at the time were still rate-case focused. At some points. and made our contribution. particularly in the collateral coalition meetings. due to the length of the policy phase proceedings. and filed comments at every opportunity. Early on. This applies to the formal Committee. We have also met with the Commissioners. for instance on the rate restructuring settlement. able to draw on experts knowledgeable on energy policy and acquisition. We thought that we were busy during the policy phases of restructuring. as well as the caucusing and preparatory sessions amongst parties.

Some aspects of the Bill developed in off-line. has been very useful in the implementation phase. We have made some legislative appearances. It is remarkable how much AB 1890 was a product of broad-based discussions. This recent process marks the first time the Legislature has taken such a broad role interacting with the CPUC. there has been a warming in the cordiality of the relationship between the Legislature and the Commission.Interview #1 Dianne Hawk was a Utility Regulatory Consultant for Barkovich and Yap. such as in September of ‘95 at the SONGS hearings. and there was a perception of considerable influence emanating from the Governor’s office. We were interested. ERG Master’s Project Mark Stout 102 .) California Large Energy Consumers Association .This time spent. industrial electricity customers. CLECA is an organization representing large. The Governor’s office was also party to several discussions. and have monitored the legislative process but have chosen to focus on the Commission. representing CLECA during the process leading up to the CPUC December Decision.. President Conlon was there in the wee hours of the morning. CIU has never really included in its agenda a strong presence at the Legislature. What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? CLECA wanted lower rates in the long run. Inc. (SB 960 was pulled together over several days following the AB 1890 deliberations. There will likely be follow-up at the Legislature principally with respect to SB 960 which dealt with PUC reform. In the course of this process. cost-based rates. however. aside from being painful. direct visits with the members.

we met directly with Commissioners. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? In addition to filing formal comments. I suggest you speak with Barbara Barkovich. but would trade off short term for long term gains. ERG Master’s Project Mark Stout 103 . but wanted multiple ways to purchase electricity. The defining of industry structure for competition to drive prices down was important. but we came closer. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? With regards to market structure. even over time. [See interview with Barbara] Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. We also wanted the separation of the ISO and PX. or over time? CLECA’s positions were consistent. there was not as much coordination or compromise amongst stakeholders. 1995 CPUC majority proposal. I am unsure of whether it will happen. They were based on a consistent thread of how to organize a market. Prior to this proceeding. nothing changed significantly from the CPUC Decision. CLECA did not want a single market. The MOU set the tone for that. We did not have the expectation that it would happen tomorrow. There was a lot of compromise.How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. On this question. 1995 Decision? The institutions in the Decision were designed with enough flexibility to give the opportunity for lower rates. given the PoolCo structure in the May. Barbara Barkovich also took part on numerous full panel hearings before the Commissioners. It used to be that the IOUs were driving everything.

they are seeking the same for electricity.California Large Energy Consumers Association . It seemed premature before then. as early as our comments on the Yellow Book in the Fall of 1993. avoiding cost shifting. Inc. The May CPUC Proposal was lacking. representing CLECA throughout California’s electric utility restructuring process. This was a big objective for the legislation. extending them to include more of the AB 1890 process. based on the concern that stranded cost recovery would be shifted onto industrial customers. it was very much influenced by the MOU. CLECA wanted to make sure unbundling and stranded cost recovery were done with no cost shifting. We did not want customers to pay any more than they had been. Rates are very high in California. We had experienced with the regulatory proceedings in the past. which is why the MOU happened. Our members are used to multiple suppliers for everything else. There was some language about ERG Master’s Project Mark Stout 104 . How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? CLECA was one of the first parties to advocate retail wheeling. and we see competition as the only way to bring them down. but no detail. 1995 Decision? Competition was there.Interview #2 Barbara Barkovich is an Energy and Utility Regulatory Consultant with Barkovich and Yap. I spoke with Barbara to build on the base of insights into CLECA’s positions that Dianne Hawk provided..

Public purpose money should go to the next generation of technologies. CLECA wanted to make sure small customers pay off their own bonds to finance the 10% rate reduction. with a lower CTC payment. This was absolutely essential for the legislation. The December Decision does not treat the CTC using the residual method. AB 1890 also includes comparable CTC treatment for direct access and non-direct access customers. Our members will not experience the rate increase they would have if this went away. ERG Master’s Project Mark Stout 105 . allowing for a 2001 date for the end of CTC recovery. We also kept interuptable rates in place for 5 years. based on paying for the CTC with the same rates large customers are paying now. We did pretty well. I am not sure how much residential customers wanted cost reductions paid for by bonds. Many of the existing renewables companies have been managed poorly. One things I was disappointed with was the rampant green/renewable payoff. just like more pigs at the trough. and public purpose programs are subtracted from the frozen rate. It calculates CTC costs based on the residual method CLECA proposed. distribution. in general AB 1890 is a good bill.How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? More than in the December ‘95 Decision. A residual CTC is left over when the PX price. The rate restructuring for Diablo Canyon was along the lines of the residual method for CTC setting. transmission. The legislation did a good job buying off people. not bail out developers that did not create a reserve with their subsidies.

Is your organization more comfortable with one policy decision over the other (i.e., CPUC vs. AB 1890)? Why? AB 1890. Some things were not addressed in the December Decision. recovery went on too long, we wanted it time-limited, not stretching till 2005. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings, or over time? Yes, CLECA is a small and cohesive organization. We had to give up on 100% stranded cost recovery, resulting in more of an opportunity for utilities to recover than we would have liked. We were not prepared to agree to the levels of public purpose funding in AB 1890; we also did not want funding floors, we wanted caps. Till the end, we did not like renewables money going to existing plants. A major win was that fuel price increases would not get passed through. If this eats into the CTC headroom, that is the utility’s problem. This does not guarantee full stranded cost recovery by a long shot. A lot of formulation went into the rate restructuring settlement. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? Of course, CLECA filed formal comments. The most important thing we did was Also, CTC

negotiating the MOU. Even though the December Decision was not perfect, it was much better than the May, 1995 proposal as a result of the MOU. The May proposal was based on a PoolCo concept, with wholesale competition. This proposal was supported by Edison, SDG&E, and UCAN, but it angered the industrial customers. CMA hired Flanagan to talk to the Governor’s office and plan a campaign against Edison. Edison sent a letter to CMA’s board telling them that their members were, “off the reservation.” CMA fired a response back. Edison ran ads

supporting PoolCo, and CMA was about to retaliate, which Pete Wilson did not want when he ERG Master’s Project Mark Stout 106

was running for President. CLECA did not want the utilities to have full stranded cost recovery, but this was negotiated before I was even at the table. Edison was not even willing to talk without it. Another big issue was the SONGS [SCE’s San Onofre Nuclear Generating Station] settlement, extending recovery for this stranded asset. Important elements of the MOU were the proposed market structure and phase-in of direct access. The 1/1/98 date to begin was CLECA’s idea. It was critical that the Power Exchange, ISO, and direct access all start at the same date so that you do not end up with a PoolCo. We went to the Legislature and the PUC, including direct meetings with the Commissioners, in order to explain the MOU. Since this was a rulemaking, ex Parte rules were not in effect. We also met with non-MOU parties to see what it would take to get them on board, but they all wanted too much. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? An important step was negotiating a rate restructuring with PG&E, CMA, labor, oil, agriculture, and other groups. The legislative process had an awful lot of horse trading in a public, political environment. Steve Peace wanted it done in front of him. Many more parties were involved in this process.

California Manufacturers Association
Karen Lindh was CMA’s energy and environmental policy director through the CPUC and AB 1890 process, representing the organization in this area since 1976. CMA is an 800 member

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organization, representing mainstream California industries before the CPUC and Legislature.93 CMA has been involved in energy intervention since 1970, making arguments on cost of service rates and rate increases. What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? CMA wanted to achieve utility rates in California for gas and electricity in order to compete with out of state industry. It became clear that customer choice was the only way to do this. Services that are natural monopolies should continue to be regulated on a cost of service basis, on a customer class basis. We desire a free market for everything else. In 1984, CMA was involved in a battle for the customer choice of gas, a ten year effort. We then turned to electricity to pursue the same goals. At the time the electricity restructuring process began, California electricity rates were 40-50% above the national average. Our members’ electricity usage is very different by industry, with electricity comprising a varying percentage of input costs. How much customers paid was also dependent on their load factor. For many members electricity is a primary cost. Coincidentally, the CPUC Division of Strategic Planning was thinking about

restructuring the electric utility industry, resulting in the Yellow Book. At the same time, CMA started a project for restructuring, and became involved in a series of workshops at the PUC. Our longer term goal is a reduction in costs. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20, 1995 Decision? CMA got direct access and non-discriminatory ISO access to the transmission grid. I would say 75%. There were some flaws in the Decision, but there was tremendous progress since

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Asmus, “Who are the De-Regulation Advocates: Profiles...”.

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the May draft. This was seen as a 100% improvement. The Decision had a lot of weakness on direct access phase-in. We were also concerned over the level of the CTC. CMA had worked out a methodology, but a lot of work was needed in the December Decision. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? AB 1890 added additional gains. The rate freeze put utilities at risk for recovering 100% of their stranded costs through the CTC. CMA did not want to pay any more for electricity than we were already paying. AB 1890 was an incremental improvement over the Decision. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings, or over time? Because of CMA’s long background dealing with energy issues, we had worked out many positions in advance. Along the way, some issues that were brought up had the potential for derailing the process. Some Eastern members thought they had been sold down the river by 100% stranded cost recovery, some thought it was politically possible to outmuscle the IOUs. We had to arrive at decisions cooperatively. Membership was voluntary, so people had to work with other members of the group. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? The primary thing was the MOU, which became the baseline for the December Decision. There were a series of meetings with the Governor. He did not want industries at a loggerhead, wanted us to go for a win-win solution. The Governor’s office sat in as a moderator on the negotiations, which went from May to August. SCE was the only utility involved; they did not want to give up their merchant plants and were opposed to direct access. The industrial

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including Lenny Goldberg from TURN. Steve Peace held marathon sessions. with supra-economic assets netted out. We worked by bringing PG&E into the process. The actual stranded costs are asset values that are no longer economic. Even in the legislation. The customers agreed to 100% stranded cost recovery. technical support was provided by Glen Shearon of Inland Paperboard. helping others to resolve their issues. The municipal utilities represented by CMUA were too diverse. The IOUs suggested a revenue stream approach to CTC calculation. ERG Master’s Project Mark Stout 110 . What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? CMA was involved in every AB 1890 negotiation. Groups were influential by being at the table.customers wanted direct access. using a different formula. as well as other customer groups. Inter-member briefing was also important. Each party got what was most important to it. not just contracts for differences. no attempt was made to jam something down someone’s throat. and come to the table with a solution. There was a problem if you did not know what you wanted. chief counsel at the PUC was Keith McCray. and participated in two full panel hearings to explain the MOU to the Commissioners and the public. CMA filed formal comments. Our chief representative was Mark Timmerman. The important thing was to make a positive contribution to the bill. and I was involved as an energy analyst. The market structure agreed on was a power exchange and a separate ISO that would ensure non-discriminatory access to the transmission grid. and were not able to articulate what they wanted.

“the devil is in the details”. I do not think small consumers will benefit from retail competition. our goal was to protect as much of the old programs as possible. we strove to put as much consumer education and protection in place as possible to guard against the market abuses we are seeing in the deregulated telecommunications sector. such as non-english speaking customers. but it was realistic. The December Decision did a fairly good job in recognizing low income ERG Master’s Project Mark Stout 111 . In addition. everything was included. What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? Latino Issues Forum wanted to try to maintain as many public programs for low income and vulnerable populations. 1995 Decision? In an outline form. a non-profit organization advocating for Latino Californians. We also wanted to fund low-income weatherization programs at as high a level as possible. The interview subject preferred to remain anonymous. but as Dan Fessler was fond of saying. and add needed education and protection programs in order to at least maintain the status quo for small consumers. In some ways this was not a very lofty goal. We wanted to keep the CARE (California’s Alternative Rates for Energy) program funded at an uncapped.Small Electricity Consumers Latino Issues Forum Latino Issues Forum. need-based level. Jane Kelly of UCS [see interview] recommended that I talk with someone at this organization. We realized it was not realistic to resist retail competition as TURN had tried in telecommunications. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. Overall.

