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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1995 Electric Restructuring Decision. 1 2 CPUC RD&D Working Group. acid rain and climate change. 1994 4 WWW page: http://www.html ERG Master’s Project Mark Stout 4 . California electric utilities have a combined annual revenue of roughly $23 billion dollars1.Introduction On September 23. which will be superseded to a great extent by the details of AB 1890. representing a spectrum of private and public interests attempted to influence both the CPUC and legislative processes.org/programs/Energy/green_power/a_better. selling 250 billion kWh of electricity per year2. 1996 California Energy Commission. 1995 Decision with the California legislative process resulting in AB 1890. Governor Pete Wilson signed into law California Assembly Bill 1890 (AB 1890). Various stakeholder groups. 1995 3 Flavin and Lenssen. contrasting the results of CPUC process resulting in their December. This bill is an important milestone in an ongoing process towards electric utility deregulation in California. This paper develops a comparison of which stakeholder groups got what they wanted. there will probably be significant winners and losers as a result of this legislation. a product with well documented environmental impacts including local air pollution. 1996. with varying success.edf. which sets in motion a process of electric utility deregulation beginning in 1998. and why.3 According to the Environmental Defense Fund.4 Given the stakes involved with this industry. 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.S. fossil fuel-based electricity generation is currently the largest source of greenhouse gas emissions and the largest source of air pollution in the U.

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

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

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

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

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

with large. 2) providing cost recovery for energy efficiency programs that are at least as profitable as supply side measures.supplies.17 A security analyst noted that the release of the Blue Book will: speed up the deregulation of the industry. 1996. all residential consumers eligible on January 1. 55.18 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. The Blue Book laid out an aggressive. 2002. and 3) rate changes to encourage efficiency and distribution of power. 6. sending “a shockwave through the electric industry”. A more definitive policy statement was 16 17 Haddad. 1999. Hoffman. 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.”16 CPUC “Blue Book” Proposal California’s Public Utility Commission is widely viewed as a trend-setter for state PUC electric utility regulation. ERG Master’s Project Mark Stout 12 . 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. the CPUC issued a staff proposal regarding electric utility deregulation known as the “Blue Book”. and if successful. industrial customers taking power at the transmission level eligible on January 1. all commercial customers eligible January 1. customer class-staged schedule for direct access implementation. In April of 1994. 18 Mydans. 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.

1994. prompted the Assembly Committee on Utilities and Commerce and the Assembly Committee on Natural Resources to hold a joint oversight hearing on May 23. This led to the passage of Assembly Concurrent Resolution 143. numerous other states have also proposed electric utility deregulation. Status Report.scheduled to be issued by the CPUC in August of 1994. 1995. Wagner. 1994.21 This stakeholder response. In their place. were concerned about the content and timetable of this proposal. “alternative frameworks based on ‘let the market decide’”. 1995. 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. which had been dubbed the MegaNOPR. and asserted that. including private and public-interest organizations. For instance. where CPUC President Fessler and Commissioner Knight testified on their proposal. coupled with a lack of prior coordination with the state Legislature. such as “green pricing”. pushing back their goal for a policy decision until September of 1995. “a vibrant market exists for energy efficiency services”. Blue Book.20 Many stakeholders. ERG Master’s Project Mark Stout 13 . FERC released a dual-issue Notice of Proposed Rulemaking. evidentiary hearings. the CPUC proposed. 1. where customers voluntarily pay more to promote renewables. 1994. 21 CPUC. This process tempered the CPUC’s frenetic timetable. The first issue addressed open access to the transmission system 19 20 CPUC. and documentation resulting in a report back to the Governor and Legislature by January 31. which requires the CPUC to engage in a series of public hearings. Blue Book.22 FERC MegaNOPR In March of 1995.19 Since the release of the Blue Book proposal.

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

or through the creation of optional pools which could manage bids in a manner similar to the PoolCo proposal. and low-income weatherization would be funded at 25 CPUC Direct Access Proposal ERG Master’s Project Mark Stout 15 . 1995.3% of total utility revenue requirements as of January 1. wholesale pool. although generators would submit projections to an independent system operator (OPCO). California Manufacturers Association. and R&D were not to exceed 3. funding levels for energy efficiency. investor owned utilities in California). No central entity would schedule power generation. as-needed basis. including bilateral contracts for direct access customers.25 In response to the Commissioner proposals. renewables. it is a hybrid of the two proposals. California Large Energy Consumers Association. a group of seemingly influential special interests. Southern California Edison Company (one of three regulated. low-income ratepayer assistance would be funded at an uncapped. 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. Out of this surcharge. who is responsible for maintaining transmission system reliability. as well as a central. Prices would be determined either through bilateral contracts between direct access customers and generators. Full stranded cost recovery is agreed to for Edison. In structure. Bids for generation into the pool would be processed by a Power Exchange (PX). and Independent Energy Producers. know as the “Memorandum of Understanding” (MOU). at the prompting of California Governor Pete Wilson. The MOU also proposed a nonbypassable charge to fund public policy programs.Commissioner Knight’s alternate proposal is based on direct access contracts between generators and customers. met to iron out differences between them and draft their own industry restructuring proposal. the only IOU signing the MOU.

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

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

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

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

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

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

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

. but now had to pay higher rates. 1993. 356-357.51 Academics & Ideologues Neo-classical economists have argued since the 1970’s for the deregulation of the electric utility industry. greatly increasing opportunities for bulk power sales. Advancements in transmission line technology now allow the efficient transmission of electricity for distances of hundreds of miles. ERG Master’s Project Mark Stout 23 .”. 1993. 51 Stevenson.intense pressure from large industrial customers.. Hoffman 55-62. 195. ”49 Technology The development of gas turbine generation technology has greatly reduced the scale requirements for efficient electricity generation. 50 Flavin and Lenssen. Gordon. Davis. who in the past had enjoyed privileged status with cheap rates. “Discretionary Evolution. enabling increased competition. 150. 1994. This reduction in scale has brought down the capital requirements of entering the electricity generation industry. basing their arguments on welfare economics as applied to the changing electric utility landscape.52 The “new industrial organization” espoused by these economists has served as 48 49 Davis. 52 Gilbert.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. 447-475. 84-108.

”. non-utility providers. allowing frequent comparisons between the California Blue Book’s proposed wholesale pool and a similar pool already implemented in the UK.54 Since 1992. Existing Competitive Forces Although electric utilities are often viewed as pure monopolies. the camel of competition forced its nose under the monopoly tent.the academic rationale for the recent flurry of deregulation activity being pushed by free-market ideology.56 Federal Regulatory Policy By requiring utilities to pay avoided costs to the new class of qualifying facilities. such as natural gas for space heating. Examples of national electric utility deregulation have already been provided by the United Kingdom and Norway. over half of new U.53 allowing a policy trend that emphasizes markets rather than social welfare. 355-356. generating capacity has been supplied by alternative. 357. “Discretionary Evolution. Many electrical applications have substitutable fuels.. and it was only 53 54 Stevenson.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. 55 Flavin and Lenssen. ERG Master’s Project Mark Stout 24 ....S. the 1978 Public Utility Regulatory Policies Act greatly invigorated the wholesale market for electric power. as well as those on the border of service districts. “With this act. Utilities compete for industrial customers who are relocating. competition takes on several forms in this market. 1994. There is significant competition in the wholesale electric generation market. Stevenson.”. “Discretionary Evolution.

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

were the key retail wheeling champions within the CPUC. Connecticut.”.. In 1994.. both appointees of Governor Pete Wilson. 1995.61 California Public Utility Commissioners Jesse Knight and Norm Shumway. “Retail wheeling. Massachusetts. New York. “the DOE bill does not mandate retail markets by any date certain. 60 61 Levison.. “Discretionary Evolution.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. “DOE Restructuring Bill” Stevenson.”. Maine.”60 State Regulatory Policy Bidding programs for wholesale electric generation have been established in California. the same year that California’s Blue Book proposal was released. Colorado.”62 a form of integrated resource planning know as the BRPU. They “became increasingly perplexed about the arcaneness and gridlock that seemed to pervade the utility resource planning process. 1997. Commissioner Knight. though it urges states to consider retail competition. a proceeding in which the Commission attempts to determine how much capacity will be needed and structures the acquisition process in great detail.has noted. One of the stated proposals of the Blue Book is to eliminate the Biennial Resource Planning Update (BRPU). an analyst with CPUC’s Division of Strategic Planning. Michigan initiated a five year retail wheeling experiment involving two utilities. Calls for bids have often been oversubscribed by a wide margin. and Wisconsin. according to Jeff Dassovich. 24.. 62 Asmus. 355-356. 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. ERG Master’s Project Mark Stout 26 .

