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 which will be superseded to a great extent by the details of AB 1890.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

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

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

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

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

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

The Blue Book laid out an aggressive. all residential consumers eligible on January 1. 18 Mydans. 2) providing cost recovery for energy efficiency programs that are at least as profitable as supply side measures. Hoffman. A more definitive policy statement was 16 17 Haddad.supplies. 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. In April of 1994. the CPUC issued a staff proposal regarding electric utility deregulation known as the “Blue Book”. customer class-staged schedule for direct access implementation. 55. and 3) rate changes to encourage efficiency and distribution of power. industrial customers taking power at the transmission level eligible on January 1. 1996. 2002. with large. 1999. sending “a shockwave through the electric industry”. all commercial customers eligible January 1. 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. and if successful. 6.18 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.17 A security analyst noted that the release of the Blue Book will: speed up the deregulation of the industry. 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 .

1995.22 FERC MegaNOPR In March of 1995.19 Since the release of the Blue Book proposal. 1994. and asserted that. 1994. pushing back their goal for a policy decision until September of 1995. Status Report. 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. 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. This led to the passage of Assembly Concurrent Resolution 143. including private and public-interest organizations. where customers voluntarily pay more to promote renewables.scheduled to be issued by the CPUC in August of 1994. coupled with a lack of prior coordination with the state Legislature. where CPUC President Fessler and Commissioner Knight testified on their proposal. 21 CPUC. ERG Master’s Project Mark Stout 13 . 1. “a vibrant market exists for energy efficiency services”. and documentation resulting in a report back to the Governor and Legislature by January 31.20 Many stakeholders. evidentiary hearings. In their place. Blue Book. Wagner. numerous other states have also proposed electric utility deregulation. which had been dubbed the MegaNOPR. 1995. the CPUC proposed. such as “green pricing”. Blue Book. For instance.21 This stakeholder response. were concerned about the content and timetable of this proposal. “alternative frameworks based on ‘let the market decide’”. The first issue addressed open access to the transmission system 19 20 CPUC. FERC released a dual-issue Notice of Proposed Rulemaking. which requires the CPUC to engage in a series of public hearings. This process tempered the CPUC’s frenetic timetable.

24 CPUC PoolCo Proposal ERG Master’s Project Mark Stout 14 . some thought the MegaNOPR ruling may set a precedent for 100% stranded cost recovery at the retail level. All power purchases would be made through the pool. Generators are scheduled into the pool based on time-based bids submitted to the ISO. meaning the utilities could not discriminate against other electricity suppliers. scheduled and dispatched by an independent system operator (ISO). The majority proposal known as PoolCo. Retail contracts with a particular generator could be handled with separate “contracts for differences”.24 22 23 CPUC. Stranded costs are past investments rendered uneconomic (market value less than book value) by the competition brought about through deregulation. favored by CPUC President Fessler and two other Commissioners. Asmus and Smeloff. 1997. Although stranded costs due to wholesale competition would be much smaller then those posed by retail competition. which is usually considered state jurisdiction. Status Report. The MegaNOPR also granted utilities the ability to collect 100% of their stranded costs due to wholesale transactions. in May of 1995. is based on a common wholesale power pool. 1995.23 CPUC May 1995 Draft Proposals and Stakeholder Responses As a result of the Blue Book CPUC staff proposal. A common price for all electricity in the state would then be set by the market clearing price based on the bids. the California Commissioners released two draft proposals for pursuing rate deregulation in California. forcing utilities to allow non-utility generators to use their transmission systems on a “comparable basis” at standard tariffs.for wholesale transactions.