Significant consumer protection and education is needed to protect the abuses happening in telecommunications today such as slamming. as the whole process has been sequential. AB 1890 did not go far enough. AB 1890 was a deal cut in back rooms between powerful players. Is your organization more comfortable with one policy decision over the other (i. At this stage perhaps it was not meant to. Latino Issues Forum did not actively participate. Ralph Cavanagh carried our torch primarily. AB 1890)? Why? It is not entirely correct to contrast them. In terms of consumer education and protection. or over time? Probably ad nauseum.e. ERG Master’s Project Mark Stout 112 . Small consumers had to at least be unharmed if not better off. It did not go nearly far enough in consumer protection and education. The December Decision was a blueprint in recognizing these needs. This needs to be cleaned up in this year’s legislation..and vulnerable population issues. but did not go far in addressing them with specific solutions. CPUC vs. Public purpose programs for low income consumers must be maintained. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. It did have the benefit of good language on low income rates and energy efficiency programs. since we had a mantra that we recited at every chance: Deregulation had to be equitable. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? Not as much.

We are also a member of the Greenlining Institute [a non-profit organization representing low-income communities of color]. only part time. They were understaffed. At times. This may come under attack in the future. This Division was actually using AT&T language translation. had short hours. have historically focused on the PUC. We also participated with the Commissioners in community briefings to inform the public of upcoming changes. We also wrote letter to Commissioners that have been influential.What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? We filed dozens of briefs in the last few years. Some of this year’s cleanup legislation will exclude municipalities from the anti-slamming ERG Master’s Project Mark Stout 113 . Our letter to the Commissioners sparked modification and an investment of resources as part of the PUC’s internal restructuring plan. we found out that the staffing for PUC complaints was utterly inadequate. a very expensive service. It caused some embarrassment because of the total inadequacy. and spoke to the press on critical issues. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? Latino Issues Forum depended on Ralph Cavanagh to articulate positions there. mono-lingual english only. but because of a lack of resources. a possible profit source for them. The utilities were hoping that they could administer CARE and low income weatherization. After a meeting with the Consumer Services Division of the PUC. We also had small consumers mail in postcards to the Commissioners on rate issues. and had no 800 numbers. which has partnership agreements with PG&E and Edison that they will represent some of Greenlining’s issues. and testified whenever we had the opportunity. we interacted with the Legislature.

proposed by the Yellow Book. Our reaction to the Blue Book was that restructuring must provide competitive options for small customers. But they can only point ERG Master’s Project Mark Stout 114 . there are different set of simultaneous proceedings. With what we see as a failure of will by the regulator. getting rid of the multiple proceedings. I am concerned about fly-by-night companies. making the regulatory process impossible to track. The utilities argument for full recovery is based on the notion of a regulatory compact with a quid pro quo of cost recovery. California needs better regulation. 100% stranded cost recovery for the IOUs does not make any sense because they already had a risk-adjusted rate of return. TURN took a firm position calling for the PUC to start regulating the utilities. a nonprofit organization advocating for residential and small commercial utility ratepayers. many annual. There is also a need to deal with the market power of utilities. The Utility Reform Network Bob Finkelstein is a staff attorney specializing in electric utility issues for TURN.language. TURN has called for a single annual rate-setting. Although we need as many consumer protections as possible. and that small customers should not suffer. which could result in large customers leaving the system and smaller customers left holding the bag of higher cost resources. and not grant them 100% stranded cost recovery. Currently. I think we can safely exclude municipalities. This would allow all customers to benefit. These risk-based cost of capital decisions got more explicit in the ‘90s and were very explicit by ‘93 and ‘94. This annual rate setting would be based on cost of service with an TURN was against the notion of retail wheeling opportunity for profit and a risk of loss. What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? The Yellow Book laid out four options for the California electricity utility industry’s future direction.

although by July. as opposed to the rate cap in the PUC December Decision. with incentives for divestiture of utility generation. including low income. It also included a recognition of the importance of market power. We thought there would not be comprehensive legislation that year. Some commercial customers had wanted aggregation for different locations. amounting to $10’s of millions for divesting an industry segment with revenues in the billions. TURN was able to knock out an earlier Brulte bill. TURN also did not like it because we got a rate freeze. for aggregation of small customers to take advantage of direct access. it was clear that the Legislature would be moving forward. everyone except for small consumers. in concert with oil companies. Under these decisions they cite. based on geographical region. 1995 Decision? There was good language on the non-bypassability of the CTC.to Supreme Court decisions allowing a “reasonable chance of recovery”. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? We fought AB 1890 because of its putting in place items from the PUC’s December Decision that we hated. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. TURN applauded the focus. but TURN did not like the allocation of CTC costs to different classes. but did include language describing it. and its inclusion of giveaways to large customer groups. The PUC was vague on aggregation. but the incentives were weak. We had advocated a community access model. The Decision made a good commitment to maintaining public purpose programs. Regulated entities can achieve their own version of the truth by repetition. ERG Master’s Project Mark Stout 115 . it was OK for regulators to deny full recovery.

leading to a heated internal debate. requiring a written. there were some self-generation projects in the pipeline.. CPUC vs. we decided not to oppose. AB 1890)? Why? At the end of the process. divested power plants must come with a contract for the original staff for the first two years. we did not oppose or support AB 1890.So we were stuck with a bill that we hated. Unions got a huge bone by having the cost of retraining and severance included in the CTC. Since we felt that it was incrementally better than the December Decision. but Edison successfully created this barrier under the guise of anti-slamming language. so he was amenable to this. We had suggested that community access provide an out for people that did not want in. firmed up the nonbypassability of the CTC. its anti-slamming [slamming is a practice of switching a customers utility provider without their consent] language is really anti-community access language. Also. Is your organization more comfortable with one policy decision over the other (i. In the end. TURN felt it had turned AB 1890. Edison gets coal cost increases.e. Some customers got away with no CTC. and offered a good commitment to low income programs. We had the option of opposing it and jeopardizing the concessions in it. On the bad side. a very. It turns out that independent generation plants are run with much less staff. On the good side. but had to be in the debate. it limited CTC recovery to a shorter period of time. Peace’s residence had gotten slammed a couple times.5 billion increase. but a narrow set of projects. into a very bad bill. ERG Master’s Project Mark Stout 116 . This raises a substantial barrier for municipalities to aggregate their residents’ loads. signed document with independent verification that a customer wants to be included in an aggregation. very bad bill. PG&E gets a $0.

or over time? The terms of the debate changed. trickling down to smaller customers.” The result is that the most favored groups. Nobody gave enough reason for TURN to change its position. We did not do extensive lobbying due to a lack of resources. The process of adding restructuring on top of our normal work is skewed to favor the utilities. PG&E requested direct access for large customers immediately. when the PUC proposals were released. large customers attacked the pool. get attention. with an Edison nuke settlement going on at the time. everybody at TURN wishes we had opposed this bill kicking and screaming. he arranged ERG Master’s Project Mark Stout 117 .In hindsight. The Commissioners were appointed with a viewpoint: “Do what’s right for business. while the utilities where up at the PUC everyday. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? TURN made formal comments at most opportunities. leading to an evolution of positions. In their first round comments to the Blue Book. 1995. and you’ll do what’s right for California. Edison and SDG&E asked for a wholesale pool with transition to direct access. This led to the small customer groups scrambling to get things covered. but just have more refined positions. Fessler’s PoolCo was what Edison wanted. When Wilson got wind of the CMA [California Manufacturers Association] fighting Edison. Unfortunately. These positions were locked until May. people were getting handed new language instantaneously for discussion. We also appeared at full panel hearings. We would still agree with our Yellow Book and Blue Book comments. the process was difficult to track. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. utilities and large industrials.

another small consumer advocacy group] and Greenlining Institute/Latino Issues Forum [low income and minority community advocates]. TURN tried to marshal support with kindred groups UCAN [Utilities Consumers’ Action Network. issue specific attorneys with support staff. Lenny was in the Conference Committee every day. it is tough to stop the momentum. like an armadillo in the middle of the road. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? TURN hoped that if you knocked out enough of the gifts. Public purpose concerns become peripheral. If you can get all of the big dogs to reach consensus. IPPs. Hearings were going on till two or three AM. I went up three or four times. Critical consumer interests were not present. So much of the deal had been cut in advance by large powerful interests. utilities. What was eye opening about working with the Framework Parties [Framework for Restructuring in the Public Interest] was the divergent positions of the environmental groups. unions. with a troika of large customers. ERG Master’s Project Mark Stout 118 . Once Edison was on board for Direct Access.for the meetings leading up to the MOU. The “consensus process” was just everybody taking. the whole thing would fall apart with parties leaving the table. taking care of small consumers would have led to compromise. big customers. nobody gave everything up. Several times people did leave the negotiations. and IPPs [Independent Power Producers]. making it very easy for the Republican Commissioners to adopt. it was all over. TURN contracted with Lenny Goldberg. There were waves of utility employees. supported by the appropriate staff. utilities. they just loaded up the plate. creating a huge advantage to have a fresh mind.

economics. [which] represents 300. depending on interpretation. we are in favor of competition.”94 What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? EDF sought an environmental quid pro quo.Environmental Advocates Environmental Defense Fund Dan Kirshner is a Senior Economic Analyst for EDF. Assuming these problems are resolved.”95 How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20.000 of whom live in California. and law to create innovative. economically viable solutions to today’s environmental problems. “There is no reason to proffer the benefits of competition first to only selected classes of customers.000 members nationwide. EDF supports the earliest possible implementation of direct access for all classes of customers. 3) externality accounting should ensure that customers weigh external costs in their decisions among alternate suppliers. E-1. 1995 Decision? Almost nothing. It gave us nothing until the Legislature tells us otherwise. If focusing 94 CPUC Renewables Working Group. EDF links science. and punted on the details to the Legislature. The Decision was vague. and 4) incentives for uneconomic sales promotion minimized. EDF has participated in California energy policy issues since 1975. more than 55. As stated in EDF’s first round comments on the Blue Book. yes. ERG Master’s Project Mark Stout 119 . if restructuring is implemented properly: 1) energy efficiency investments should continue. 2) an Integrated Resource Planning process should exist for energy efficiency. “a leading non-profit organization.

but in the realm of what we would settle for. Energy efficiency funding was lower than the historical peak.e. Is your organization more comfortable with one policy decision over the other (i. Deregulation is not especially helping energy efficiency.. Vol. The Legislature does have an environmental bone in its body. I am hopeful that buying “green” electricity would be similar to recycling. There is a difference between what you ask for and what you expect. which was never going to get past the industrial customers or utilities. At best case with 25% of residential customers purchasing “green”. There is nothing else to point to for renewables policy. it is a continuation of utility programs with different players. but left to the Legislature.. we wanted one billion. The envisioned split for renewables was about $100 million per year. the PUC did not intend to choose a percentage requirement on the RPS. but the PUC has no environmental bones in it’s body. ERG Master’s Project Mark Stout 120 . we were tied to the language in AB 1123.. AB 1890)? Why? If the PUC was God. that would result in roughly 9% of the electricity sold coming from renewables..on a funding level. and we got 1/2 billion. the Decision may have been better. CPUC vs. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? About 70%. This was informally agreed to by the big boys. which dedicated about 3% of utility revenues to public purpose programs. the Decision had the Renewable Portfolio Standard. For renewable energy funding. the industrial customers thought that 1/2 billion was right. 2. 95 CPUC Status Report on Restructuring. However. By the time of December Decision.