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

“A may exercise power over B by getting him to do what he does not want to do.. but only at a superficial level. “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. on Lukes’ “second face” of power. Goventa. 3-32 ERG Master’s Project Mark Stout 28 . these interviews do not shed much light on the 65 66 Sikkema. 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 a contradiction between the interests of those exercising power and the real interests of those they exclude.” In Lukes’ third. p. power may be analyzed by looking at. and who prevails in decision-making. Their values. As Goventa comments. cannot.. be more effectively objectified. but he also exercises power by influencing. “who participates. eloquently expressed by their participation..” Lukes’ second.. 2. it seems to me. who gains and loses. even without observable actions or non-actions by that institutions agents. or determining his very wants. he argues. 1980. Unfortunately. most “radical” view of power. presumably people participate in those areas they care about the most. I primarily focused on Lukes’ first dimension of power. 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. His onedimensional view of power is based around observable actions by stakeholders.”66 By talking with active stakeholder representatives and officeholder staff. Lukes has argued that there are three views or dimensions of power. observable actions between participants. shaping.negotiations. opening up the analysis to the second view of power. Lukes. 1974. As Polsby has written.

independent producers. 1995. municipal electric utilities. their comments on restructuring filed with the CPUC69. Overview of What the Stakeholders Wanted and What They Got Before analyzing who got what they wanted. 1995. Status Report. based on 26 stakeholder interviews [see Appendix B].. Status Report. environmental advocates.. talking with at least one prominent representative from a number of categories: investor-owned electric utilities. Status Report.67 As I extended my analysis with a summary of campaign contributions from stakeholders to the conference committee members. and a state institutions. large electricity consumers. 69 CPUC.. Selection of Stakeholder Groups In selecting stakeholder groups to focus on. as well as considering those used in a status report from the CPUC to the Legislature. and the final AB 1890 language. the December. I first review what the different stakeholder groups wanted and got in both policy outcomes. 1995.68 I have broken oil and natural gas companies out as a separate category in the tabulations of campaign contributions. CPUC. one important subcategory emerged because of its dominance: Oil and natural gas companies are often both large energy consumers. small electricity consumers. ERG Master’s Project Mark Stout 29 .exercise of power from Lukes’ most “radical” view. 67 68 CPUC. since such a broad analysis would be outside of the scope of this project. utility labor unions.. I tried to cover as wide a range of participants as possible... I chose these categories based on personal experience representing a stakeholder organization in the process. as well as independent producers. 1995 CPUC Decision.

while ensuring their financial solvency. A five year phase-in to direct access may have been a little too fast for Edison. 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 . • Municipal Utilities: The munis want to retain their autonomy in making their own policy decisions. • AB 1890 outcome: The legislation codified the utilities opportunity to recover 100% of stranded costs. including billions of dollars in rate settlements for PG&E’s Diablo Canyon and SCE’s SONGS nuclear plants. and pursue 100% stranded cost recovery from ratepayers. except for on the subject of reciprocity for allowing direct access. • December Decision outcome: The CPUC Decision did not address municipal utilities.” The inclusion of direct access was not embraced by munis. Most resist retail competition. • December Decision outcome: The IOUs did get the ability to recover 100% of stranded costs. 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. which was the strongest proponent of starting with a wholesale-only PoolCo proposal. Most resist retail competition and pursue the ability to recover 100% of stranded costs from ratepayers.• Investor Owned Utilities: The IOUs want to protect shareholders by maintaining their stock price and maximizing profits. While recovery period is limited to four years may limit their ability to achieve the full 100% cost recovery. who are also their “shareholders”. they are comforted by a negotiated settlement that was reached to avoid future litigation.

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

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

As in the December Decision. As with non-renewable independent producers. direct access contracts. and want a choice of their electricity supplier. this industries financial woes are not solely because of deregulation. • Large Industrial & Agricultural Customers: The large consumers want the most efficient. IOUs still have the opportunity to collect 100% of their stranded costs. competitive market possible to drive down rates. with one that had known costs. making them the strongest proponents of direct access. Some argue that the level of funding is too low to maintain the current state renewables base and will end in 2002. large customers won on the inclusion of direct access. • December Decision outcome: Large customers did get the market structure they desired. which could extend until 2005.25 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. • AB 1890 outcome: Again. allowing bilateral. SRAC set according to the Power Exchange market clearing price should result in higher payments to QFs under contract. SRAC set according to the Power Exchange market clearing price should result in higher payments to QFs under contract. However. renewables funding through a systems benefits charge. and AB 1890 does provide a significant amount of money to existing renewables developers to help mitigate any downsizing in the industry. ERG Master’s Project Mark Stout 33 . the RPS. resulting in an industry shakeout. • AB 1890 outcome: Many renewables generators were disappointed with the replacement of a policy mechanism that had known outcomes.independent producers. but limiting the competitive transition charge (CTC) cost recovery to 4. They support granting the IOUs less than 100% stranded cost recovery.

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

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). • December Decision outcome: Environmental advocates lost in their opposition to a market structure allowing direct access. Direct access threatens to undermine both IRP and sales volume/profit decoupling. 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 . while others perceived it as continued charity for poorly-run businesses that had already received more than adequate support. DSM. • AB 1890 outcome: Environmental advocates lost in their opposition to a market structure allowing direct access. 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. as well as in their opposition to the tying of stranded cost recovery to continued operation of nuclear plants.• Environmental Organizations: Environmental organizations want the electric utility industry to evolve into a form which is environmentally and socially sustainable. and public interest RD&D. These groups want to accelerate the removal of coal and nuclear plants from operation. 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. There is a significant rift that has developed over whether existing renewables generators should continue to receive subsidies. although a lack of specific funding levels was troubling. The application of a public goods charge to pay for energy efficiency and public interest RD&D was good in principle. Environmentalists would like to see an end to the backsliding that has occurred in utility energy efficiency and R&D budgets.

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

this provides a baseline to determine if they got what they wanted. As INVESTOR-OWNED ELECTRIC UTILITIES 0 1 2 3 4 5 Figure 1 indicates. as well as the majority of large electricity consumers. say that their organizations got most of what they wanted ERG Master’s Project Mark Stout 37 . When combined with comments filed by that organization early in the restructuring process at the CPUC. 1995 Decision. Figure 2 shows that all of the investor-owned utilities and independent producers. a slightly smaller number of representatives report a mixed or unclear outcome. nearly half of the representatives say that their organization got most of what it wanted from the December Decision. 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. and the remaining minority claim that their organization got rather little.The stakeholder representatives were asked what outcomes their organizations wanted to obtain from the California electric utility restructuring process as it was just unfolding.

say that their organizations got most of what they wanted from AB 1890. 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. 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. as well as the majority of large electricity consumers. and the remaining minority claim that their organization got rather little. As Figures 3 indicates. a similar number of representatives report a mixed or unclear outcome. ERG Master’s Project Mark Stout 38 .from the December Decision. The utility labor unions and municipal utilities representatives reported receiving relatively little from this policy outcome. 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.

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.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. As Figures 5 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. either the CPUC December Decision or AB 1890. as opposed to the nonbypassable surcharge funding mechanism adopted in AB 1890 ERG Master’s Project Mark Stout 39 . most organizations preferred the INDEPENDENT PRODUCERS SMALL ELECTRICITY CONSUMERS LARGE ELECTRICITY CONSUMERS Rather Little Mixed/Unclear Most language of AB 1890.

As excerpted from the PG&E stakeholder interview.[see American Wind Energy Association.” Many of the other stakeholders consider AB 1890 an incremental. STATE INSTITUTIONS Figure 6: What Policy Outcome Does Your Organization Prefer? “Although the CPUC Decision was financially easier on PG&E. PG&E and SDG&E indicated that part of their preference for AB 1890 was to avoid future litigation. forward Decision. and to begin to build theories for why. and Union of Concerned Scientists interviews]. 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. Natural Resources Defense Council #1. I interviewed two subjects who were on the CPUC staff during the two years leading up to the December Decision. 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. as well as three subjects ERG Master’s Project Mark Stout 40 .