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

a new mechanism is to be developed.1995 levels. a non-bypassable systems benefits charge is proposed. but spells out a set of public interest concerns that should be addressed by any industry restructuring including mitigation of market power. A minimum level of renewables is proposed for each IOU supply portfolio to return the states resource diversity to 1993 levels. and Towards Utility Rate Normalization (TURN) submitted a “Framework for Restructuring in the Public Interest” to the CPUC. the Framework demands that each individual utility customer. a coalition of public interest groups and renewable energy advocates. but with increased funding levels to restore energy efficiency and R&D spending at pre-Blue Book levels. 1995. UCS. with utility shareholders accepting some of the burden for past. uneconomic investments. To enhance energy efficiency efforts. including NRDC. EDF. does not actually propose a specific electric utility industry structure. should see short and long term rate reductions. including residential and small commercial consumers. as a response to the MOU. continuation of low income programs. The Framework calls for less than 100% stranded cost recovery. Framework Parties. ERG Master’s Project Mark Stout 16 . and continued progress for energy efficiency and renewable resources. small customer equity. Utilities Consumer Action Network. and at the level of attention given to the MOU. The Framework. By combining this with effective Performance Based Ratemaking.27 Outraged that they had been left out of the MOU negotiating process. 26 27 MOU Parties. (PBR). to decouple utility profits from sales volume. As in the MOU. The Framework calls for equitable opportunities for small consumer participation in any move to allow direct access. 1995.26 The CPUC held a full-panel hearing to focus on the details of the MOU in September of 1995. in the spirit of the existing Electric Revenue Adjustment Mechanism (ERAM).

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

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

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

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

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

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

447-475. 1993.51 Academics & Ideologues Neo-classical economists have argued since the 1970’s for the deregulation of the electric utility industry. 195. Hoffman 55-62. This reduction in scale has brought down the capital requirements of entering the electricity generation industry. who in the past had enjoyed privileged status with cheap rates. Gordon.intense pressure from large industrial customers. but now had to pay higher rates. 150. 1994. 50 Flavin and Lenssen. greatly increasing opportunities for bulk power sales. 84-108.. “Discretionary Evolution. Davis. ERG Master’s Project Mark Stout 23 . 1993.”.. 51 Stevenson. 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. 356-357.50 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. ”49 Technology The development of gas turbine generation technology has greatly reduced the scale requirements for efficient electricity generation. Advancements in transmission line technology now allow the efficient transmission of electricity for distances of hundreds of miles. enabling increased competition. 52 Gilbert.

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

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

355-356. the same year that California’s Blue Book proposal was released.”60 State Regulatory Policy Bidding programs for wholesale electric generation have been established in California. “Discretionary Evolution. Massachusetts. Colorado.”. an analyst with CPUC’s Division of Strategic Planning.”62 a form of integrated resource planning know as the BRPU. “Retail wheeling. 1997. Maine.. 24. though it urges states to consider retail competition. 1995.”. and Wisconsin. a proceeding in which the Commission attempts to determine how much capacity will be needed and structures the acquisition process in great detail. Commissioner Knight..has noted. 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. They “became increasingly perplexed about the arcaneness and gridlock that seemed to pervade the utility resource planning process. One of the stated proposals of the Blue Book is to eliminate the Biennial Resource Planning Update (BRPU). were the key retail wheeling champions within the CPUC. both appointees of Governor Pete Wilson.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. ERG Master’s Project Mark Stout 26 . 60 61 Levison. “DOE Restructuring Bill” Stevenson. New York. Calls for bids have often been oversubscribed by a wide margin. Michigan initiated a five year retail wheeling experiment involving two utilities.. 62 Asmus. according to Jeff Dassovich. In 1994.61 California Public Utility Commissioners Jesse Knight and Norm Shumway. Connecticut.. “the DOE bill does not mandate retail markets by any date certain.

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

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

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

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

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

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

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

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

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 . They want the idea of leastcost planning through IRP to be protected. Environmentalists would like to see an end to the backsliding that has occurred in utility energy efficiency and R&D budgets. and public interest RD&D. Most groups resist retail competition and support continued funding for new renewables. There is a significant rift that has developed over whether existing renewables generators should continue to receive subsidies. although a lack of specific funding levels was troubling. DSM. as well as in their opposition to the tying of stranded cost recovery to continued operation of nuclear plants. 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. These groups want to accelerate the removal of coal and nuclear plants from operation.• Environmental Organizations: Environmental organizations want the electric utility industry to evolve into a form which is environmentally and socially sustainable. • AB 1890 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. as well as in their opposition to the tying of stranded cost recovery to continued operation of nuclear plants. The inclusion of the Renewables Portfolio Standard was heralded as strong renewables policy by some environmentalists. The application of a public goods charge to pay for energy efficiency and public interest RD&D was good in principle. while others perceived it as continued charity for poorly-run businesses that had already received more than adequate support.