I was concerned that fighting for all renewable funding go to new projects may have caused a backlash. but time will tell on the legislative response. there was not enough activity. ERG Master’s Project Mark Stout 121 . Policy Report on AB 1890 Renewables Funding]. This helped to keep a warm spot with free market ideologues. The outcome was a compromise that nobody liked much. making it difficult to get agreement. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? I left the point contact to John White [the Executive Director of the Center for Energy Efficiency and Renewable Technologies] and Ralph Cavanagh [NRDC’s Energy Program Director]. EDF stated that we were for competition. I spoke several times with Jeff Dasovich in the Strategic Planning Division. I am liking the CEC report [California Energy Commission. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? Past EDF’s filing comments. The selection of the RPS in the Decision gave comfort to people who had a worse uphill climb. I took part in as many full panel hearings as I could get on to. Most direct contact was after the Decision. or over time? Yes.Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. I am surprised that AB 1890 came out as well as it did. It was the threat of a gun that got AB 1890 done. CEERT is a diverse organization. and were sincere about it. EDF did suggest draft language. being difficult to influence the outcome. from the beginning. The process was like watching a movie.

renewables. Advocates of ‘retail wheeling’ systems propose a return to the days when electricity service was run on the discredited principle of ‘the more you use. From their 25 year report. “For retail restructuring to occur. 96 Natural Resources Defense Council. the rules had to be set so that there will be no diminishment in public purpose programs.”96 What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? Initially. as Sheryl explains. RD&D. the lower the unit cost. NRDC is a nonprofit organization that has made a name for itself as a public interest environmental advocate in the courts and policy arenas. where distribution utilities buy power in a competitive wholesale environment for resale to end-use customers in their territory.” As it became clear that opposition to retail restructuring was a losing battle. “see how that works. ERG Master’s Project Mark Stout 122 . low income customers. 1995. Sheryl noted that for energy efficiency and renewables. and universal access. giving interested parties a chance to.Interview #1 Sheryl Carter is a Policy Analyst in the Energy Program at the Natural Resources Defense Council. NRDC advocated for a non-bypassable charge to cover the costs of public purpose programs in such areas as energy efficiency. NRDC adapted with a new position. Sheryl argues that it did not make sense to jump to retail competition before wholesale. NRDC opposed the move to retail restructuring.Natural Resources Defense Council .’ Such systems would be a strong disincentive to utility investment in efficiency and renewable resources--and would not deliver savings to residential customers. “NRDC has emerged as the national leader in fighting proposals to restructure the utility industry in environmentally destructive ways.” Specifically. but supported the introduction of competition through wholesale restructuring.

and not as high as merited. although these were down from pre-Blue Book levels. The December Decisions language on nuclear plant rate structuring did make this link. but had advocated that recovery not be linked to the continued operation of uneconomic plants. Funding levels were roughly the levels being spent by utilities when the bill was drafted. They did not take a position on the percentage level of stranded costs recovery by utilities. NRDC had taken the position that the Renewables Portfolio Standard and a non-bypassable systems benefits charge can work together. They supported this legislation because it set a good precedent. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? NRDC got most of what it wanted in terms of policy mechanisms.a non-bypassable charge mitigates for a lack of integrated resource planning excluded by retail competition. ERG Master’s Project Mark Stout 123 . which was unclear in earlier proposals. the included systems benefits charge was a re-affirmation of public purpose programs. 1995 Decision? NRDC got most of it: a reaffirmation of the need to continue public programs funded through ratepayers. For renewable energy. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. with systems benefits charge funding used for the development of emerging technologies. NRDC can live with AB 1890. however. and not everything they were pushing for. It was not perfect. although the levels for public purpose programs were not what they seeked.

with coalitions of varying members depending on the issue. but instead ensure that the rules were set up to achieve a good outcome. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? One key approach was talking with the Commissioners themselves. They also wanted to make sure the different proposed renewables policies not set up to be exclusive. NRDC also relied on formal comments. They tried to get a mixture of environmental. Ralph Cavanagh. AB 1890)? Why? AB 1890 expanded the rift in the renewables community. and consumer advocates in these coalition visits. Sheryl noted that Peter Miller. The detailed language on renewables left much to be desired. or over time? Yes. In a perfect world. NRDC entered into a public-interest coalition known as the Framework Parties to draft the “Joint Motion for Consideration of Framework for Restructuring in the Public Interest and for Further Public Process.. It is not looking at what is best for the future of sustainability. and talking with staff. ERG Master’s Project Mark Stout 124 . In response to the MOU. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. Joint Response to Memorandum of Understanding”. participation in full panel hearings.e. CPUC vs.Is your organization more comfortable with one policy decision over the other (i. and herself have similar ideologies. low income. Another tactic was a joint public outreach mailing with other environmental organizations including the Union of Concerned Scientists that resulted in letters and telegrams targeted at the Commissioners. They decided to not oppose restructuring. may have been better to specify goals for a renewables policy. NRDC relied on consistent people and tried to be clear throughout.

and increased Edison from $50 million to $90 million per year. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? For energy efficiency funding. I selected him as a second interview subject for this organization because. Natural Resources Defense Council . respectively]. energy efficiency funding levels dropped as soon as renewable energy was placed into the mix of public purpose programs. it became clear that he played a central role in organizing the public interest community during the California restructuring process and would have personal insights that should not be omitted. NRDC also talked one on one with legislators and aids. This got the municipal utilities signed onto the systems benefits charge.What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? The big thing was groundwork prior to the formulation of legislation. it created problems. they may lose out altogether. If the other parties had not understood NRDC’s position. and nobody would have been happy. AB 1890 locked in PG&E and SDG&E where they were [$106 million and $32 million per year. Peace was threatening to handle renewable energy policy himself. The total funding level for public purpose programs increased $600 million ERG Master’s Project Mark Stout 125 . as well as testifying in legislative committee hearings. there would be no chance of consensus on a compromise. During the drafting of Byron Sher’s Assembly Bill 1123. When Steve Peace said no to the RPS. Long meetings were held to make sure renewable energy funding was not left out. It was very clear that if everyone did not work together. as I spoke with other stakeholders. Ralph Cavanagh was important in pulling parties together. During the debate.Interview #2 Ralph Cavanagh is NRDC’s Energy Program Director.

Steve Peace ERG Master’s Project Mark Stout 126 . There was not much one on one with Commissioners or their staff. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? This process occurred over three weeks. including a letter written in the Legislature by Byron Sher and Glen Moore after the Blue Book. NRDC took part in two full panel hearings. More importantly. and this would have been heading to zero if AB 1890 was not passed. Sher was critical in supporting the environmental agenda. NRDC did press work through editorial boards including the San Jose Mercury News. and a utility/ESCO/public purpose coalition on energy efficiency focusing on using a non-bypassable systems benefit charge to sustain historic momentum. in a public forum. CPUC vs. It was negotiated by six legislators with an audience of stakeholders. funding levels laid out. Is your organization more comfortable with one policy decision over the other (i. we worked in three broad coalitions: the Framework Parties. All public purpose funding levels were converted to floors instead of ceilings on spending. energy efficiency programs had The three critical Legislators were the Senators. stakeholders were important for ironing out details. There were other ways we put pressure on the Commission.e. San Francisco Examiner. Meetings between For instance. and was unusual in that regard. a broader coalition of 80 parties on market structure. the San Francisco Chronicle. and the Sacramento Bee focusing on public purpose programs.per year over ‘96.. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? In addition to the formal comments. Over time. AB 1890)? Why? AB 1890 had distinct improvements.

NRDC’s relationship with the IOUs was important. The environmental groups and consumer groups such as TURN worked well together. During our interview. Rich spoke as a representative of Sierra Clubs positions.became more supportive. page 4. orderly development of energy conservation and clean power resources. It was a consensus-based process. Sierra Club/Center for Energy Efficiency and Renewable Technologies Rich Ferguson is the Energy Chair of the Sierra Club California Legislative Committee and the Research Director of CEERT. one on one. to practice and promote the responsible use of the earth’s ecosystems and resources. and UCS. to educate and enlist humanity to protect and restore the quality of the natural and human environments. and protect the wild places of the earth. non-profit organization chartered. We were on separate tracks with industrial customers to ensure no cost shifting occurred. It was strong going in and going out of the process. “To explore. The Sierra Club is a national. If environmental groups collectively walked. these positions are substantially similar to those of CEERT. not turning it into a media tank battle. NRDC. 97 Sierra Magazine. Campaign contributions were meaningless. We were in constant contact. we could have killed it. enjoy. stating that although there were some divergences between the Sierra Club and CEERT positions. May/June 1997. Critical stakeholders who could have derailed did not. the Sierra Club. “a non- profit public education organization dedicated to the sustained. as well as members of the energy efficiency and renewable energy industries.” CEERT’s members include EDF.”97 CEERT is. ERG Master’s Project Mark Stout 127 .

We reached a consensus on the need for independent administration of energy efficiency programs. We had built a commitment to renewables at the Legislature. There were several qualitative outcomes we sought.What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? We did not pay much attention to the Yellow Book. as well as funding for public purpose programs: low income. These got translated into dollars. but considered it a “think piece”. the CPUC. as long as environmental commitments were honored. Industrial Users. Dan Kirshner [see Environmental Defense Fund Interview] and I started meeting with them. CLECA. and agricultural consumers to find out what the environmental community reaction to the restructuring proposal was. Energy efficiency budgets had already been cut. I was concerned that this may become a backdoor way to beat up on environmental programs. and was built into AB 1123 [Byron Sher’s restructuring bill]. California’s implementation of Integrated Resource Planning (IRP)]. There is a lot of waste in some energy efficiency programs. I was approached by CMA. ERG Master’s Project Mark Stout 128 . there was opposition. RD&D. renewables with an incremental cost estimate from the BRPU. Our response was that economics was not the environmental issue. and energy efficiency. we wanted to restore investments at pre-Blue Book levels. and CEC [California Energy Commission]. The 3% of utility revenues for public purpose programs in the MOU came out of these discussions. When the Renewables Portfolio Standard was mentioned. averaging 1993 and 1994. with funding levels based on calculations from the BRPU [Biennial Resource Plan Update. In a series of meetings. About the time of the Blue Book. consumer groups aired their pet peeve with environmental programs.

while the latest CPUC Decision sunsets energy efficiency. Perhaps Commissioner Conlon latched onto the idea of spreading out QF costs amongst different players. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? Because of the lack of acceptance for the RPS. A deal was made with the consumer groups and IOUs: Take a wait and see approach on the duration of renewable and energy efficiency funding. the RPS Working Group is not reality. so Senators Peace and Sher sent a letter to the CPUC pulling the sunset language out for energy efficiency. I do not know why the PUC put it in the Decision. and we won’t need this regulation stuff”. It is a hard call from a policy standpoint: Sierra Club members would love the RPS. ERG Master’s Project Mark Stout 129 . People close to Sacramento knew the RPS did not have a chance. we didn’t want it or not want it. creating a tension. “set up the market. There always was a disconnect between what Nancy Rader [West Coast Representative for AWEA. The customer groups had the same attitude.How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. We did not want to have to pass new legislation. In the PUC Decision. There was a concern that the RPS was seen as ratcheting up the compact of the BRPU [Biennial Resource Plan Update. see interview] thought she got and what she got from the Commission. 1995 Decision? The Renewables Portfolio Standard (RPS) was included in the Decision as a renewables policy [the Sierra Club California Legislative Committee had voted to endorse AB 1202. Energy efficiency and RD&D funding does not sunset in AB 1890. 98 Personal communication with Sierra Club Committee members. an earlier legislative vehicle for the RPS98]. but you have to be a political pragmatist. I knew the consumer groups and power marketers hated it. environmental programs are seen as transitional.