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

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

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

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

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

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

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

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

3% of utility revenues. and energy efficiency. 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. “We reached a consensus on. Industrial Users. reduced funding to an average of 2. CLECA. During the Conference Committee hearings. a perusal of legislative language that was proposed during the long. RD&D. agricultural consumers.72 At this point late in the game. EDF. funding for public purpose programs: low income.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. 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. renewables with an incremental cost estimate from the BRPU.” However. less than two weeks before the Bill would be reported out of committee.. hot days of August in the 1996 Conference Committee reveals that this “consensus” funding level took a large hit on August 15. and the Sierra Club. 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 .. roughly $660 million a year for the IOUs alone] of utility revenues for public purpose programs in the MOU came out of these discussions. A legislative outcome related to “green” pricing for renewables provides another example of an ephemeral consensus. TURN was one of several public interest organizations who opposed the change. including IEP. The 3% [it was actually a cap of 3. These got translated into dollars...1% of IOU revenues. As a Sierra Club California legislative chair recounts on meetings between CMA. The August 15 language from a coalition of powerful interests.

This had 73 74 California Senate TV video of August 10. and unpopularity in the eyes of the public. then they are punished by “capital strike”. if they pursue antibusiness policies. the final language of AB 1890 allows IOU customers to voluntarily contribute money to support renewable development.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. receiving “symbolic rewards only”.. There was no significant opposition to this point during the hearing. groups whose inclusion coincides with no imperative will not easily acquire the tangible goods they value. 1996 ERG Master’s Project Mark Stout 50 .. 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. States simply must provide the conditions that facilitate capitalist investment and economic growth.” An anonymous staffer’s comment also resonated with this state imperative. public interest organizations have been “co-opted or bought off cheaply”..influential players relied on a “fairness and competition” argument. As noted earlier. subdivision (e) 75 Dryzek. . one Senator’s Chief of Staff revealed. “.74 Dryzek has voiced concern that by accepting a seat at government policymaking tables.for a static amount of renewables capacity. As he explains. recession. “Large businesses articulated the issues. section 381.. They may be allowed to participate in the policymaking process. so that the [legislative] Members and Governor bought in that restructuring would be good for California businesses.73 However. 75 The state imperative of “accumulation” came up several times during interviews with officeholder staff.. 1996 Conference Committee on Electric Restructuring AB 1890.. but outcomes will be systematically skewed against them.. To the extent that public policy remains under the sway of state imperatives.. falling tax revenues.

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

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

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

000 $225.079 $13.835 $1.588 $500 $32.479 $2.675 $736. 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.149 $3.203.125 $0 $4.496 $8.370 $648 N/A $0 $208.995 $596.608 $3.758 $2.239 $0 N/A $0 $89.500 $1.000 $634.180 $0 $209.000 $562.000 N/A $0 $18.102 $0 $73.516.416 $5.675 $384.000 $480.500 $533.157 $0 $188.000 $62.818 $0 $65.630 $300 N/A $0 $5.092 $3.079 $950 $14.964 $0 $40.981 $1.031.110 $34.592 $846 $0 ERG Master's Project Mark Stout 54 .S.819 $0 $323. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co. (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 $59.096 $971.000 $0 $70.163 $0 $25.419 $13.405 $0 $722.112 $3.153 $750 N/A $8.595 $0 $21.1995 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear plants) Joint Electrical Industry Fund Pacific Gas & Electric/U.559 $0 $246.181 $0 $160.374 $1.752 $0 $51.500 $78.272 $0 $64.075 $4.741 $21.000 $681.500 $190.308 $516.000 $1.500 $263.101 $495 $10.470 $10.745 $68.952 $1.166 $5.

291 $3.000 $0 $6.197 $500 N/A $2.947 $500 $281.500 $0 $0 ERG Master's Project Mark Stout 55 .000 $37.319 $0 $10.665 $0 $262.600 $32.271 $0 $12.400 $100 $79.099 $12.723 $0 $38.675 $0 $1.000 $383.055 $0 $151.596.519 $11.362.850 $1.083 $0 $20.000 $0 $15.230. (bulk terminals) Mobil Texaco Tidelands Oil Tosco Corp.207 $5.081 $1.167 $500 $25.701 $0 $5.495 $1.145 $5.600 N/A $5.495 $27.000 $524.000 $526.716 $39. natural gas.203 $0 $30. (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. (gasoline refining and marketing) Tower Energy Group (oil.551 $12.326 $0 $100.401 $1. 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 $4.250 $0 $30.492 $0 $66.938 $0 $118.000 $20.203 $5.1995 Lobbying Totals RMC Lonestar (CLECA member) Southwest Portland Cement Co.003.000 $0 $171.

819 $921.590 $5.) 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.281 $1.118 $0 $144.750 $418. (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) $145.250 N/A $100 N/A $2.017 $1. EVs) Enron Corporation (gas fired) GWF Power Systems (oil and coal-fired) Hansen.750 $267. Dist.195 $401.589 $26.724 $500 not applicable $500 $57.000 $50.000 $33.717 $500 not applicable $0 $138. (biomass) Destec (gas-fired) Edson + Modisette (lobbyist for indep.S.500 N/A $0 $211.500 N/A ERG Master's Project Mark Stout 56 .782 $981.400 $1.179 $0 $3.600 $276.000 $209.229 $100 N/A $1.862 $21.000 NA $500 $0 $2. of Jrnymn & Aprt Underground Utility/Landscape Utility Workers Union of America INDEPENDENT PRODUCERS AES Pacific/SF Energy Co. and Hamrin.905 $30.1996 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Electric Power Research Institute General Electric (nuclear plants) Pacific Gas & Electric/U.331 $0 $97.025.750 $1.100 $0 $500 N/A $100 $0 $500 N/A $2. McQuat.454 $3. (geothermal) California Cogeneration Council California Solar Energy Industry Association Cannon Energy (windpower) Colmac Energy Inc.032 $0 $172.845 $452. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades United Assoc.748 $32.147 $500 $739.500 $29.286 $3.000 $35. producers.000 N/A $100 N/A $7.060 $6.450 $566.917 $300 $5.250 $148.100 $144. 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 $1.626 $0 $8.571 $500 N/A $200 N/A $1.240 $0 $178.200 $837.882 $15.543 $29. 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.460 $50. (gas-fired) American Wind Energy Association Bechtel (gas-fired) Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co.159 $3.000 $85.605 $250 N/A $1.

960 $2.636 $0 $103.137 $550 N/A $5.407 $200 $61.661. 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) $41.334 $498 $1.000 $65.878 $12.478.750 $37.622 $67. Texaco Tidelands Oil Tosco Corp.000 $233.016 $1.689 $2.521 $14.495 $22.521 $0 N/A $50 $87.138 $1.250 $34. (gasoline refining and marketing) Tower Energy Group (oil.958 $2.721 $748.245 $335.181 $1.000 $500 $456.1996 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.511 $1.500 $47.500 $251.050 $949.780 ERG Master's Project Mark Stout 57 .750 $23.800 not tracked $3.573 $2.950 $3.177 $300 N/A $0 $29.072 $918.650 $3. diesel) Unocal (CMA member) Victory Oil Co.050 N/A $0 $214.900 $1. natural gas.900 $0 $21.438 $500 N/A $0 $1.384 $2.000 $22.532 $4.296 $800 $25.417 $9.000 $76.754 $4.521 $1.347 $9.989 N/A $9.705 $19.885 $300 $207.861 $1.500 $277.995 N/A $100 N/A $0 $3.643 $1.090 $749 $38. (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.209. (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.925 $0 $44.761 $0 $73.712 $100 N/A $200 $16.