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

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

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. The utility labor unions and municipal utilities representatives reported receiving relatively little from this policy outcome. as well as the majority of large electricity consumers. say that their organizations got most of what they wanted from AB 1890. ERG Master’s Project Mark Stout 38 . As Figures 3 indicates. 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. and the remaining minority claim that their organization got rather little. The stakeholder representatives were also asked how much of what their organization wanted was included in AB 1890. a similar number of representatives report a mixed or unclear outcome.from the December Decision. Figure 4 shows that all of the investor-owned utilities and utility labor union Mixed/Unclear Most representatives.

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

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

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

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

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

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

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

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

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

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

agricultural consumers. roughly $660 million a year for the IOUs alone] of utility revenues for public purpose programs in the MOU came out of these discussions.” However. During the Conference Committee hearings. and energy efficiency.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. TURN was one of several public interest organizations who opposed the change. less than two weeks before the Bill would be reported out of committee. 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 . the public interest groups did not have much leverage to oppose the dissolution of this consensus since they did not have an engaged constituency of activists to back them up... A legislative outcome related to “green” pricing for renewables provides another example of an ephemeral consensus.. and the Sierra Club.. “We reached a consensus on.3% of utility revenues. funding for public purpose programs: low income.72 At this point late in the game. RD&D. reduced funding to an average of 2. CLECA. The 3% [it was actually a cap of 3. 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. These got translated into dollars.1% of IOU revenues. The August 15 language from a coalition of powerful interests. renewables with an incremental cost estimate from the BRPU. Industrial Users. EDF. As a Sierra Club California legislative chair recounts on meetings between CMA. hot days of August in the 1996 Conference Committee reveals that this “consensus” funding level took a large hit on August 15. a perusal of legislative language that was proposed during the long. including IEP.

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

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

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

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

203.608 $3.180 $0 $209.500 $1.031.592 $846 $0 ERG Master's Project Mark Stout 54 .675 $384.981 $1.079 $950 $14.675 $736.S.479 $2.166 $5.102 $0 $73.370 $648 N/A $0 $208.163 $0 $25.157 $0 $188.745 $68.153 $750 N/A $8.000 $1.000 $480.630 $300 N/A $0 $5.741 $21.092 $3.000 N/A $0 $18.995 $596.075 $4.559 $0 $246.096 $971.758 $2.112 $3.000 $562. 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.405 $0 $722.000 $62.272 $0 $64.239 $0 N/A $0 $89.470 $10.000 $634.101 $495 $10.500 $533.308 $516.416 $5.752 $0 $51. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.110 $34.952 $1.000 $0 $70. (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 $59.496 $8.500 $263.374 $1.588 $500 $32.419 $13.125 $0 $4.835 $1.1995 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear plants) Joint Electrical Industry Fund Pacific Gas & Electric/U.819 $0 $323.595 $0 $21.818 $0 $65.500 $190.964 $0 $40.000 $225.500 $78.000 $681.516.149 $3.181 $0 $160.079 $13.

081 $1.099 $12.271 $0 $12.400 $100 $79.197 $500 N/A $2.701 $0 $5.250 $0 $30.203 $0 $30.000 $20. (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.495 $1.326 $0 $100.167 $500 $25.362.207 $5.000 $383.145 $5.1995 Lobbying Totals RMC Lonestar (CLECA member) Southwest Portland Cement Co.003. 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 $4.665 $0 $262.000 $37.947 $500 $281.000 $0 $6.000 $0 $15. (gasoline refining and marketing) Tower Energy Group (oil.203 $5.492 $0 $66.401 $1.291 $3.319 $0 $10.495 $27. (bulk terminals) Mobil Texaco Tidelands Oil Tosco Corp.551 $12.716 $39.600 $32.519 $11.850 $1.000 $0 $171.230.600 N/A $5.596.000 $524.675 $0 $1.083 $0 $20.938 $0 $118.055 $0 $151.500 $0 $0 ERG Master's Project Mark Stout 55 .723 $0 $38. natural gas.000 $526.