Peace would send the hagglers off. but then unearthed it for AB 1890. When developing a strategy. Fessler did not get the rate of return reduction he wanted. saying that if stranded cost recovery is to be guaranteed. In AB 1890. The magnitude of the CTC collection is bothersome. When the MOU came out. Peace had a hearing back then. I and others agreed. The most outrageous part is special rates for the nukes. I said. and we would go to IEP’s [Independent Energy Producers] office.California’s implementation of integrated resource planning (IRP)] that everyone had agreed to. AB 1890 delivered the $3 billion laid out in the December Decision. see interview] did much of the speaking for low income programs. On public interest RD&D funding. the Sierra Club is not going to make much of a difference. the public interest community wanted a figure closer to the historical average [1994 California IOU ERG Master’s Project Mark Stout 130 . how can you guarantee above market rates for the nukes. Peace poo-pooed the idea at the time. and got angry because PG&E would get paid large sums. but if CMA and CLECA go along. I wrote an article for the CEERT newsletter a few years back on how much money could be saved by shutting down Diablo Canyon and paying PG&E by giving them all of their money back. CTC money is defined as a property right so that future attempts to repeal it can be secured against as a taking. I said that if you want competition. On stranded costs. in case Plan A [the RPS] does not work out. Ralph Cavanagh [NRDC Energy Program Director. Low income advocates insisted their programs were outside of the 3% of revenue cap for other public purpose programs. The SF Bay Guardian [a long time opponent of PG&E] picked up this article. President Fessler was livid. “Do a revenue bond”. you need to make sure you have Plan B. and asked me where to get the money from. one needs to reduce the rate of return on utility investments. The IOUs wanted only $10 million per year.

which will be handled separately as regulated RD&D. I felt double-crossed. and the Sierra Club didn’t endorse. Ralph Cavanagh and I agreed not to go to war on who would handle administration of funds. The final stake through the heart was where the RECs [Renewable Energy Credits] where going. including RD&D for transmission and distribution. they agreed. fearing that if administration of this funding was confused. AB 1890)? Why? Overall. Having QF developers getting them was a political miscalculation. There was an offer on the table for renewables that had been agreed to. we don’t think AB 1890 is a good deal. we didn’t actually get pre-Blue Book levels. ERG Master’s Project Mark Stout 131 . I would have wanted to see what was done with the RPS. but the utilities 99 CPUC RD&D Working Group. III-3. Ralph advocating for utility administration. Is your organization more comfortable with one policy decision over the other (i.]99. On energy efficiency.e. In the end. CPUC vs. First. This was a sore point that had to be finessed between players. we would lose dollars. An argument ensued on how much of this figure would be under their control. In the negotiations. arriving at an agreement of $62. the legislation does a better job.. John White [Sierra Club lobbyist and CEERT Executive Director] was on the fence because of a split in CEERT members. The Framework language [Framework for Restructuring in the Public Interest] said that they would consider an Independent Administrator. The details were left out of AB 1890 on allocation of this money. while I preferred independent administration. the DSM funding levels got dinged. The value of the RECs should go to the contract holder.5 million. Renewables did well funding-wise in AB 1890. App. Since the IOUs got some money for “reliability”. there is the presumption that energy efficiency money would die in the CPUC Decision.RD&D expenditures = $140 million.

What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? We didn’t do grassroots letters. I wrote a paper with goals. Some volunteer leaders wanted to be more vocal on stranded costs. and the IOUs continued their CTC collection for three more months. For developing Sierra Club policy. There was a huge number of meetings between parties.wanted less. meetings going on morning. There were many discussions between parties. and night. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? In addition to filing formal comments. CLECA and CMA build funding levels in. Things were changing too fast. or over time? Yes. We got the Sierra Club level. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. there is a white paper process. but we have learned “when elephants dance. and then making sure they did not get booted off the table. noon. Jan Smutney-Jones [Independent Energy Producers Executive Director. and schlepped it around internally. nobody wants to reopen it. The legislative process lets you get your oar in the water. I would not chime in. If I had nothing new to say at a hearing. we also had contact through meeting with President Fessler. there was not enough time. leaving it up to the lobbyists and insiders to cut a deal. We had influence by having IEP. The legislators outside of the Conference Committee did not have a clue what was in the bill. see interview] and ERG Master’s Project Mark Stout 132 . cutting deals. mice stay away”. The Sierra Club will be more successful if we focus on the environment. We attended the first restructuring weekend down in LA during the summer of ‘94.

Byron Sher was fine. UCS was also opposed to 100% “stranded cost” recovery for utilities. Deregulation of the electricity industry threatened to tear this house of cards down.000 in California”. including 13. As the deregulation process unfolded at the CPUC. “an independent nonprofit public interest organization which works on issues where science and technology play a critical role. was just beginning to be used as a policy option in several states. Jane conjectured that one of the driving forces behind deregulation was to do away with utility requirements that were designed to protect environmental quality. The level of renewables support included in the BRPU served as a target for UCS. Integrated Resource Planning (IRP).John White were the front folks. UCS’s initial position after the release of the CPUC Blue Book Proposal was that the deregulatory roadmap laid out in this proposal was too hasty. As long as the Sierra Club and other groups were happy. Peace was the idea person.000 sponsors nationwide.100 What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? According to Jane. ERG Master’s Project Mark Stout 133 . UCS has 100. Union of Concerned Scientists Jane Kelly is the California Policy Coordinator for the Union of Concerned Scientists. UCS’s overriding goal was to ensure policy were developed that would provide for continued environmental protection with regards to renewables and energy efficiency. pointing towards a future based on environmentally cleaner electricity generation and energy efficiency. E-3. a policy decision that is widely viewed as a financial 100 CPUC Renewables Working Group. manifest in California as the Biennial Resource Plan Update (BRPU).

Jane said that environmental organizations were.” ERG Master’s Project Mark Stout 134 . How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. “did not set public policy so much as doling out money in the transition period.. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? UCS was not at all pleased with the poor support for renewable energy and energy efficiency codified in AB 1890. so UCS also supported low income program protection as defined by coalition partners. “thrown a bone” with the moderate level of public-interest research. “Environmentalist Defends. As for renewable energy.101 To Jane. Jane said the inclusion of the renewables purchase requirement was. 101 Weisman. an allocation that was “responsible public policy”. and demonstration (RD&D) funding. 1995 Decision? UCS was pleased that the CPUC’s December Decision called for a minimum renewables purchase requirement. AB 1890 was not a victory” for environmental goals. and Latino Issues Forum. working in progressive coalitions was important for UCS. with no support for commercialization over a longer duration. “despite other interpretations. The Greenlining Institute.bailout for poor investments in nuclear power generation..” She said the whole battle for continuing renewables support will need to be refought in a few years. development. She also noted that no stakeholders seemed to resist the lack of a cap on surcharge collection for low income programs. “one of a few good pieces UCS was in a position to defend”. the legislation. Jane indicated that. and no guaranteed market for renewable energy. based on the Renewables Portfolio Standard devised by UCS’s coalition partner Nancy Rader of the American Wind Energy Association.

AB 1890)? Why? Jane contrasted AB 1890 with the CPUC Decision. clearly articulated position on the desirability of retail wheeling.. ERG Master’s Project Mark Stout 135 .e. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. while AB 1890 simply doled out ratepayer dollars according to disparate levels of power that special interest groups could bring to the Legislature.Is your organization more comfortable with one policy decision over the other (i. The small consumer advocate community also experienced this rift. [Committee Chairman] Steve Peace was banging heads together. Some environmentalists think retail wheeling threatens environmental protection. a process that she said environmentalists do not usually fare well in. or over time? When asked about UCS’s ability to maintain a consistent position over the CPUC and legislative policy formulation process. Jane noting that The Utility Reform Network. there was a real split in the public interest community as to whether retail wheeling was good or bad for social welfare. stating that the CPUC made a public policy decision for environmental protection. “In the end. CPUC vs. the press had gone home. didn’t have a unified.” An alternative strategy that Jane considered would have been to oppose retail wheeling all the way along. However. relying heavily on Nancy Rader of AWEA and their jointly commissioned lobbyist Joe Caves to represent this position in the heat of the 1996 summer Conference Committee meetings. an organization representing small ratepayers. Jane said that her organization stood firmly behind the stance that the Renewables Portfolio Standard was the best policy for supporting renewables. while some see it as an opportunity for renewable energy generators to increase their markets. and a huge decision was being made behind closed doors.

To compliment this public participation strategy. UCS’s insider approach was composed of elements such as filed comments and full panel hearing testimony by UCS senior energy analyst Donald Aitken. asking them to respond to the CPUC through a Western Union automated fax number.What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? UCS used a dual approach outsider/insider strategy to influence policy formulation at the CPUC.000 faxes to the CPUC demanding that the environment not get forgotten in the policy formulation process. UCS took part in a mailing to 60. resulting in over 2. UCS then planned an outsider strategy that included turning out large numbers of supporters at public hearings. which Jane believes was a response to the effectiveness of UCS’s outsider strategy to generate public support for the RPS. One interesting outcome of the meeting with President Fessler was that he started to lobby Jane and Nancy to support his position. as well as staff people for Commissioners Knight and Conlon. as well as generating a large number of letters to the CPUC. the CPUC deregulation process was thrown open to a much wider spectrum of public input than initially envisioned by the public utility commissioners. UCS volunteers and staff were active at over a number of 1996 Earth Day events throughout ERG Master’s Project Mark Stout 136 . 143 adopted. By helping to get Assembly Concurrent Resolution No. Jane thought this amounted to a level of public pressure that was outside of the usual institutional experience at the CPUC.000 environmentalists in California. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? UCS made use of a similar outsider/insider strategy to influence the legislative outcome. as well as meetings arranged jointly by Jane and AWEA’s Nancy Rader to lobby for the Renewables Portfolio Standard with then-current CPUC President Fessler.

UCS worked closely with AWEA at a June 1996 Senate Utility Committee hearing with both lobbyist Joe Caves and myself advocating for the Renewables Portfolio Standard and AB 1202. Thousands of UCS California activists received letters asking them to write their state senator in support of the Renewables Portfolio Standard. Thousands of UCS Northern California activists and supporters were informed about this opportunity to lobby legislators on renewable energy and energy efficiency issues in a coordinated way.California in April. While Joe continued to lobby Senators. He is currently the counsel for the Oversight ERG Master’s Project Mark Stout 137 . She went on to say that if the whole environmental community was working under a unified strategy. as included in Assembly Bill 1202. gathering dozens of hand written letters from California residents to their state legislators. a legislative education and lobbying event in early August. the legislative outcome would have been different. Jane believes that Clean Power Day was the one unifying experience for environmental and renewable energy organizations throughout an otherwise splintered legislative lobbying process. demanding continued environmental protection and renewable energy development after the transition to a deregulated industry. “progressive legislators did not have the usual suspects all opposing it”. resulting in over two hundred letters to Sacramento. at the very least they could have stopped AB 1890 from passing unanimously. which had passed the Assembly the previous year. State Institutions California Energy Commission Eric Saltmarsh was serving as Staff Counsel in the CEC during the prior CPUC proceedings as well as the past Legislative session. Because of splintering and infighting within the public interest community. counting only those copied to UCS. I worked for UCS coordinating our participation in Clean Power Day.

1995 Decision? The commission did not like the discrete power exchange and ISO. There is a need for much of the same information in both entities. including open transmission access. the Energy Commission had been supportive of core aspects of the proposed generation deregulation. it is really just a clearinghouse. We were more inclined to a unified structure. except for voltage support to let transactions occur. customer direct access. as has been put into place in foreign nations as well as US regional pools. I can understand the concern for the concentration of power in one entity that drove this separation. There is an added cost of having two mandatory entities. What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? Well before the December Decision. and the ISO winds up making schedule changes for physical feasibility anyway. The commission has been supportive of investments with payouts over time for energy efficiency and RD&D.Board which has been created as a result of AB 1890. the completely distinct power exchange and ISO. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. The CEC is a state agency that implements state energy policy and collects data on California energy usage and generation. reciprocity for direct access. The wholesale pool is not really a buyer. We did not share the sentiments as to the structure of the December Decision. and the unbundling of rates and services. ERG Master’s Project Mark Stout 138 . but had trouble applying it to this situation.