066 $500 $21.068 $14.000 $15.378 $100 $21.000 $900 N/A $400 N/A $500 N/A ERG Master's Project Mark Stout 58 .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.790 $100 $14.438 $4.000 $700 $117.462 $208. 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 $500 $14.585 $33. of California.000 $2.448 $424.066 $500 N/A $250 N/A $22.250 $21.

alternative energy producers. including oil and natural gas companies. government ministers. and environmental groups to discuss the British experience with deregulation of electricity. According to investigative writer Peter Asmus. 1996. 4 ERG Master’s Project Mark Stout 59 . Brussels. an Edison lobbyist was added to the international travel party at the last minute.”80 In April of 1995. the lobbying summary tables above. and Privatization” took AB 1890 author Jim Brulte and Conference Committee 79 80 Asmus. 1996. to meet with CEOs of the electricity industry. and Inner Mongolia. 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. their “Travel project to Europe on Electric Restructuring. and small consumer groups. as well as the legislator breakdown tables and gift descriptions in Appendix E show that IOUs and large consumers. Conservation. CFEE is a “non-profit.800 each. 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. regulators. “though the CPUC had imposed a ban on communications regarding the Biennial Resource Plan Update (BRPU). for $7. a clean power auction the CPUC repeatedly postponed upon the urging of the utility. and Paris. paying up to $7. 4 Asmus. From 3/28/96 to 4/8/96.As one would imagine. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure. CPUC President Fessler and Commissioner Gregory Conlon were taken by CFEE on an excursion visiting London.79 From 3/16/94 to 3/27/94.167 per guest. were able to far outspend environmental organizations (who were usually spread thin over many issues). Shanghai.

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

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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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. 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 .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. AB 1890)? Why? Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. 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. CPUC vs. and why? Which stakeholder groups do you think could have been more effective in influencing the policy formulation process.

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

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

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

Sirard. and gas service to 0. E. Jack. while holding on to what they really wanted. a gas utility which serves a territory largely overlapping with Southern California Edison’s. SDG&E. “People who influenced the outcome were present. It allows an organization to get buy-in from other parties in advance. San Diego Gas and Electric Jim Cassie is the Director of State Governmental Affairs for SDG&E.” according to Kathy. SDG&E provides service to 1.”82 Enova Corporation has announced a merger with Pacific Enterprises. “a subsidiary of Enova Corporation. and willing to be straightforward on what they can give on. the parent company of Southern California Gas Company83. 82 83 CPUC Renewables Working Group. ERG Master’s Project Mark Stout 70 .” Organizations had to be able to make decisions right on the spot to shape the outcome.15 million electric customers in San Diego and southern Orange Counties. 1996. “Uncertain road ahead for utilities” and Enova Corporation 1996 annual report. App.7 million customers in San Diego County. 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. 1996. is a California Investor Owned Utility Company founded in 1881. Kathy said that what mattered most in influencing the formulation of AB 1890 was responsiveness to Steve Peace’s requirements.reasonableness check.

We went to FERC. 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. 84 CPUC Renewables Working Group. We were strongly opposed to the RPS. we had the highest rates in the nation. Also. The lucky Arizona utilities went with coal. everyone should pay. [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. High priced renewables are OK if you are not moving to a competitive future. but are not viable with competition. ERG Master’s Project Mark Stout 71 .84] SDG&E does not have any renewables. We were very opposed to the BRPU. and got it struck down. so we would have to buy energy or credits. This would put us at a competitive disadvantage compared to PG&E and Edison. AB 1890 mirrors the Decision in many ways. they did not get there by investing in high cost renewables. if you are a broker. When Tom Page came in as CEO in 1981. with the exception of the legislation’s mechanism for a rate reduction. SDG&E was a supporter of the PoolCo market structure along with Edison. SDG&E wanted to become the lowest priced California IOU. 1996. Throughout the ‘70s. except for electricity purchases from Mexican geothermal generators. it would be difficult to get 5% renewables.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. It does not make sense for SDG&E alone to go out and acquire more expensive renewable resources.

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

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

Southern California Edison Tommy Ross is the Director of Public Affairs at the Sacramento office for SCE. The regulatory compacts that we entered into need to be recognized. and served as a basis for AB 1890. be we did get a principled ERG Master’s Project Mark Stout 74 . opportunity. based on number of customers. don’t rock the boat utility.2 million customers in Central and Southern California. equity. I would not say we got everything we wanted. let’s do this the right way. This is best implemented under a transition. so we decided if this was going to come into play.”86 What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? In early 1995. large and small customers. We also pursued the opportunity for a return on investment. 000 square mile service territory has a population of more than 11 million. not “the big guys eat first”. First. a manifestation of these mutual interests. we adopted a principled approach that recognized the interests of Edison. were equity. Over time. We could have been perceived as opposing direct access. creating a level playing field. 1995 Decision? Those three principles were significant components of the December Decision. Our three principles. and other energy service providers. The 109-year old investor owned utility serves more than 4. With the encouragement of the Governor’s office. all customers should at the same time. If any customers are to benefit. The utility’s 50. with a phase-in to direct access. “the nation’s second largest utility. and SCE investors as well as independent energy producers should have the opportunity for a return on investment. restructuring came to be viewed as inevitable. and return on investment. we were positioned as an anti-restructuring. 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)? Why? We were satisfied with AB 1890. ERG Master’s Project Mark Stout 75 . CPUC vs. We will not know how Edison faired until after the transition. or over time? Absolutely. we were very consistent. putting language in the statute made it more likely to get a known outcome. E. We made sure they knew 86 CPUC Renewables Working Group. and CTC exemptions. we do not know how it will turn out. 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.. We could always ask what principle is driving a requested amendment. App. it validated the direction taken by the December Decision. Since regulatory changes are subject to regulatory whims.e. it is best to adopt a principled approach. Since there are still issues for Edison around stranded cost recovery. This allowed us to be consistent. otherwise you may open up doors to places you do not want to go. Is your organization more comfortable with one policy decision over the other (i.approach which recognizes the different parties interests. 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. Generally. 1996. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. in terms of headroom for shareholder returns. This made for touchy meetings with the parties. All AB 1890 represents is an unfolding framework.

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

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

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

California Municipal Utilities Association . CMUA lobbied people. 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. but did spend significant time with Committee members. but were perfectly willing to see no ERG Master’s Project Mark Stout 79 . muni levels rising. 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. spending more time negotiating with other parties.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. Stuart Wilson [see previous interview] recommended that I speak with him also to gain additional insights. CMUA went in very concerned about collecting stranded costs. Edison made threats that AB 1890 would be just as prescriptive for munis as it was for IOUs. It was better to stay with it than not have any leverage. IOU levels dropping. 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”. Peace blew up when he realized he was dealing with an equation that would not balance. We had sponsored legislation to assure no customers could avoid paying the CTC.Interview #2 Jerry Jordan is the Executive Director of CMUA. The pending rate decrease for IOUs provided a cushion for restructuring. Munis have overlap constituencies in ratepayers and citizen shareholders. we did not oppose the Decision. CMUA presented a slide graph showing rate forecasts. forcing the legislation. Because of this. CMUA filed comments.

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

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

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

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

Munis can be divided into two groups: those that are creature of city governments. They were not camping out at the Capital. Comments on municipal utilities and taxation: LADWP [Los Angeles Department of Water and Power. and Director of Public Affairs. We do not have a lobbyist at the CPUC. but came in for visiting with the staff and members two or three times each. including through the CMUA. more at stake. which does not include campaign contributions. putting in 1/3 to 2/3 of my time. 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. LADWP is a creature of LA. In addition to myself. Assistant General Manager. there were three other people with direct contacts: SMUD’s General Manager. we have to play things straight up. causing concern with other munis. 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. but do send attorneys to represent us. As a public agency. We also networked our position with other utilities. and those that are independent. so be it.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. If the city council needs this transfer to balance the budget. There are also hybrids that fall in between such as ERG Master’s Project Mark Stout 84 . 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. 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.

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

and responsiveness to customer inquiries. a technical consultant to CUE [see preceding interview]. but with a rational transition.Interview #2 Marc Joseph is an attorney actively representing CUE through both the CPUC and legislative tracks. the existing unions get a contact for two years of plant operation. when a utility plant is divested to a new company. there are no savings to customers to be gained from retail competition.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. 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. ERG Master’s Project Mark Stout 86 . but criteria of reliability and quality of service. increasing efficiencies without sacrificing reliability and service. a result where the only criteria was not cents/kWh. we shifted to focus on generation. We already had viable wholesale competition. and distribution reliability. transmission. Coalition of California Utility Employees . and how the market should be shaped. We initially focused on whether. Most customers want more than incremental savings. Marc was referred to me by David Marcus. We are willing to compete. As it became clear that this argument would be lost. We pointed out that the only part of the industry subject to competition was the variable cost of energy. The legislation also attempts to ensure the reliability of the system by building in responsibility for inspection and maintenance into the new regulatory structure. Enron now agrees with us. Also. and to what extent.