543 $29.017 $1.000 $209. (biomass) Destec (gas-fired) Edson + Modisette (lobbyist for indep.159 $3.000 $50.882 $15.281 $1.200 $837.000 $33. McQuat.286 $3.400 $1.147 $500 $739.460 $50.819 $921.250 $148.1996 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Electric Power Research Institute General Electric (nuclear plants) Pacific Gas & Electric/U.179 $0 $3.500 N/A $0 $211.750 $267.571 $500 N/A $200 N/A $1.100 $144. (gas-fired) American Wind Energy Association Bechtel (gas-fired) Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co.229 $100 N/A $1.000 NA $500 $0 $2.626 $0 $8.782 $981. and Hamrin.500 N/A ERG Master's Project Mark Stout 56 .) 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.S.025.750 $1.000 $35.331 $0 $97.845 $452.905 $30.750 $418. EVs) Enron Corporation (gas fired) GWF Power Systems (oil and coal-fired) Hansen. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades United Assoc. (geothermal) California Cogeneration Council California Solar Energy Industry Association Cannon Energy (windpower) Colmac Energy Inc.100 $0 $500 N/A $100 $0 $500 N/A $2.917 $300 $5.611 $1.032 $0 $172.605 $250 N/A $1.454 $3. (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) $145.195 $401.590 $5.250 N/A $100 N/A $2.862 $21. of Jrnymn & Aprt Underground Utility/Landscape Utility Workers Union of America INDEPENDENT PRODUCERS AES Pacific/SF Energy Co.240 $0 $178.000 $85. 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.118 $0 $144.600 $276. 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.748 $32.500 $29.589 $26.724 $500 not applicable $500 $57. producers.000 N/A $100 N/A $7.717 $500 not applicable $0 $138.450 $566.060 $6. Dist.

Texaco Tidelands Oil Tosco Corp.137 $550 N/A $5.138 $1.016 $1. 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) $41.689 $2.500 $47. (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.072 $918.750 $23.245 $335.861 $1.705 $19.960 $2.643 $1.407 $200 $61.417 $9.878 $12.500 $277.573 $2. natural gas.250 $34.521 $14.712 $100 N/A $200 $16.1996 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.995 N/A $100 N/A $0 $3. (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.209.800 not tracked $3. (gasoline refining and marketing) Tower Energy Group (oil.721 $748.989 N/A $9.925 $0 $44.521 $1.438 $500 N/A $0 $1.532 $4.761 $0 $73.511 $1.050 N/A $0 $214.780 ERG Master's Project Mark Stout 57 .296 $800 $25.495 $22.900 $0 $21.750 $37.000 $76. diesel) Unocal (CMA member) Victory Oil Co.900 $1.000 $500 $456.478.177 $300 N/A $0 $29.650 $3.090 $749 $38.521 $0 N/A $50 $87.661.050 $949.347 $9.000 $233.500 $251.384 $2.636 $0 $103.958 $2.181 $1.622 $67.950 $3.000 $65.885 $300 $207.334 $498 $1.000 $22.754 $4.

California Institute for Energy Efficiency California Integrated Waste Management Board (biomass) Note: N/A = not available Conference Committee Total California Campaign Lobbying Expenses Contributions (Jan-Sept) $1.462 $208.000 $900 N/A $400 N/A $500 N/A ERG Master's Project Mark Stout 58 .250 $21.000 $15.1996 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.448 $424.462 $500 $14.585 $33.000 $2.066 $500 $21.378 $100 $21. of California.790 $100 $14.068 $14.438 $4.000 $700 $117.066 $500 N/A $250 N/A $22.