. See interviews with Barbara Barkovich and Phil Stohr. the Commission got the outcomes it wanted. 1996 PG&E Rate Restructuring Settlement. A large percentage of AB 1890’s time was taken up on a few issues where the CEC had no positions. Is your organization more comfortable with one policy decision over the other (i. AB 1890)? Why? AB 1890 happened in real time. while the decisions of government institutions generally do not happen that way in terms of scheduling. since this would require holding a meeting with 10 day meeting posting requirements. or over time? Our positions were consistent. they were supportive of their being a real benefit to public purpose RD&D. that there has not been an excessive amount of money spent in the past. [It flowed in large part from the June.] The CEC did believe in the opportunity for reasonable cost recovery.How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? The same concern with the separation of the power exchange and ISO applies in this case also. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. but generalized. The CEC was not in a position to come up with detailed solutions. While the Commissioners may not have endorsed a particular funding level. We had the luxury to legitimately decide on generalized principles. ERG Master’s Project Mark Stout 139 . In general terms there was substantial RD&D funding. all input was technical. We only took generalized policy positions. In core concepts. CPUC vs. There was no opportunity for the Energy Commission to make a policy statement. The calculation of the CTC was not actually addressed in AB 1890.e.

if any other forum we took part in. We also made testimony and participated in CPUC hearings as an examiner. some of which would be “interested”. There was little. They also killed the state agency renewable purchase requirement. were called up to testify on specific issues as an information source only. our Public Affairs Director. and I. This would have required state agencies to ERG Master’s Project Mark Stout 140 . including Assistant Chief Counsel John Chandley. a simple majority is to be unaffiliated with generation. except for when I read into the record a statement for the Energy Commission Chair on the governance of the ISO and PX: they should have a significantly disinterested makeup in order to remove market power influence. For the ISO. These board members will not certainly be disinterested. Edison and PG&E made arguments on takings [with regards to less than 100% stranded cost recovery] and coerced divestiture. The Governor’s office’s participation was punctuated. put in by the renewables community. some members perceived it as a tack-on. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? We were technically relevant in the process. The legislators were in a vacuum trying to figure out how the allocation of public program funding got made. A few people. or distribution companies. transmission. The legislative language has multiple categories that should be included on the power exchange and ISO boards. however.What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? The Energy Commission was a party in every comments filing. There was no advocacy at all. our Executive Director. outside of a disinterested role in hearings and filings. They weighed in against the minimum renewables purchase requirement.

purchase a given percentage of their electricity. a group at the University of California involved with energy efficiency research and development (R&D). for instance by Jud King. This has been affirmed in statements by University Provosts. One would need to augment budgets so the agencies were not hit. After the passage of AB 1890. there were no dollar figures given for public interest RD&D. In this interview. but is instead offering personal observations. California Institute for Energy Efficiency Carl Blumstein is the Associate Director of the California Institute for Energy Efficiency (CIEE). How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? The general policy of the University has been that public goods R&D is a good thing that should be preserved. from renewable generators.5 million public purpose RD&D annual budget. contacts between the two commissions has been informal. The CEC has a role allocating the lion’s share of the $62. University of California. phasing in over time. utility funding for CIEE had been cut off. Consequently. AB 1890 passed unanimously on the floor. he is not representing the position of the University. there was no attempt to amend it. It could have gone further by laying out steps needed in legislation. Also. We were fighting for restoration of this funding from October of ‘94 to December of ‘95. In the process of recent years. ERG Master’s Project Mark Stout 141 . 1995 Decision? We agreed with the stated principles of the Decision. This R&D funding cut provided a concrete example of what was being lost in the move to deregulate the electric utility industry. the Vice-Provost of the UC system. it was vague.

or over time? I think so. Neeper did after the December. CPUC vs.How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? The University supported AB 1890. not end this authority after four years. ‘97 Decision on public purpose programs. Whether or not the Legislature intended this was a point of contention. Conlon attended a briefing a few years back. we did not change our stance. What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? We invited the Commissioners and public interest groups to briefings. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. There is an agreement that the PUC could continue funding after 4 years. briefings to the IOUs were a standard part of the communication.8 million per year.7 per year to the utilities. AB 1890)? Why? I would see them as an appropriate sequence of decisions. but it was a reasonable outcome. Steve Peace and Byron Sher recently sent a letter to the PUC.e. very committed. Fessler attended one earlier. the Legislature or PUC could modify. We have good people involved in research. Is your organization more comfortable with one policy decision over the other (i. More money could have been spent on public interest RD&D. working well together. stating that their intent was that the PUC retain authority for energy efficiency funding. The funding for public interest RD&D will be reviewed after three years. ‘95 decision. Also.. and this comes through in our briefings. Duque was very ERG Master’s Project Mark Stout 142 . compared to just 0. In the February 14. realizing the dollars available for public purpose programs were limited. most public interest RD&D money was allocated to the CEC: $61.

ERG Master’s Project Mark Stout 143 . but they permitted some very big cuts in R&D funding in late 1994. The University is represented by a legislative affairs office. and spoke at one public hearing. We filed comments. The University has a counsel on the PUC service lists. supplemented by several support staff. For the conference committee we had an attorney representing the University. who handle all University issues. they have usually been good.interested in technology and became a CIEE board member. and commented publicly at the Conference Committee. These cuts were part of the utilities' cost cutting efforts that followed the April 20th decision. The Governor can appoint one Commissioner a year. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? We were part of many informal groups discussing the bill. The office has two advocates. We had informal contacts with the CPUC staff. myself and another University employee were there off and on. but not an overwhelming one. They have been favorable in principle the whole way through. Would you say that there is a noticeable difference between Governor Wilson’s CPUC appointees and those from the previous administration? There is no big difference between the two governor’s appointees in sympathy towards public goods R&D. In practice. about five people in the meileu. We had a presence. but nobody dedicated to the PUC proceedings. and their was a steady chatter amongst parties. allowing for inertia.

Anonymous Stakeholder Comments Anonymous Comments #1: Parties who could have improved their performance The renewables and municipal utilities were very poorly represented in hearings. The IOUs wanted to use post-Blue Book. University of California representatives and I advocated for higher. After seven hours of negotiation. historic levels [combined SCE. pre-Blue Book. After they finally recognized the problem ERG Master’s Project Mark Stout 144 . The renewables could have fared much better if they stuck together as a coalition. at one point Steve Peace threw all of the renewables community out of the room to resolve an issue. “Do people have to fail intelligence tests to run a muni?” Anonymous Comments #2: AB 1890 funding levels for Public Interest RD&D The initial funding levels being discussed for public interest RD&D were very low. the renewables community cam back in. current levels for moving to a future restructured market. They proposed to me funding at current RD&D budget levels. They probably thought that this funding level included regulated transmission and distribution RD&D. but they were too busy negotiating other aspects of AB 1890 to followup on my requests for further discussion of RD&D. The municipal utilities angered Peace so much that he asked. and a representative told Peace that the group still had not come to an agreement on who would present the proposal that they still had not negotiated. SDG&E and PG&E RD&D funding fell from over $120 million in 1994 down to just over $60 million in 1995102]. For example. but they allowed me to put in definitions derived from the CPUC RD&D Working Group Report on RD&D [which distinguished between public interest and regulated T&D RD&D] and other language.

would be included back into the bill. I believe that this was done by the IOUs. ERG Master’s Project Mark Stout 145 .5 million in public interest RD&D. I went before the Conference Committee during discussion and it was explained as an error in redrafting. all of the language that I had inserted earlier was removed. All parties agreed that the earlier negotiated language.several nights later. preserving $62.5 million per year funding level for public interest RD&D. including the $62. 102 Chart by Carl Blumstein based on 1995 CEC and PG&E data. at approximately 11:30 PM.

mostly focusing on market structure.Appendix C: Officeholder Staff Interviews California Public Utilities Commission Tom Thompson was a project supervisor in the CPUC’s Commission Advisory and Compliance Division during the December 1995 Decision formulation process. Lobbying access is only as good as a Commissioner’s willingness to meet. resulting in a partial phase in of Direct Access. when ex parte rules are in effect. What methods or strategies did these effective groups use to influence the process? Was any particular method or sets of methods most influential? There was a lot of lobbying. It was conspicuous that an Edison employee always traveled with President Fessler on his trips to Europe. personal meetings with the Commissioners. Which stakeholder groups do you think were most effective in influencing the policy formulation process of the December 1995 Decision and what were they able to obtain from the process? IOUs were most influential. but is instead offering personal observations. He later acted as a project manager of support teams analyzing the drafts of AB 1890. resulting in the most influential stakeholders being granted the most access. with no ex parte rules during the pure rule-making period before December 20. This offered a substantial opportunity for access. Large customers were less influential. he is not representing the position of the Commission. except for a rate cap that was set high anyway. Senate Bill 1960 legislates that there must be a record of who was granted and who was denied ex parte communication. ERG Master’s Project Mark Stout 146 . There was nothing for small customers. In this interview. 1995.

As a result. and why? The Memorandum of Understanding was a major event that brought together two worlds. even though the duration of the CTC recovery period got ERG Master’s Project Mark Stout 147 . adding so much certainty to stranded cost recovery. Ralph Cavanagh was influential in making sure that public purpose programs stayed on the plate. The renewables players were probably asking for too much of the old world the PUC had engaged in. It featured a phase-in of direct access. Which stakeholder groups do you think could have been more effective in influencing the policy formulation process. IOUs and large customers. with the rest of independent power producers looking to a new world of deregulation. with PG&E and SDG&E more willing to move forward on direct access and Edison resisting. as opposed to a revenue freeze. General Comments on AB 1890 AB 1890 endorsed much of the December Decision. The low income groups participated on paper through filed comments. but did not do hall walking to the extent of other groups. a rate freeze created extra revenue for the CTC. fixed price to much lower short run avoided cost]. The investor-owned utilities were split also. Since rates were poised to come down due to the 10-year QF cliffs [when qualifying facility contracts go from a high. It included a rate freeze for the IOUs. Was it always clear what outcomes each stakeholder group wanted from the process? The independent power industry was split. It is important to keep in mind the history of Edison and SDG&E being able to kill the Biennial Resource Plan Update (BRPU) at the FERC. The Commissioners may not have been predisposed to dismantle low income programs. and how could they have improved their approach? Low income advocacy groups did not make their issues big and high-profile like structural issues became. while diverting some money to public purpose programs.Which stakeholder groups do you think were best able to set the terms of the debate. preferring to punt them to Sacramento.

As a sidenote. CLECA. The rate reduction bonds may not yield net present value benefits. so that the [legislative] Members and Governor bought in that restructuring would be good for ERG Master’s Project Mark Stout 148 .shorter compared to the December Decision. The utilities would fight this interpretation. The utilities are trying to get an untaxed ruling from the IRS on these bonds. The PX/ISO’s insertion into Federal jurisdiction was arrogant. The Office of Ratepayer Advocates’ [Tom’s current CPUC division] position is that there is no link between a rate reduction and these bonds. Legislative Conference Committee. but just result in rate deferrals for 10 years. It is tough to sell delayed gratification. Which stakeholder groups do you think were most effective in influencing the policy formulation process of AB 1890 and what were they able to obtain from the process? CMA. as rates were supposed to come down due to the QF cliffs anyway. This reduces the risk of stranded cost recovery to the IOUs. Large businesses articulated the issues. the current criticism of QFs ignores the real competition that they founded. The level of influence on AB 1890 was a function of who was in the Conference Committee hearing room. since the FERC will approve their structure. the PX/ISO Oversight Board is not important. claiming that they are linked. A stakeholder representative recommended that I speak with him because of his level of involvement with the Conference Committee. utilities were fine with the rate freeze. Office of Senator Steve Peace David Takashima is Senator Steve Peace’s Chief of Staff and a former Edison lobbyist. The 10% rate reduction for small customers was final packaging to sell the bill for voters. and WSPA [Western States Petroleum Association]. CMA and CLECA jointly made utility restructuring the issue for business.

California businesses. The utilities. PG&E was the first to come along. so it brought the situation to everyone’s attention. WSPA. There was not much debate or serious discussion in the Assembly. all of it spot bills as opposed to comprehensive legislation. most utilities opposed restructuring. and retailers were all opposed to each other. eventually Edison made the decision. was personally engaged. WSPA made an effort to politically educate officeholders. These parties hoped the Legislature would ratify the MOU as opposed to the PUC vision. DJ Smith of CLECA and Mark Timmerman of CMA were able to organize people. Stan Skinner. agricultural consumers. No one would support the December Decision. The Legislature became the place to find a solution. What methods or strategies did these effective groups use to influence the process? Was any particular method or sets of methods most influential? Coalitions were very important. causing Edison to get very active. PG&E’s President. As a member of CMA’s energy group ($10 thousand membership fee). The Governor’s office needed to figure out if the December Decision needed to stand. This made Edison and SDG&E very uneasy. No one in the Legislature was taking a lead on the issue. Activity at the PUC did not create the political momentum. they were able to then get retailers and agricultural groups on board. All the parties went to the Governor’s office to criticize the PUC. The Legislature did not know whether to engage in this issue. The MOU process was very important because fighting parties came to an agreement. CMA’s energy committee got parties together. There was a lot of legislation in process. PG&E tried to make a lot of accommodations to CMA. ERG Master’s Project Mark Stout 149 . who was also the President of CMA at one time. Initially. George Dunn and Phil Romers from the Governor’s office encouraged the parties to sit down and talk. causing chaos and uncertainty as to what would happen.