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

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

the essential elements of the RPS were included in the MRPR so that AWEA could largely get what they wanted. efficient policy mechanism. Although she says the Decision language was vague. ERG Master’s Project Mark Stout 89 . 22 consultants. with implementation details to be worked out through a CPUC stakeholder Renewables Working Group process. 10 project developers/operators. the MRPR was. including 155 members in California. She mentioned that another stumbling block for the 90 CPUC Renewables Working Group.” from the California electric utility deregulation process. “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. includes 7 turbine manufacturers. However.” for supporting renewable electricity generation. E-1. The RPS.”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. which Nancy and I found to be clearly outside of the purview of the Working Group’s charter. 12 accessory parts manufacturers.AWEA’s 750 members. Nancy had developed the RPS concept for AWEA since being hired on.” EDF led a coalition with the only non-MRPR proposal in the CPUC Renewables Working Group. “corrects market failures and market barriers. 1995 Decision? Nancy was successful in getting the RPS embodied in the CPUC’s Decision as a minimum renewables purchase requirement (MRPR). such as the Renewables Portfolio Standard. 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 is a long-term. academicians and interested individuals.

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

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

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

we influenced the Memorandum of Understanding that was released in August of 1995.] 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. 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. IEP also sought to maintain a policy for resource diversity in the mix of generation. 1995 Decision? Overall. [SCE succeeded in killing the BRPU at the Federal level in 1995. they had moved from using California’s Standard Offer process as a vehicle for the expansion of the independent power sector. the MOU allowed the restructuring process to move forward. ERG Master’s Project Mark Stout 93 . but not allowed to talk. The BRPU had resulted in 1300 MW of contracts before being struck down. Over time. Ensuring the sanctity of existing contracts is our highest priority. independent producers were better off working with customers. and included a policy for maintaining resource diversity. For IEP. Initially. By allowing utilities an opportunity to recover 100% of their stranded costs. In May. Over time. IEP was invited to the meetings. IEP did well from restructuring. the CPUC Biennial Resource Plan Update. 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. to spending millions of dollars developing California’s integrated resource planning process. A large portion of the MOU is reflected in the December Decision.and represents a diverse group of gas and coal-fired cogeneration and renewable energy plants. Direct access is a tool for future development. 300 MW set aside for renewable generation. the Decision allowed for a direct access market developing.

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

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

Agriculture had been fuel switching for a number of years. playing a significant role in planning and cost overruns. To the PUC. Now others are precluded by the non-bypassability of the CTC which will not allow for competition. This is based on input from growers. the nukes were not. While we recognized that contracts with QFs were forced. The IOUs were able to protect the whole concept of CTCs. Giving choices to folks will lower rates.“Law generates push for gas-fired power plants”]. a lobbing group representing all farm groups in California except for those represented by the Farm Bureau. An irrigation district is a type of water district. but lost everything else. Finally. and distribute electricity. 1995 Decision? AECA got direct access with a slow phase-in. which has significant power to buy. 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. who have a choice in all of their other commodity inputs. three have. ERG Master’s Project Mark Stout 96 . Although more than 70 irrigation districts never have sought to utilize this power. the fact that Enron [large. Then there is the announcement by SCE that they will be divesting 100% of their generation. We also desired that the IOUs share in some of the burden of their stranded costs. sell. This got traded away. 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. 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. non-bypassable meant something.

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

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

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

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

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

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

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

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

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

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

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. need-based level. 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. but as Dan Fessler was fond of saying. 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 add needed education and protection programs in order to at least maintain the status quo for small consumers. We realized it was not realistic to resist retail competition as TURN had tried in telecommunications. The December Decision did a fairly good job in recognizing low income ERG Master’s Project Mark Stout 111 . our goal was to protect as much of the old programs as possible. “the devil is in the details”. such as non-english speaking customers.Small Electricity Consumers Latino Issues Forum Latino Issues Forum. I do not think small consumers will benefit from retail competition. We also wanted to fund low-income weatherization programs at as high a level as possible. In some ways this was not a very lofty goal. a non-profit organization advocating for Latino Californians. In addition. but it was realistic. We wanted to keep the CARE (California’s Alternative Rates for Energy) program funded at an uncapped. Jane Kelly of UCS [see interview] recommended that I talk with someone at this organization. Overall. The interview subject preferred to remain anonymous. 1995 Decision? In an outline form. everything was included.

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

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

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

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

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

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

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

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

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

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

96 Natural Resources Defense Council.” Specifically. “see how that works. NRDC opposed the move to retail restructuring. renewables.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. as Sheryl explains. the lower the unit cost. giving interested parties a chance to. where distribution utilities buy power in a competitive wholesale environment for resale to end-use customers in their territory. “For retail restructuring to occur. NRDC is a nonprofit organization that has made a name for itself as a public interest environmental advocate in the courts and policy arenas. ERG Master’s Project Mark Stout 122 . 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. low income customers.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. RD&D. 1995.”96 What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? Initially.” As it became clear that opposition to retail restructuring was a losing battle. and universal access. “NRDC has emerged as the national leader in fighting proposals to restructure the utility industry in environmentally destructive ways. the rules had to be set so that there will be no diminishment in public purpose programs. Sheryl argues that it did not make sense to jump to retail competition before wholesale. NRDC adapted with a new position. Sheryl noted that for energy efficiency and renewables. but supported the introduction of competition through wholesale restructuring.

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

Joint Response to Memorandum of Understanding”. AB 1890)? Why? AB 1890 expanded the rift in the renewables community. ERG Master’s Project Mark Stout 124 . may have been better to specify goals for a renewables policy. and consumer advocates in these coalition visits.e. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. Sheryl noted that Peter Miller. They tried to get a mixture of environmental. 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 decided to not oppose restructuring. participation in full panel hearings. The detailed language on renewables left much to be desired. and talking with staff.. In response to the MOU. NRDC also relied on formal comments. In a perfect world. They also wanted to make sure the different proposed renewables policies not set up to be exclusive. 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. with coalitions of varying members depending on the issue. NRDC relied on consistent people and tried to be clear throughout. CPUC vs.Is your organization more comfortable with one policy decision over the other (i. and herself have similar ideologies. or over time? Yes. but instead ensure that the rules were set up to achieve a good outcome. low income. Ralph Cavanagh. It is not looking at what is best for the future of sustainability. 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 was very clear that if everyone did not work together. I selected him as a second interview subject for this organization because. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? For energy efficiency funding. During the drafting of Byron Sher’s Assembly Bill 1123. NRDC also talked one on one with legislators and aids. Peace was threatening to handle renewable energy policy himself. and nobody would have been happy. Natural Resources Defense Council . During the debate. AB 1890 locked in PG&E and SDG&E where they were [$106 million and $32 million per year. When Steve Peace said no to the RPS. respectively]. The total funding level for public purpose programs increased $600 million ERG Master’s Project Mark Stout 125 . and increased Edison from $50 million to $90 million per year. 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.Interview #2 Ralph Cavanagh is NRDC’s Energy Program Director. Ralph Cavanagh was important in pulling parties together. there would be no chance of consensus on a compromise. as I spoke with other stakeholders. as well as testifying in legislative committee hearings. it created problems. they may lose out altogether. 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. If the other parties had not understood NRDC’s position. energy efficiency funding levels dropped as soon as renewable energy was placed into the mix of public purpose programs. Long meetings were held to make sure renewable energy funding was not left out.

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

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

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

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. while the latest CPUC Decision sunsets energy efficiency. and we won’t need this regulation stuff”. It is a hard call from a policy standpoint: Sierra Club members would love the RPS. creating a tension. There was a concern that the RPS was seen as ratcheting up the compact of the BRPU [Biennial Resource Plan Update. I do not know why the PUC put it in the Decision. There always was a disconnect between what Nancy Rader [West Coast Representative for AWEA. ERG Master’s Project Mark Stout 129 . Energy efficiency and RD&D funding does not sunset in AB 1890. but you have to be a political pragmatist. environmental programs are seen as transitional. I knew the consumer groups and power marketers hated it. “set up the market. In the PUC Decision. The customer groups had the same attitude. We did not want to have to pass new legislation. 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. 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. Perhaps Commissioner Conlon latched onto the idea of spreading out QF costs amongst different players. 98 Personal communication with Sierra Club Committee members. we didn’t want it or not want it. 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. an earlier legislative vehicle for the RPS98]. see interview] thought she got and what she got from the Commission.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. People close to Sacramento knew the RPS did not have a chance.