4 ERG Master’s Project Mark Stout 59 .As one would imagine. and small consumer groups. including oil and natural gas companies. regulators. Shanghai. were able to far outspend environmental organizations (who were usually spread thin over many issues). paying up to $7. From 3/28/96 to 4/8/96. a clean power auction the CPUC repeatedly postponed upon the urging of the utility. to meet with CEOs of the electricity industry. the lobbying summary tables above. According to investigative writer Peter Asmus. One example of the type of access to officeholders that money can buy is the junkets run by the California Foundation on the Environment and the Economy. 1996. 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. government ministers. for $7. and environmental groups to discuss the British experience with deregulation of electricity. and Privatization” took AB 1890 author Jim Brulte and Conference Committee 79 80 Asmus. and Paris. and Inner Mongolia. CFEE is a “non-profit.”80 In April of 1995. 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. their “Travel project to Europe on Electric Restructuring. 1996.167 per guest. alternative energy producers. 4 Asmus. “though the CPUC had imposed a ban on communications regarding the Biennial Resource Plan Update (BRPU). an Edison lobbyist was added to the international travel party at the last minute. Brussels.800 each. as well as the legislator breakdown tables and gift descriptions in Appendix E show that IOUs and large consumers. Conservation.

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

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

Bibliography
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AB 1890)? Why? Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. 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.e.. CPUC vs. 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. and why? Which stakeholder groups do you think could have been more effective in influencing the policy formulation process. 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-1. eventually giving in to it while creating tensions with some parties. Now that PG&E has realized electric utility deregulation is inevitable. PG&E initially said no to gas deregulation. PG&E’s experience with the restructuring of the gas industry provided valuable insight that shaped this approach. PG&E does not want to have to automatically take the blame when reliability issues arise.”81 What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? According to Kathy. PG&E provides gas and electric service to more than 13 million people in northern and central California. “Pacific Gas & Electric is a California Investor Owned Utility Company. PG&E wants to avoid the stranding of deals that were made in an era of an intact regulatory compact. 81 CPUC Renewables Working Group. and 2) coverage for utility stranded costs and obligations. they want to be able to shape the outcome more effectively according to Kathy.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. Secondly. ERG Master’s Project Mark Stout 67 . For one. PG&E had two main goals from the California deregulation process: 1) an orderly transition to a restructured generation environment.

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

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

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

SDG&E was a supporter of the PoolCo market structure along with Edison. and got it struck down. When Tom Page came in as CEO in 1981. everyone should pay. with the exception of the legislation’s mechanism for a rate reduction. 1995 Decision? The PUC was on the right track. SDG&E wanted to become the lowest priced California IOU. It does not make sense for SDG&E alone to go out and acquire more expensive renewable resources. so we would have to buy energy or credits. We went to FERC. 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. if you are a broker. The lucky Arizona utilities went with coal. 1996. 84 CPUC Renewables Working Group. This would put us at a competitive disadvantage compared to PG&E and Edison. AB 1890 mirrors the Decision in many ways. 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. Also. ERG Master’s Project Mark Stout 71 . Throughout the ‘70s. they did not get there by investing in high cost renewables. We were very opposed to the BRPU. High priced renewables are OK if you are not moving to a competitive future. we had the highest rates in the nation. [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. but are not viable with competition.84] SDG&E does not have any renewables. We were strongly opposed to the RPS. except for electricity purchases from Mexican geothermal generators.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

we commented on the Yellow Book. We were there for the great bulk of the hearings. ERG Master’s Project Mark Stout 101 . CIU took part in most full panel hearings. Our members are business entities with a nationwide presence. Rather than have counsel speak. it felt like “we’ve been here before”. due to the length of the policy phase proceedings. The raw material of the initial bill came from coalition participants. and made our contribution. Early on.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. but our concerns at the time were still rate-case focused. At some points. We have also met with the Commissioners. 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. We have occasionally lobbied on more specific issues. Some of these meetings were spontaneous. This applies to the formal Committee. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? Our participation was largely a matter of being present and accounted for. We thought that we were busy during the policy phases of restructuring. for instance on the rate restructuring settlement. bringing member company representatives in from time to time to discuss broader agendas. and filed comments at every opportunity. as well as the caucusing and preparatory sessions amongst parties. able to draw on experts knowledgeable on energy policy and acquisition. we had member company representatives participate in several full panel hearings. particularly in the collateral coalition meetings. some were at the request or demand of the Committee. It is important for the Commissioners to hear from the people actually running the businesses whose electricity needs have been our focus.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