He wanted people who would get engaged. It was unclear whether consensus among the Committee Members was going to happen. CMA. Senator Peace was making a decision. Which stakeholder groups do you think could have been more effective in influencing the policy formulation process. but not all six. we have to get everyone to sign off on the bill. you could get four votes. and Edison. It would not have happened without DJ Smith. having conversations with the Governor’s office. Peace’s past experience with workman’s comp reform involved an extensive hearing process. encouraging other people to accept the process who otherwise would not have. CLECA. The Conference Committee tried to put together legislation that made sense. The Committee engaged in months of hearings issue by issue. The California Municipal Utilities Association folks lacked effectiveness also. He had a conversation with Senator Lockyer to staff up the Conference Committee. DJ Smith [CLECA] and Bob Foster [Edison] wanted to make a case to ratify the MOU. Which stakeholder groups do you think were best able to set the terms of the debate. These groups could not come to a resolution. and how could they have improved their approach? The environmental and renewables communities made the Committee punt. decision makers at the table. and Bob Foster. getting everyone engaged for buy-in.During the summer recess in July. could not address the problem of a competitive market and participation. CMA. Senator Peace decided on a process with long discussions. and Edison set the tone. LADWP was trying to cause trouble with restructuring. They were a guiding light. John Rozsa and I were brought on board. They waited until late in the process to get organized. Most parties felt that with the right bill. and why? CLECA. All of the munis were trying to figure out what to do in a restructured world that will not allow residential ERG Master’s Project Mark Stout 150 . They did not want to participate. Peace’s mind was made up. Mark Timmerman.

PG&E proposed a shorter CTC collection period to please Wall Street. they could compare AB 1890 with the December Decision.subsidies on the backs of industrials. The MOU signatories did not include PG&E. A shorter CTC period was beneficial for utilities. yet were not in the hearing for one minute. On the other hand. irrigation districts. The big mistake for these small consumer groups was letting Pete Wilson get elected and stack the PUC with right wing ideologues. or labor unions. Was it always clear what outcomes each stakeholder group wanted from the process? Stakeholders knew what they wanted. They did not think this was going to happen. If the Committee could do something for labor. CalPIRG and some other consumer advocacy groups criticized the process without participating. It took a special relationship and trust between Senators Peace and Leonard to keep things together. This was very irresponsible. They feared the PUC would get jurisdiction over them. they had full opportunity. they could get the unions. but no one knew what the end product would look like. The oil companies had lost their CTC exemption at the PUC. Most parties did not want to go back to the PUC Decision. All of the parties went for an acceptable negotiated solution to avoid litigation or disputes at the PUC. ERG Master’s Project Mark Stout 151 . the conference committee had to balance all interests: IOUs. IOUs wanted full stranded cost recovery. Agricultural consumers wanted CTC exemptions on pumping. they were willing to do the Death March to find the Land of Oz. As for consumer groups. Lenny Goldberg [TURN] was exceptional. labor. but knew if they did not resolve things at the Legislature this would happen. They did not know what they were willing to settle for. They felt if they were willing to participate. a longer period would discount them as marketable stocks. TURN and UCAN participated in every which way. They were helpful and gave useful recommendations. oil companies.

Because of the genius of the legislators.Legislative Conference Committee. and why? The PUC laid out the framework for restructuring in the Blue Book. Senators Byron Sher. There were also “grassroots” astroturf groups based on utility shareholders. establishing a level playing field. Some groups also used press conferences. If your case fit into the unfolding structure. then your voice was heard. A stakeholder representative recommended that I speak with him because of his level of involvement with the Conference Committee. ERG Master’s Project Mark Stout This had to be shaped by pressures on the 152 . One strategy was to get bills established early on in the session. The IOUs spent millions on astroturf such as “Shareholders for Equity”. Which stakeholder groups do you think were best able to set the terms of the debate. Which stakeholder groups do you think were most effective in influencing the policy formulation process of AB 1890 and what were they able to obtain from the process? None were terribly effective. Senator Peace established a process that was a model of openness. based on the free market-driven ideologues on the Commission. Steve Peace. Groups participated in coalition building. The template was in large part formed by the CPUC’s December ‘95 Decision. but it mainly was a waste of money. and Bill Leonard were the masterminds. Office of Senator Byron Sher Kip Lipper is Senator Byron Sher’s Chief of Staff. A lot of PR and press consultants got rich from this. What methods or strategies did these effective groups use to influence the process? Was any particular method or sets of methods most influential? All employed lobbyists. due to the egalitarian nature of the structure. getting a place at the table. lawyers. and accountants. all of the outside lobbying did not matter.

Legislature. This schism was a recipe for having the least influence. It was very unhelpful to have put themselves in that position. Large. Legislative Conference Committee. the residential ratepayers also had trouble. large entities had unified positions. Later on in the Committee. The Decision by the PUC was going to be implemented unless the Legislature was able to deliver a package. As a general matter. as when he threw the munis out of the Committee for their inability to articulate what they wanted. the fact that the renewables and environmentalists were divided was damaging. it is illuminating to get a perspective from one of his key staff who was quite active on the Committee. Renewables and energy efficiency were also guaranteed protection. but the playing field was tilted. He ended up doing quite well. The utilities established early on the full reimbursement for stranded costs. Leonard was a Senator on the Conference Committee during the summer of ‘96. Which stakeholder groups do you think could have been more effective in influencing the policy formulation process. Was it always clear what outcomes each stakeholder group wanted from the process? Peace forced clarity. Peace was demanding in terms of defining your position. Lenny Goldberg from TURN was stellar. and how could they have improved their approach? Early on the munis were not able to define a single coherent position or proposal. and they subsequently came around with an articulated position a day later. considering the situation. ERG Master’s Project Mark Stout 153 . powerful interests already had an advantage from the PUC Decision. fiscally conservative member of the Conference Committee. He threw the munis out. Office of Senator Bill Leonard Delaney Hunter is a Legislative Aide for Republican Assemblyman Bill Leonard. Since several interview subjects described Bill Leonard as a powerful. To a lesser extent.

otherwise blew it up. The full recovery of their stranded assets was very important to them. They also were able to offer a lot of help with technical drafting. and why? When the PUC December Decision came out. This put everything on the table. Which stakeholder groups do you think were best able to set the terms of the debate. He represented himself well in the hearings and actually helped to draft language that made it into the bill. anyone could have influence. Groups that opposed the bill without participating also were ineffective. and how could they have improved their approach? Power marketers such as Enron. and Working Assets were just not there when their issues came up. IOUs very quickly were able to get 100% stranded cost recovery firmed up.Which stakeholder groups do you think were most effective in influencing the policy formulation process of AB 1890 and what were they able to obtain from the process? The IOUs were able to pull people together. as well as an acceleration of recovery. a small generation developer. Wayne Rafesberger. This was the greatest expression of coalition building. A lot of their lawyers did technical language work in coalition with the legislative counsel. was a one-man machine. could not go to a competitive market with a debt hindrance. no one was happy. To contrast this. such as CalPIRG and one of Ralph Nader’s organizations. Which stakeholder groups do you think could have been more effective in influencing the policy formulation process. If they were there and could contribute. they had the manpower to make sure their positions were taken care of. NEVs. The Committee Members took some things from the Decision. What methods or strategies did these effective groups use to influence the process? Was any particular method or sets of methods most influential? Linking up with the Governor’s office was critical. The munis had a hard time articulating how to ERG Master’s Project Mark Stout 154 . They needed to get their nukes off of the books.

Anonymous Officeholder Staff Interview #1 Which stakeholder groups do you think were most effective in influencing the overall policy formulation process and what were they able to obtain from the process? Large customers and the utilities both had the most money to spend. Bill Leonard said that if you want to charge an exit fee. The IOUs got complete stranded cost recovery. Political clout can be bought with lobbying and campaign contributions. Was it always clear what outcomes each stakeholder group wanted from the process? Yes. SB 90 is the vehicle to make the CEC report on allocating renewables funding into statute. causing chaos.maintain an exit fee [for direct access customers leaving their electricity procurement service] without joining the ISO. you must play. and look for ways to get around paying the CTC. Bill Leonard did not historically support ratepayer funding for renewables. The ability to fund politicians helped. What methods or strategies did these effective groups use to influence the process? Was any particular method or sets of methods most influential? Getting the help of the Governor’s office. However. Once the Governor’s office was behind the MOU. it was all over. it was very interesting how the environmentalists and renewables fought each other when it was clear the money had to be split. There was a lot of play between SMUD and the large customers. He walked out at one point to force the munis to make up their mind. such as irrigation districts and economic development rates. while the large customers got the ability to go first on direct access. ERG Master’s Project Mark Stout 155 . It looks most likely that it will be adopted. The IOUs were clear that they wanted full recovery. Labor wanted to protect their employees.

Once something like AB 1890 is done. Was it always clear what outcomes each stakeholder group wanted from the process? No. When the train was leaving the station. while large customers got to move forward with direct access. in the coffee shops at three AM. they did respond with thousands of cards and letters. Which stakeholder groups do you think could have been more effective in influencing the policy formulation process. so there was not enough press coverage. At first. small customers and the people who serve small customers.Which stakeholder groups do you think were best able to set the terms of the debate. They needed to realize the process was happening. As customers learned more about what was going on. and why? Again. not after the fact. IOUs got 100% stranded cost recovery. they were all against restructuring. Also. the large customers and utilities. and how could they have improved their approach? The renewables community fractured itself as far as coming together behind a proposal. you can be part of the decision making process. and pay attention to it then. it is too late to change. There was not enough education or public involvement. This dissipated their effectiveness. Anonymous Officeholder Staff Interview #2 Which stakeholder groups do you think were most effective in influencing the policy formulation process of AB 1890 and what were they able to obtain from the process? IOUs and large consumers got everything they wanted. influencing the CEC’s report to the Legislature. The environmental and consumer advocates did not have a clear idea of what they wanted. As it was too esoteric a topic. ERG Master’s Project Mark Stout 156 . which did not help. If you had the resources to be there. It had too many purists that need to learn the art of compromise. they did not know what seat they wanted to sit in.

For example. However. who deal daily with issues of economic development. Senior Legal Counsel for Edison. Ann sat down and read from the draft during the conference committee. they accounted for 2/3 of the people in the hearing room. This was the first time for the Members to be looking at actual language. Which stakeholder groups do you think were best able to set the terms of the debate. This had validity for Committee Members.What methods or strategies did these effective groups use to influence the process? Was any particular method or sets of methods most influential? These influential players relied on a “fairness and competition” argument to Committee members: equity in access to the grid allowing competition to bring prices down. the ratepayer groups did not jump up and grab it. Between the large manufacturers and utilities. But it was not the number of people in the room that mattered. Which stakeholder groups do you think could have been more effective in influencing the policy formulation process. and how could they have improved their approach? Power marketers and brokers were not as involved. The Governor has the same goal: empower people for economic development. Along the way the draft was changed of course. but the resources that could be allocated. and the conference committee comes back with a 10% rate reduction instead. Ann wrote it and brought it to the Committee for consideration. Often what groups indicated that they wanted was not what they actually wanted. A key witness before the Committee was Ann Cohn. The Committee staff did not write the first draft of the bill. TURN would say they want “X”. So ERG Master’s Project Mark Stout 157 . and why? The same stakeholder groups ran the discussions. Was it always clear what outcomes each stakeholder group wanted from the process? No.

it appeared as if they were not doing that at all. ERG Master’s Project Mark Stout 158 .while the Members were trying to do the right thing.