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

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

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

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

101 To Jane. The Greenlining Institute. She also noted that no stakeholders seemed to resist the lack of a cap on surcharge collection for low income programs.” She said the whole battle for continuing renewables support will need to be refought in a few years. “one of a few good pieces UCS was in a position to defend”. so UCS also supported low income program protection as defined by coalition partners. an allocation that was “responsible public policy”. “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. and demonstration (RD&D) funding. the legislation. Jane indicated that. As for renewable energy. “thrown a bone” with the moderate level of public-interest research. Jane said the inclusion of the renewables purchase requirement was. “despite other interpretations. 101 Weisman. 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.” ERG Master’s Project Mark Stout 134 .bailout for poor investments in nuclear power generation. AB 1890 was not a victory” for environmental goals. 1995 Decision? UCS was pleased that the CPUC’s December Decision called for a minimum renewables purchase requirement. with no support for commercialization over a longer duration.. 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 Latino Issues Forum. development. Jane said that environmental organizations were. working in progressive coalitions was important for UCS. “Environmentalist Defends.

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

One interesting outcome of the meeting with President Fessler was that he started to lobby Jane and Nancy to support his position. UCS took part in a mailing to 60. the CPUC deregulation process was thrown open to a much wider spectrum of public input than initially envisioned by the public utility commissioners. resulting in over 2. UCS then planned an outsider strategy that included turning out large numbers of supporters at public hearings.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. asking them to respond to the CPUC through a Western Union automated fax number. 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. UCS volunteers and staff were active at over a number of 1996 Earth Day events throughout ERG Master’s Project Mark Stout 136 . as well as staff people for Commissioners Knight and Conlon. 143 adopted. 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. which Jane believes was a response to the effectiveness of UCS’s outsider strategy to generate public support for the RPS. 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.000 faxes to the CPUC demanding that the environment not get forgotten in the policy formulation process. By helping to get Assembly Concurrent Resolution No.000 environmentalists in California. Jane thought this amounted to a level of public pressure that was outside of the usual institutional experience at the CPUC. as well as generating a large number of letters to the CPUC.

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

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

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

We also made testimony and participated in CPUC hearings as an examiner. A few people. our Executive Director. They also killed the state agency renewable purchase requirement. outside of a disinterested role in hearings and filings. For the ISO. 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. They weighed in against the minimum renewables purchase requirement. put in by the renewables community. There was no advocacy at all. if any other forum we took part in. some of which would be “interested”. were called up to testify on specific issues as an information source only. a simple majority is to be unaffiliated with generation. There was little. These board members will not certainly be disinterested. The Governor’s office’s participation was punctuated. and I. Edison and PG&E made arguments on takings [with regards to less than 100% stranded cost recovery] and coerced divestiture. including Assistant Chief Counsel John Chandley. our Public Affairs Director. or distribution companies. 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. The legislators were in a vacuum trying to figure out how the allocation of public program funding got made. This would have required state agencies to ERG Master’s Project Mark Stout 140 . The legislative language has multiple categories that should be included on the power exchange and ISO boards. 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. some members perceived it as a tack-on. transmission.

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

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

The University is represented by a legislative affairs office. and spoke at one public hearing. In practice. We filed comments. about five people in the meileu.interested in technology and became a CIEE board member. The office has two advocates. The University has a counsel on the PUC service lists. We had informal contacts with the CPUC staff. These cuts were part of the utilities' cost cutting efforts that followed the April 20th decision. but not an overwhelming one. and commented publicly at the Conference Committee. For the conference committee we had an attorney representing the University. We had a presence. allowing for inertia. They have been favorable in principle the whole way through. they have usually been good. but they permitted some very big cuts in R&D funding in late 1994. supplemented by several support staff. who handle all University issues. but nobody dedicated to the PUC proceedings. and their was a steady chatter amongst parties. 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. 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. The Governor can appoint one Commissioner a year. ERG Master’s Project Mark Stout 143 . myself and another University employee were there off and on.

The renewables could have fared much better if they stuck together as a coalition. The municipal utilities angered Peace so much that he asked. After they finally recognized the problem ERG Master’s Project Mark Stout 144 . University of California representatives and I advocated for higher. historic levels [combined SCE. SDG&E and PG&E RD&D funding fell from over $120 million in 1994 down to just over $60 million in 1995102]. 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. but they were too busy negotiating other aspects of AB 1890 to followup on my requests for further discussion of RD&D. They probably thought that this funding level included regulated transmission and distribution RD&D. The IOUs wanted to use post-Blue Book. They proposed to me funding at current RD&D budget levels.Anonymous Stakeholder Comments Anonymous Comments #1: Parties who could have improved their performance The renewables and municipal utilities were very poorly represented in hearings. 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. For example. After seven hours of negotiation. 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. pre-Blue Book. the renewables community cam back in. current levels for moving to a future restructured market.

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

There was nothing for small customers. Lobbying access is only as good as a Commissioner’s willingness to meet. resulting in a partial phase in of Direct Access. resulting in the most influential stakeholders being granted the most access. He later acted as a project manager of support teams analyzing the drafts of AB 1890. Senate Bill 1960 legislates that there must be a record of who was granted and who was denied ex parte communication. 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. with no ex parte rules during the pure rule-making period before December 20.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. when ex parte rules are in effect. personal meetings with the Commissioners. mostly focusing on market structure. In this interview. Large customers were less influential. 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. This offered a substantial opportunity for access. ERG Master’s Project Mark Stout 146 . he is not representing the position of the Commission. but is instead offering personal observations. It was conspicuous that an Edison employee always traveled with President Fessler on his trips to Europe. except for a rate cap that was set high anyway. 1995.

The low income groups participated on paper through filed comments. As a result. It featured a phase-in of direct access. fixed price to much lower short run avoided cost]. with the rest of independent power producers looking to a new world of deregulation. The renewables players were probably asking for too much of the old world the PUC had engaged in. Which stakeholder groups do you think could have been more effective in influencing the policy formulation process. and why? The Memorandum of Understanding was a major event that brought together two worlds. a rate freeze created extra revenue for the CTC. even though the duration of the CTC recovery period got ERG Master’s Project Mark Stout 147 . It included a rate freeze for the IOUs. Ralph Cavanagh was influential in making sure that public purpose programs stayed on the plate. 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. Since rates were poised to come down due to the 10-year QF cliffs [when qualifying facility contracts go from a high.Which stakeholder groups do you think were best able to set the terms of the debate. The Commissioners may not have been predisposed to dismantle low income programs. adding so much certainty to stranded cost recovery. while diverting some money to public purpose programs. 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. with PG&E and SDG&E more willing to move forward on direct access and Edison resisting. IOUs and large customers. Was it always clear what outcomes each stakeholder group wanted from the process? The independent power industry was split. preferring to punt them to Sacramento. as opposed to a revenue freeze. The investor-owned utilities were split also. General Comments on AB 1890 AB 1890 endorsed much of the December Decision. 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 rate reduction bonds may not yield net present value benefits. The utilities would fight this interpretation. The Office of Ratepayer Advocates’ [Tom’s current CPUC division] position is that there is no link between a rate reduction and these bonds. utilities were fine with the rate freeze. The PX/ISO’s insertion into Federal jurisdiction was arrogant. As a sidenote. Office of Senator Steve Peace David Takashima is Senator Steve Peace’s Chief of Staff and a former Edison lobbyist. A stakeholder representative recommended that I speak with him because of his level of involvement with the Conference Committee. CLECA. It is tough to sell delayed gratification. This reduces the risk of stranded cost recovery to the IOUs.shorter compared to the December Decision. CMA and CLECA jointly made utility restructuring the issue for business. The utilities are trying to get an untaxed ruling from the IRS on these bonds. and WSPA [Western States Petroleum Association]. Legislative Conference Committee. Large businesses articulated the issues. but just result in rate deferrals for 10 years. the current criticism of QFs ignores the real competition that they founded. so that the [legislative] Members and Governor bought in that restructuring would be good for ERG Master’s Project Mark Stout 148 . the PX/ISO Oversight Board is not important. The level of influence on AB 1890 was a function of who was in the Conference Committee hearing room. 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. since the FERC will approve their structure. claiming that they are linked.