Interview #1 California Municipal Utilities Association .Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees . California Institute for Energy Efficiency Total note: 1 selects column Rather Little Mixed/Unclear 0 0 Most 3 1 1 1 0 1 1 1 1 1 1 0 0 0 0 0 2 1 1 2 1 1 3 1 1 1 0 1 1 2 1 1 1 0 2 1 1 0 2 1 1 8 1 0 3 10 ERG Master’s Project Mark Stout 159 .Interview #1 Natural Resources Defense Council .Appendix D: Cluster Analysis of Stakeholder Interview Data How much of what you wanted was in the December Decision? INVESTOR-OWNED ELECTRIC UTILITIES Pacific Gas & Electric San Diego Gas and Electric Southern California Edison MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association .Interview #2 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council .Interview #1 Coalition of California Utility Employees .Interview #2 Sierra Club Union of Concerned Scientists STATE INSTITUTIONS California Energy Commission University of California.Interview #1 California Large Energy Consumers Association .Interview #2 INDEPENDENT PRODUCERS American Wind Energy Association Independent Energy Producers LARGE ELECTRICITY CONSUMERS Agricultural Energy Consumers Association California Industrial Users California Large Energy Consumers Association .

Interview #1 Natural Resources Defense Council . California Institute for Energy Efficiency Total note: 1 selects column Rather Little Mixed/Unclear Most 0 0 3 1 1 1 0 2 0 1 1 0 0 2 1 1 1 1 3 1 1 1 1 1 0 0 1 1 1 1 1 1 1 4 1 1 1 1 1 1 . 0 0 1 0 1 1 3 9 10 ERG Master’s Project Mark Stout 160 .Interview #2 Sierra Club Union of Concerned Scientists STATE INSTITUTIONS California Energy Commission University of California.Interview #2 INDEPENDENT PRODUCERS American Wind Energy Association Independent Energy Producers LARGE ELECTRICITY CONSUMERS Agricultural Energy Consumers Association California Industrial Users California Large Energy Consumers Association .Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees .Interview #2 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council .Interview #1 California Municipal Utilities Association .Interview #1 California Large Energy Consumers Association .Interview #1 Coalition of California Utility Employees .How much of what you wanted was in AB 1890? INVESTOR-OWNED ELECTRIC UTILITIES Pacific Gas & Electric San Diego Gas and Electric Southern California Edison MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association .

Interview #2 INDEPENDENT PRODUCERS American Wind Energy Association Independent Energy Producers LARGE ELECTRICITY CONSUMERS Agricultural Energy Consumers Association California Industrial Users California Large Energy Consumers Association .Interview #1 California Large Energy Consumers Association .Interview #1 Natural Resources Defense Council .Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees .Interview #2 Sierra Club Union of Concerned Scientists STATE INSTITUTIONS CPUC DD AB 1890 No preference/Unclear 0 3 0 1 1 1 0 1 1 1 1 1 1 1 1 0 1 1 4 1 1 1 1 0 1 1 3 1 1 1 1 0 0 2 1 1 3 14 4 1 1 0 0 0 0 0 2 1 California Energy Commission University of California. California Institute for Energy Efficiency Total note: 1 selects column ERG Master’s Project Mark Stout 161 .Interview #2 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council .Interview #1 Coalition of California Utility Employees .Which Policy Outcome Does Your Organization Prefer? INVESTOR-OWNED ELECTRIC UTILITIES Pacific Gas & Electric San Diego Gas and Electric Southern California Edison MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association .Interview #1 California Municipal Utilities Association .

191 $2.000 $3.495 $7.500 $22.000 $3.500 $1. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear generation) Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS Adams Steel California Farm Bureau Federation PAC California Manufacturers Association California Mining Association PAC California Steel Industries (CLECA member) Fontana Steel Louisiana Pacific (CMA member) Mitsubishi Cement (CLECA member) National Cement (CLECA member) Riverside Cement (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $4.429 $498 $1.495 $1.995 $21.000 $1.Appendix E: Restructuring Stakeholder Campaign Contribution/Gift Analysis Detail Table 1: Assemblymember Jim Brulte.000 $1.000 $0 $0 ERG Master’s Project Mark Stout 162 . Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.000 $500 $1.000 $7.896 $3.000 $2.495 $10.) California Independent Oil Marketers Association Chevron (CMA member) Mobil Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $22.995 $300 $12.000 $3.000 $495 $950 $696 $2.000 $2.000 $1.800 $1.

990 $1.000 $2.000 $1.995 $14. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades INDEPENDENT PRODUCERS CalEnergy Co.) California Independent Oil Marketers Association California Independent Petroleum PAC Chevron (CMA member) Exxon Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $28.500 $1. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $3.500 $6. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int.000 $1.000 $10.995 $0 $0 ERG Master’s Project Mark Stout 163 .250 $2.017 $749 $750 $3.500 $1.500 $47.Table 2: Assemblymember Jim Brulte. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS Adams Steel California Manufacturers Association California Mining Association PAC California Steel Industries (CLECA member) Fontana Steel Mitsubishi Cement (CLECA member) National Cement (CLECA member) Riverside Cement (CLECA member) Southwest Portland Cement Co.750 $4.495 $4.000 $8.995 $2.460 $200 $500 $750 $2.995 $1.500 $800 $498 $200 $9.000 $1.511 $3.000 $2.

AB 1890 author Assemblyman Jim Brulte accepted no gifts from stakeholders. Paling in comparison. From 3/28/96 to 4/8/96.750 $2.000 $2.000 $750 $0 $0 103 Asmus. by the California Foundation on the Environment and the Economy.500 $1.000 $1.000 $2. Table 3: Senator Steve Peace.000 $3. Chevron treated Brulte to two meals. 4 ERG Master’s Project Mark Stout 164 . totaling $101.000 $1. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int. Sweden.750 $3. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure103.1995/1996 Stakeholder Gift Information for Assemblymember Jim Brulte In 1995. and Privatization” visiting London. CFEE is a “non-profit. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.250 $500 $1. 1996. Brulte was taken on a $7. Mobil treated Brulte to a $60 event in 1996.490 “Travel project to Europe on Electric Restructuring.750 $750 $1. as well as an event. Not to be outdone.000 $1. and Budapest. Conservation. (geothermal) Indpependent Energy Producers OIL AND NATURAL GAS COMPANIES California Independent Petroleum PAC Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $11.

750 $0 $0 ERG Master’s Project Mark Stout 165 .250 $750 $500 $1. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int.250 $2.050 $3.450 $7.815 $750 $6.500 $16.572 $1.000 $300 $1.072 $2.250 $7.600 $2. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.100 $2.Table 4: Senator Steve Peace. (geothermal) California Solar Energy Industry Association Cannon Energy (windpower) Destec (gas-fired) Independent Energy Producers Pacific Lumber Company (solid fuel biomass) SeaWest Windpower Zond Windpower DSM ENERGY SERVICE COMPANIES (ESCOS) SESCO (energy services) LARGE ELECTRICITY CONSUMERS California Manufacturers Association California Retailers Association California Steel Industries (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $6.115 $18.000 $500 $2.250 $1.000 $750 $750 $750 $1.000 $4.000 $1.500 $3.) California Independent Petroleum PAC Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $48.500 $8.

Peace was treated to a $52 sports event by Mobil Oil. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES Southern California Edison/Edison International UTILITY LABOR UNIONS California State Pipe Trades Council PAC INDEPENDENT PRODUCERS Indpependent Energy Producers LARGE ELECTRICITY CONSUMERS SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES California League of Conservation Voters $500 $500 $500 $500 $500 $500 $0 $0 $5.000 Table 6: Senator Byron Sher. taking Steve to 11 meals. In 1995.1995/1996 Stakeholder Gift Information for Senator Steve Peace Given Steve Peace’s prominence as chair of the Conference Committee on Electric Utility Restructuring.100 $2. IEP made a gift of $241 for his speech at a conference. as well as chair of the Senate Energy and Utilities Committee.000 $5.450 166 ELECTRIC/GAS $6. Table 5: Senator Byron Sher. SDG&E pulled on Peace’s ear over a sports event and meal totaling $89. Peace began a practice of reimbursing all utilities for meals and outings starting with Edison in 1995. Southern California Edison was granted a high level of access. SDG&E had Peace out to six meals. In 1996. while Edison treated him to five meals and a sports event. 1996 Campaign Contributions INVESTOR-OWNED UTILITIES Electric Power Research Institute (EPRI) General Electric (nuclear plants) Pacific Gas & Electric ERG Master’s Project Mark Stout $250 $1.900 . he maintained a pretty low profile in 1995 and 1996 in terms of accepting gifts and trips.

(biomass) Edson + Modisette (lobbyist for indep. Brotherhood of Electrical Workers (various $9. and Hamrin. $2.000 $500 $1. of Journeymen & Apprentice Underground Utility/Landscape INDEPENDENT PRODUCERS AES Pacific/SF Energy Co. (geothermal) Colmac Energy Inc.San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS California Workers California State Pipe Trades Council PAC State Association of Electrical $1.000 $500 $500 $9.600 $13.000 locals) Southern California Pipe Trades United Assoc.882 $100 $1. EVs) Hansen. McQuat.482 $100 $1.100 $500 $2. Inc (consultants) $200 ERG Master’s Project Mark Stout 167 .500 Int. (gas-fired) American Wind Energy Association Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co.000 $100 producers.

250 $100 $50 $500 $500 $250 ERG Master’s Project Mark Stout 168 .250 (ESCOS) Appliance Recycling Centers of America Onsite Energy (energy service company) Preferred Energy Services (energy service company) LARGE ELECTRICITY CONSUMERS Adams Steel California Association California Retailers Association California Steel Industries (CLECA member) Louisiana Pacific (CMA member) Schnitzer Steel Industries (CLECA member) OIL AND NATURAL GAS COMPANIES $1.500 COMPANIES $1.000 (tire $1.000 $1.000 $100 $100 $500 $1.Indpependent Energy Producers Modesto burning) SeaWest Windpower United American Energy Wadham Energy Limited Partnership (biomass) Zond Windpower DSM ENERGY SERVICE Energy Limited Partnership $1.000 $1.000 Large Energy Consumers $3.000 $100 $1.

585 $100 $500 $2. (gasoline refining and marketing) SMALL ELECTRICITY CONSUMERS California Association ENVIRONMENTAL ADVOCATES California League of Conservation Voters Energy Foundation Environmental Defense Fund Natural Resources Defense Council Planning and Conservation League Sierra Club California Union of Concerned Scientists STATE INSTITUTIONS U.000 $300 $300 $22.462 $100 $900 $400 $500 ERG Master’s Project Mark Stout 169 . California Institute for Energy Efficiency California Integrated Waste Management Board (biomass proponents) Nevada Community Action $1.000 $700 $4. of California.448 $14.Tosco Corp.

400 $750 $150 $1. Table 7: Senator Bill Leonard. and GE. Sher received no other gifts that year from energy utility stakeholders. the National Association of Regulatory Utility Commissioners (NARUC) bought Sher two plane tickets for quick trips to the Steering Committee meetings of the Electric Utility Restructuring Project.000 in each of Amoco.1995/1996 Stakeholder Gift Information for Senator Byron Sher In 1995. but his Statement of Economic Interest reveals large holding of oil and electricity stocks.500 $300 $0 $0 $2. Exxon. totaling $758. Mobil.300 $500 $1.000 $1. totaling $2608. NARUC treated Sher to a two day trip to DC for another meeting. Sher holds over $100.500 $0 $0 ERG Master’s Project Mark Stout 170 . 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS INDEPENDENT PRODUCERS LARGE ELECTRICITY CONSUMERS California Steel Industries (CLECA member) Riverside Cement (CLECA member) Tamco Steel (CLECA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $3. In 1996.

SCE treated him to a $30 beach party and a $20 lunch with lobbyist Bob Foster. and a $75 dinner at the American Legislative Exchange Council’s annual meeting.080 $10. WA paid $734 for Leonard to moderate a conference session on utility deregulation.000 $1. for a paltry $20. Edison’s lobbyists got to spend a little more quality time with Leonard for their money.) Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $19. saving up for a $77 dinner with head lobbyist Bob Foster. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS California Mining Association PAC California Portland Cement Co.000 $2.000 $5.000 $500 $500 $4. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int.650 $2.500 $500 $1.000 $2. The Pacific Rim Conference of Seattle. (CLECA member) California Steel Industries (CLECA member) Mitsubishi Cement (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co. SDG&E bought Leonard a $125 ticket to the Pete Wilson Inaugural Gala.000 $0 $0 1995/1996 Stakeholder Gift Information for Senator Bill Leonard In 1995.730 $2. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.Table 8: Senator Bill Leonard. SCE treated Leonard to dinner and lodging for Legislative Ski Day.650 $500 $1. Edison again ERG Master’s Project Mark Stout 171 . While the Senator was there.000 $2. extending his stay from 12/8/96 to 12/13/96.000 $1.500 $150 $500 $3. Senator Leonard was courted a little more heavily by energy stakeholders in 1996.

000 $1. ARCO treated Leonard to a $19 meal at a reception. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Joint Electrical Industry Fund Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS California State Association of Electrical Workers INDEPENDENT PRODUCERS Indpependent Energy Producers LARGE ELECTRICITY CONSUMERS Adams Steel Louisiana Pacific (CMA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $1.000 $750 $750 $650 $150 $500 $3. PG&E took Leonard out to a Kings game.250 $750 $0 $0 ERG Master’s Project Mark Stout 172 . for the modest tab of $56. They also had Leonard out for two meals in Sacramento.) Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $6.750 $1. paying $44 for two meals and lodging.600 $1. Table 9: Assemblymember Mickey Conroy.had Senator Leonard out for Legislative Ski Day. including lunch with Bob Foster.600 $750 $750 $500 $1.000 $1.250 $1.

(CLECA member) California Steel Industries (CLECA member) Louisiana Pacific (CMA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.Table 10: Assemblymember Mickey Conroy.700 $750 $450 $250 $250 $1.000 $3. 1996.300 junket to talk with Chinese central government and provincial leaders in Beijing.600 $3. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades INDEPENDENT PRODUCERS Destec (gas-fired) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS Adams Steel California Portland Cement Co.) California Independent Petroleum PAC Chevron (CMA member) Southern Counties Oil Co.000 $5.000 $500 $750 $250 $500 $2.500 $2. Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $9.050 $1. the California Foundation on the Environment and the Economy took Conroy on an 11 day.700 $500 $300 $550 $2.000 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Mickey Conroy In April of 1995. two meals for $44. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS California State Pipe Trades Council PAC Int. Shanghai. PG&E treated him to a basketball game with $51 tickets. 4 ERG Master’s Project Mark Stout 173 .000 $2. and Inner Mongolia. CFEE is a “non-profit. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure104. and to 104 Asmus.000 $500 $2. $7.600 $500 $1.

In terms of investment. with investments of greater than $10. Edison wined and dined the Assemblymember with four meals at $134. and less than 10. and Westinghouse Electrical. it is surprising that no electric utility deregulation stakeholders made any gifts to Assemblymember Conroy in 1996. four rounds of “refreshments” for $30. SDG&E. Kansas City Power & Light.000 each in Edison. Pacificorp. costing $99. After such a busy social calendar in 1995. the Assemblymember seems to have a penchant for electric utilities and nuclear power plant manufacturers. Chevron took Conroy out for two business meals.000 in Orange & Rockland Utilities. ERG Master’s Project Mark Stout 174 . and $25 of cookies and candy.make sure Conroy kept a sweet spot in his heart for them. General Electric. $10 in candy.

) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.750 $4.000 $1.250 $1.750 $2.750 $750 $500 $500 $750 $0 $0 ERG Master’s Project Mark Stout 175 .250 $1.000 $1.750 $2.000 $1.Table 11: Assemblymember Diane Martinez.750 $1. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS California State Pipe Trades Council PAC Int.675 $2.750 $1. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.175 $500 $1. (geothermal) Indpependent Energy Producers OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.

000 $4. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises MUNICIPAL ELECTRIC UTILITIES Gualco Group (lobbyist: Imperial & Modesto Irigatn.500 $1.500 $1.000 $500 $500 $5.750 $1.000 $1.500 $1.000 $500 $3.500 $500 $500 $1. Dist.000 $0 $0 ERG Master’s Project Mark Stout 176 . (geothermal) Destec (gas-fired) Enron Capital & Trade (gas-fired) GWF Power Systems (oil and coal-fired) Pacific Lumber Company (solid fuel biomass) Sithe Energies Co.000 $500 $1.000 $1. (CLECA member) California Steel Industries (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co. (member of IPPs of NY) Zond Windpower LARGE ELECTRICITY CONSUMERS California Manufacturers Association California Portland Cement Co.500 $1.500 $6.000 $4.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $20.000 $7.Table 12: Assemblymember Diane Martinez.000 $1.) UTILITY LABOR UNIONS California State Association of Electrical Workers Int.000 $5.000 $500 $500 $500 $500 $500 $3.250 $1.

000 $500 $500 $1.500 $1.900 $3.000 $1.467 trip to Northwestern University to discuss the deregulation of public utilities.600 $500 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Diane Martinez In 1995.850 $1.) California Independent Oil Producers Chevron (CMA member) Kaiser International Corp.500 $1. (bulk terminals) Mobil Tidelands Oil Tower Energy Group (oil. ERG Master’s Project Mark Stout 177 .208 $0 $0 $1. the Illinois Energy Association flew Martinez out for a $1.Table 13: Assemblymember Steve Kuykendall. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear plants) Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS INDEPENDENT PRODUCERS LARGE ELECTRICITY CONSUMERS Louisiana Pacific (CMA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co. natural gas. The Assemblymember enjoyed no such gifts from deregulation stakeholders in 1996.600 $1. diesel) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.000 $8.058 $500 $500 $1.100 $100 $1.

ERG Master’s Project Mark Stout 178 .) California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Mobil Texaco Tidelands Oil Tower Energy Group (oil.254 $200 $500 $4.500 $1.374 $500 $2.490 “Travel project to Europe on Electric Restructuring.500 $1. and Privatization” visiting London.000 $1. SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $10.Table 14: Assemblymember Steve Kuykendall.500 $0 $1. From 3/28/96 to 4/8/96.989 $500 $500 $0 $0 1995/1996 Kuykendall Stakeholder Gift Information for Assemblymember Steve In 1995. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS INDEPENDENT PRODUCERS Bechtel (gas-fired) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS California Farm Bureau Federation PAC California Mining Association PAC Kaiser Aluminum Louisiana Pacific (CMA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $1.350 $500 $1.374 $4. natural gas. Western States Petroleum Association treated Kuykendall to a reception and a dinner totaling $62. Kuykendall’s social calendar was destined to pick up in 1996.250 $100 $500 $35.000 $500 $2.000 $2. Sweden. diesel) Unocal (CMA member) Victory Oil Co.443 $6. and Budapest. However.000 $1. Kuykendall was taken on a $7.000 $19. Conservation.

Another non-profit organization. for $610. wholesale PoolCo model. 4 ERG Master’s Project Mark Stout 179 . Fessler was taken on a $7. A trade association. “though the CPUC had imposed a ban on communications regarding the Biennial Resource Plan Update (BRPU).”105 The Consolidated Edison IOU spent $1. in Aspen.051 to fly the President out to New York City for a ConEdison Management Conference. government ministers. SC to address their membership. known as the Council of States Government . According to investigative writer Peter Asmus. Chevron treated Kuykendall to two dinners for $131. The Large Public Power Council. The Energy Foundation flew him to Colorado twice for “Future of Utilities” and “Utility Futures IV” meetings. Brussels. to meet with CEOs of the electricity industry.WEST. regulators. spent $516 to fly Fessler to a “Series on Energy Efficiency in the 21st Century”. The Aspen Institute. 1996. a clean power auction the CPUC repeatedly postponed upon the urging of the utility. and Paris. an Edison lobbyist was added to the international travel party at the last minute. CO. Edison. 1994/1995 Stakeholder Gift Information for CPUC President Daniel Fessler From 3/16/94 to 3/27/94.167 junket visiting London. The California 105 Asmus. The California Mining Association took him out for an evening of recreation and dinner costing $89. spent $1402 to fly Fessler to Charleston.916 for the Assemblymember to speak and moderate a panel discussion on electric utility deregulation. and environmental groups to discuss the British experience with deregulation of electricity. a trade association for publicly owned utilities.by the California Foundation on the Environment and the Economy. one of CFEE’s funders. by the California Foundation on the Environment and the Economy. paid $1. was very interested in California moving to the UK-style.

Utah to speak at the “Utility Restructuring. for $467 airfare. On the investment side. in Fort Collins. The Western States Coordinating Council. CO. The Energy Foundation brought him to Dallas and Salt Lake City for the “Utility Futures V and VII meetings. ERG Master’s Project Mark Stout 180 . Kansai Electric utility spent $222 to fly Feeler to roundtable discussions at the NARUC/Kansai Electric Senior Executives Meeting in New York City. PG&E had him out for two lunches. spent $249 to fly him to their annual meeting in Las Vegas. spending $291. the California Foundation on the Environment and the Economy took Fessler on an 11 day. Fessler holds over $10. Finally. DC. Shanghai. The Rocky Mountain Electrical League. The American Enterprise Institute for Public Policy spent $120 for Fessler to make it to their Energy Policy Forum in Washington. and Inner Mongolia. a utility association.802 junket to talk with Chinese central government and provincial leaders in Beijing. for $61. In April of 1995. spent $314 to bring him to speak at their Spring Conference. ZEV’s and Rethinking the Environment Conference. $7. Fessler was flown to The National Association of Energy Service Companies for $249 to speak at their annual conference in Boca Raton. a libertarian think-tank. The Cato Institute. a utility planning association. Synergics Resources Corporation had Fessler out to Princeton.000 in Ohio Edison stock.Energy Coalition flew him to Wyoming to join roundtable discussions at an Aspen Accord Working Group meeting. EEI is a trade association representing investor owned utilities. Finally. the Center for Resource Management flew him to Midway. spending $1006. for $323. DC. had Fessler speak at their conference in Washington. NJ to speak at the 1994 DSM Implementation Conference. The Illinois Power Company spent $427 to bring the CPUC President out to speak at the Edison Electric Institute Joint Executives Symposium.

1995. He does own more than $10. regulators. Knight did not report any electricity deregulation stakeholder gifts in 1994 or 1995. and Schlumberger oilfield services stock. and less than $10. utility and General Electric stock. Brussels. 1994/1995 Stakeholder Gift Information for Commissioner Norm Shumway In February of 1994.000 in each of Montana Power Company and Exxon stock. 1994/1995 Stakeholder Gift Information for Commissioner Jesse Knight.000 in each of Central & Southwest Corp. He does own less than $10. 1994/1995 Stakeholder Gift Information for Commissioner Josiah Neeper Knight did not report any electricity deregulation stakeholder gifts in 1994 or 1995. Jr. 1994/1995 Stakeholder Gift Information for Commissioner Henry Duque Duque did not report any electricity deregulation stakeholder gifts in 1994 or 1995.000 in each of Chevron. and Paris. was very interested in California moving to the UK-style. to meet with CEOs of the electricity industry. one of CFEE’s funders. by the California Foundation on the Environment and the Economy. Conlon was taken on a $7. In 1995. Unocal. wholesale PoolCo model. government ministers. Edison.1994/1995 Stakeholder Gift Information for Commissioner Gregory Conlon From 3/16/94 to 3/31/94. PG&E had him out to three meals for $71. He left office on February 23. The Edison Electric Institute spent $279 to fly the Commissioner to a conference on the results of State Competition in Boca Raton. the Northwest Electric Light and Power Association flew Shumway to their 3rd annual Non-Utility Generation Conference.167 junket visiting London. ERG Master’s Project Mark Stout 181 . and environmental groups to discuss the British experience with deregulation of electricity. spending $258.

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