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

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

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

due to the egalitarian nature of the structure. A lot of PR and press consultants got rich from this. A stakeholder representative recommended that I speak with him because of his level of involvement with the Conference Committee. 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. all of the outside lobbying did not matter. Because of the genius of the legislators. and Bill Leonard were the masterminds. getting a place at the table. The IOUs spent millions on astroturf such as “Shareholders for Equity”. and accountants. but it mainly was a waste of money. Which stakeholder groups do you think were best able to set the terms of the debate. lawyers. The template was in large part formed by the CPUC’s December ‘95 Decision. Some groups also used press conferences. Senator Peace established a process that was a model of openness. establishing a level playing field. Office of Senator Byron Sher Kip Lipper is Senator Byron Sher’s Chief of Staff. Senators Byron Sher. and why? The PUC laid out the framework for restructuring in the Blue Book. ERG Master’s Project Mark Stout This had to be shaped by pressures on the 152 . There were also “grassroots” astroturf groups based on utility shareholders. 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.Legislative Conference Committee. One strategy was to get bills established early on in the session. then your voice was heard. Groups participated in coalition building. If your case fit into the unfolding structure. Steve Peace. based on the free market-driven ideologues on the Commission.

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

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

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

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

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

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

Interview #1 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 #2 Sierra Club Union of Concerned Scientists STATE INSTITUTIONS California Energy Commission University of California.Interview #1 Natural Resources Defense Council .Interview #2 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council . 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 #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees .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 #1 Coalition of California Utility Employees .

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 Municipal Utilities Association .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 . 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 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 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council .Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees .Interview #1 Natural Resources Defense Council .Interview #1 California Large Energy Consumers Association .

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.Interview #1 California Municipal Utilities Association .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 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 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 . California Institute for Energy Efficiency Total note: 1 selects column ERG Master’s Project Mark Stout 161 .Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees .Interview #1 Natural Resources Defense Council .

429 $498 $1.000 $3.000 $4.800 $1.000 $2.000 $7.Appendix E: Restructuring Stakeholder Campaign Contribution/Gift Analysis Detail Table 1: Assemblymember Jim Brulte.000 $0 $0 ERG Master’s Project Mark Stout 162 . Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.896 $3.000 $1.191 $2.) California Independent Oil Marketers Association Chevron (CMA member) Mobil Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $22.495 $1.000 $1.000 $3.495 $7. (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 $2.500 $1.000 $500 $1.000 $3.000 $495 $950 $696 $2.500 $22. 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.995 $300 $12.000 $1.495 $10.995 $21.

500 $47.990 $1.000 $8.500 $800 $498 $200 $9.995 $0 $0 ERG Master’s Project Mark Stout 163 .500 $1.000 $1.511 $3.995 $1.500 $6.000 $3.000 $1.995 $2.250 $2.000 $2.Table 2: Assemblymember Jim Brulte.017 $749 $750 $3.000 $1.500 $1.000 $2.000 $10. 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. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades INDEPENDENT PRODUCERS CalEnergy Co.995 $14.495 $4.460 $200 $500 $750 $2.750 $4.) California Independent Oil Marketers Association California Independent Petroleum PAC Chevron (CMA member) Exxon Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $28. (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.

totaling $101. by the California Foundation on the Environment and the Economy. as well as an event.750 $3. AB 1890 author Assemblyman Jim Brulte accepted no gifts from stakeholders.000 $1.000 $3.750 $2.490 “Travel project to Europe on Electric Restructuring. 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.000 $1. From 3/28/96 to 4/8/96. Table 3: Senator Steve Peace. CFEE is a “non-profit.000 $1. Brulte was taken on a $7. Chevron treated Brulte to two meals. 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 1995.000 $2. and Privatization” visiting London.500 $1. Mobil treated Brulte to a $60 event in 1996.750 $750 $1.000 $750 $0 $0 103 Asmus. 4 ERG Master’s Project Mark Stout 164 . Sweden. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co. (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. 1996. and Budapest. Not to be outdone.000 $2. Conservation. Paling in comparison.250 $500 $1.

100 $2.072 $2.Table 4: Senator Steve Peace.250 $7.000 $4. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.250 $750 $500 $1.572 $1.000 $500 $2.115 $18.500 $8.500 $3.) California Independent Petroleum PAC Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $48.450 $7.000 $6.750 $0 $0 ERG Master’s Project Mark Stout 165 .000 $300 $1.815 $750 $6.050 $3. 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. (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.250 $1.500 $16.250 $2.000 $1.600 $2.000 $750 $750 $750 $1.

while Edison treated him to five meals and a sports event. as well as chair of the Senate Energy and Utilities Committee. Table 5: Senator Byron Sher. Southern California Edison was granted a high level of access. SDG&E had Peace out to six meals. IEP made a gift of $241 for his speech at a conference.900 . Peace was treated to a $52 sports event by Mobil Oil. taking Steve to 11 meals.1995/1996 Stakeholder Gift Information for Senator Steve Peace Given Steve Peace’s prominence as chair of the Conference Committee on Electric Utility Restructuring. 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. In 1995.450 166 ELECTRIC/GAS $6. Peace began a practice of reimbursing all utilities for meals and outings starting with Edison in 1995. In 1996.000 Table 6: Senator Byron Sher. SDG&E pulled on Peace’s ear over a sports event and meal totaling $89.100 $2. 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 $1.000 $5. he maintained a pretty low profile in 1995 and 1996 in terms of accepting gifts and trips.

Inc (consultants) $200 ERG Master’s Project Mark Stout 167 .000 $500 $1. $2. and Hamrin. (gas-fired) American Wind Energy Association Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co.000 locals) Southern California Pipe Trades United Assoc.600 $13. (geothermal) Colmac Energy Inc.882 $100 $1.482 $100 $1. McQuat.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 $1.100 $500 $2. (biomass) Edson + Modisette (lobbyist for indep.000 $100 producers.500 Int.000 $500 $500 $9. Brotherhood of Electrical Workers (various $9. of Journeymen & Apprentice Underground Utility/Landscape INDEPENDENT PRODUCERS AES Pacific/SF Energy Co. EVs) Hansen.

000 $1.000 (tire $1.000 $100 $1.Indpependent Energy Producers Modesto burning) SeaWest Windpower United American Energy Wadham Energy Limited Partnership (biomass) Zond Windpower DSM ENERGY SERVICE Energy Limited Partnership $1.250 $100 $50 $500 $500 $250 ERG Master’s Project Mark Stout 168 .000 Large Energy Consumers $3.250 (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 $1.000 $1.000 $100 $100 $500 $1.500 COMPANIES $1.

462 $100 $900 $400 $500 ERG Master’s Project Mark Stout 169 .585 $100 $500 $2.Tosco Corp. (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 $700 $4.448 $14. California Institute for Energy Efficiency California Integrated Waste Management Board (biomass proponents) Nevada Community Action $1. of California.000 $300 $300 $22.

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. Table 7: Senator Bill Leonard. Sher received no other gifts that year from energy utility stakeholders. and GE. totaling $2608.000 $1. Exxon. NARUC treated Sher to a two day trip to DC for another meeting. Mobil. 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. totaling $758.000 in each of Amoco.500 $300 $0 $0 $2.400 $750 $150 $1. but his Statement of Economic Interest reveals large holding of oil and electricity stocks.500 $0 $0 ERG Master’s Project Mark Stout 170 .300 $500 $1. Sher holds over $100. In 1996.1995/1996 Stakeholder Gift Information for Senator Byron Sher In 1995.

730 $2.000 $500 $500 $4.080 $10.000 $2.) Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $19. SDG&E bought Leonard a $125 ticket to the Pete Wilson Inaugural Gala. 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. (CLECA member) California Steel Industries (CLECA member) Mitsubishi Cement (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co. The Pacific Rim Conference of Seattle. Senator Leonard was courted a little more heavily by energy stakeholders in 1996.000 $0 $0 1995/1996 Stakeholder Gift Information for Senator Bill Leonard In 1995.000 $1.650 $500 $1.Table 8: Senator Bill Leonard.000 $5.000 $2. WA paid $734 for Leonard to moderate a conference session on utility deregulation. saving up for a $77 dinner with head lobbyist Bob Foster. Edison again ERG Master’s Project Mark Stout 171 . Edison’s lobbyists got to spend a little more quality time with Leonard for their money.650 $2. extending his stay from 12/8/96 to 12/13/96. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS California Mining Association PAC California Portland Cement Co. for a paltry $20. SCE treated him to a $30 beach party and a $20 lunch with lobbyist Bob Foster. SCE treated Leonard to dinner and lodging for Legislative Ski Day.000 $2.000 $1.500 $150 $500 $3. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co. and a $75 dinner at the American Legislative Exchange Council’s annual meeting. While the Senator was there.500 $500 $1.

Table 9: Assemblymember Mickey Conroy. 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. including lunch with Bob Foster.750 $1.600 $1. paying $44 for two meals and lodging.had Senator Leonard out for Legislative Ski Day. PG&E took Leonard out to a Kings game.000 $1.250 $1.) Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $6. They also had Leonard out for two meals in Sacramento. for the modest tab of $56.600 $750 $750 $500 $1.000 $1. ARCO treated Leonard to a $19 meal at a reception.000 $750 $750 $650 $150 $500 $3.000 $1.250 $750 $0 $0 ERG Master’s Project Mark Stout 172 .

1996.300 junket to talk with Chinese central government and provincial leaders in Beijing.000 $2. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure104.000 $5.) California Independent Petroleum PAC Chevron (CMA member) Southern Counties Oil Co. the California Foundation on the Environment and the Economy took Conroy on an 11 day.000 $500 $750 $250 $500 $2.600 $500 $1.700 $500 $300 $550 $2.000 $500 $2. CFEE is a “non-profit.050 $1. and to 104 Asmus. PG&E treated him to a basketball game with $51 tickets. (CLECA member) California Steel Industries (CLECA member) Louisiana Pacific (CMA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co. two meals for $44.000 $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.Table 10: Assemblymember Mickey Conroy. Shanghai. Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $9. 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. 4 ERG Master’s Project Mark Stout 173 .500 $2.000 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Mickey Conroy In April of 1995.600 $3.700 $750 $450 $250 $250 $1. $7. and Inner Mongolia.

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

750 $750 $500 $500 $750 $0 $0 ERG Master’s Project Mark Stout 175 .175 $500 $1.750 $1.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.750 $4.675 $2.250 $1.000 $1.750 $1.250 $1.750 $2.000 $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 California State Pipe Trades Council PAC Int.750 $2. (geothermal) Indpependent Energy Producers OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.000 $1.Table 11: Assemblymember Diane Martinez.

(CLECA member) California Steel Industries (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $500 $500 $5.000 $5.000 $4.750 $1.000 $4.500 $1.000 $1.000 $500 $500 $500 $500 $500 $3.500 $6.000 $500 $1.) UTILITY LABOR UNIONS California State Association of Electrical Workers Int. Dist.000 $7. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.500 $1.000 $1.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $20.500 $1.500 $500 $500 $1. (member of IPPs of NY) Zond Windpower LARGE ELECTRICITY CONSUMERS California Manufacturers Association California Portland Cement Co.Table 12: Assemblymember Diane Martinez. 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.000 $0 $0 ERG Master’s Project Mark Stout 176 .000 $1. (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.250 $1.500 $1.000 $500 $3.

natural gas.500 $1. (bulk terminals) Mobil Tidelands Oil Tower Energy Group (oil.000 $500 $500 $1.000 $8.100 $100 $1.) California Independent Oil Producers Chevron (CMA member) Kaiser International Corp.000 $1.500 $1. 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. ERG Master’s Project Mark Stout 177 .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 1995.900 $3.Table 13: Assemblymember Steve Kuykendall. diesel) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.208 $0 $0 $1.600 $1. The Assemblymember enjoyed no such gifts from deregulation stakeholders in 1996. the Illinois Energy Association flew Martinez out for a $1.058 $500 $500 $1.850 $1.

000 $500 $2. Sweden.000 $1. Kuykendall’s social calendar was destined to pick up in 1996.490 “Travel project to Europe on Electric Restructuring. 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.374 $4.Table 14: Assemblymember Steve Kuykendall.000 $2.000 $1.989 $500 $500 $0 $0 1995/1996 Kuykendall Stakeholder Gift Information for Assemblymember Steve In 1995.000 $1.000 $19. diesel) Unocal (CMA member) Victory Oil Co. Conservation. However.254 $200 $500 $4.374 $500 $2. and Privatization” visiting London. natural gas.500 $1. Kuykendall was taken on a $7.350 $500 $1.443 $6. Western States Petroleum Association treated Kuykendall to a reception and a dinner totaling $62.250 $100 $500 $35.500 $1. ERG Master’s Project Mark Stout 178 .500 $0 $1. SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $10. From 3/28/96 to 4/8/96. and Budapest.) California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Mobil Texaco Tidelands Oil Tower Energy Group (oil.

A trade association. The California Mining Association took him out for an evening of recreation and dinner costing $89.by the California Foundation on the Environment and the Economy. CO. The Large Public Power Council. 4 ERG Master’s Project Mark Stout 179 . “though the CPUC had imposed a ban on communications regarding the Biennial Resource Plan Update (BRPU). known as the Council of States Government . by the California Foundation on the Environment and the Economy. The California 105 Asmus. 1994/1995 Stakeholder Gift Information for CPUC President Daniel Fessler From 3/16/94 to 3/27/94. paid $1. an Edison lobbyist was added to the international travel party at the last minute.167 junket visiting London. Edison. and Paris. and environmental groups to discuss the British experience with deregulation of electricity. According to investigative writer Peter Asmus.”105 The Consolidated Edison IOU spent $1. in Aspen.WEST. SC to address their membership. spent $516 to fly Fessler to a “Series on Energy Efficiency in the 21st Century”. The Aspen Institute. regulators. was very interested in California moving to the UK-style. Brussels. wholesale PoolCo model. a trade association for publicly owned utilities. a clean power auction the CPUC repeatedly postponed upon the urging of the utility. one of CFEE’s funders. for $610. government ministers. to meet with CEOs of the electricity industry. Chevron treated Kuykendall to two dinners for $131. Fessler was taken on a $7. 1996. The Energy Foundation flew him to Colorado twice for “Future of Utilities” and “Utility Futures IV” meetings. spent $1402 to fly Fessler to Charleston.916 for the Assemblymember to speak and moderate a panel discussion on electric utility deregulation.051 to fly the President out to New York City for a ConEdison Management Conference. Another non-profit organization.

spending $1006. On the investment side. spending $291. ZEV’s and Rethinking the Environment Conference. DC. ERG Master’s Project Mark Stout 180 . CO. The Energy Foundation brought him to Dallas and Salt Lake City for the “Utility Futures V and VII meetings. EEI is a trade association representing investor owned utilities. the California Foundation on the Environment and the Economy took Fessler on an 11 day. a utility association. and Inner Mongolia. The Cato Institute. Finally. DC. Finally. $7. had Fessler speak at their conference in Washington. Utah to speak at the “Utility Restructuring. NJ to speak at the 1994 DSM Implementation Conference. Fessler was flown to The National Association of Energy Service Companies for $249 to speak at their annual conference in Boca Raton. for $323.802 junket to talk with Chinese central government and provincial leaders in Beijing.000 in Ohio Edison stock.Energy Coalition flew him to Wyoming to join roundtable discussions at an Aspen Accord Working Group meeting. a utility planning association. Synergics Resources Corporation had Fessler out to Princeton. for $467 airfare. Shanghai. spent $314 to bring him to speak at their Spring Conference. The American Enterprise Institute for Public Policy spent $120 for Fessler to make it to their Energy Policy Forum in Washington. In April of 1995. in Fort Collins. PG&E had him out for two lunches. The Western States Coordinating Council. The Rocky Mountain Electrical League. a libertarian think-tank. Fessler holds over $10. The Illinois Power Company spent $427 to bring the CPUC President out to speak at the Edison Electric Institute Joint Executives Symposium. Kansai Electric utility spent $222 to fly Feeler to roundtable discussions at the NARUC/Kansai Electric Senior Executives Meeting in New York City. for $61. the Center for Resource Management flew him to Midway. spent $249 to fly him to their annual meeting in Las Vegas.

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

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