the CPUC deregulation process was thrown open to a much wider spectrum of public input than initially envisioned by the public utility commissioners. One interesting outcome of the meeting with President Fessler was that he started to lobby Jane and Nancy to support his position. 143 adopted. resulting in over 2. 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. 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. UCS’s insider approach was composed of elements such as filed comments and full panel hearing testimony by UCS senior energy analyst Donald Aitken. To compliment this public participation strategy. asking them to respond to the CPUC through a Western Union automated fax number. as well as staff people for Commissioners Knight and Conlon.000 environmentalists in California. UCS volunteers and staff were active at over a number of 1996 Earth Day events throughout ERG Master’s Project Mark Stout 136 . Jane thought this amounted to a level of public pressure that was outside of the usual institutional experience at the CPUC. UCS took part in a mailing to 60. By helping to get Assembly Concurrent Resolution No. as well as generating a large number of letters to the CPUC. 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.

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

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

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

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

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

In the February 14. very committed.e. Whether or not the Legislature intended this was a point of contention. More money could have been spent on public interest RD&D. most public interest RD&D money was allocated to the CEC: $61. Also. Steve Peace and Byron Sher recently sent a letter to the PUC. and this comes through in our briefings. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. 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. Is your organization more comfortable with one policy decision over the other (i. Neeper did after the December. AB 1890)? Why? I would see them as an appropriate sequence of decisions. ‘97 Decision on public purpose programs. compared to just 0. but it was a reasonable outcome. working well together. realizing the dollars available for public purpose programs were limited. Duque was very ERG Master’s Project Mark Stout 142 . There is an agreement that the PUC could continue funding after 4 years.8 million per year. stating that their intent was that the PUC retain authority for energy efficiency funding. or over time? I think so. not end this authority after four years. we did not change our stance. the Legislature or PUC could modify.. briefings to the IOUs were a standard part of the communication. Conlon attended a briefing a few years back. We have good people involved in research. Fessler attended one earlier.How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? The University supported AB 1890.7 per year to the utilities. ‘95 decision. CPUC vs. The funding for public interest RD&D will be reviewed after three years.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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 #2 Sierra Club Union of Concerned Scientists STATE INSTITUTIONS California Energy Commission University of California.Interview #2 INDEPENDENT PRODUCERS American Wind Energy Association Independent Energy Producers LARGE ELECTRICITY CONSUMERS Agricultural Energy Consumers Association California Industrial Users California Large Energy Consumers Association .Interview #1 Coalition of California Utility Employees .Interview #1 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 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 #1 California Municipal Utilities Association .

Interview #1 Coalition of California Utility Employees .Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees .Interview #1 California Large Energy Consumers 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 .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 . 0 0 1 0 1 1 3 9 10 ERG Master’s Project Mark Stout 160 . 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 .Interview #1 Natural Resources Defense Council .Interview #1 California Municipal Utilities Association .Interview #2 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council .Interview #2 Sierra Club Union of Concerned Scientists STATE INSTITUTIONS California Energy Commission University of California.

Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees .Interview #2 Sierra Club Union of Concerned Scientists STATE INSTITUTIONS CPUC DD AB 1890 No preference/Unclear 0 3 0 1 1 1 0 1 1 1 1 1 1 1 1 0 1 1 4 1 1 1 1 0 1 1 3 1 1 1 1 0 0 2 1 1 3 14 4 1 1 0 0 0 0 0 2 1 California Energy Commission University of California.Interview #1 Coalition of California Utility Employees .Which Policy Outcome Does Your Organization Prefer? INVESTOR-OWNED ELECTRIC UTILITIES Pacific Gas & Electric San Diego Gas and Electric Southern California Edison MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association .Interview #1 California Large Energy Consumers Association .Interview #1 California Municipal Utilities Association .Interview #2 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council .Interview #1 Natural Resources Defense Council .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 .

000 $7.495 $7.429 $498 $1.) California Independent Oil Marketers Association Chevron (CMA member) Mobil Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $22. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.000 $4. (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.500 $1.000 $1.000 $1.000 $3.896 $3.495 $10.995 $300 $12.495 $1.000 $500 $1.995 $21.000 $0 $0 ERG Master’s Project Mark Stout 162 .000 $495 $950 $696 $2.191 $2.000 $2.000 $3.000 $1.800 $1.500 $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.000 $3.Appendix E: Restructuring Stakeholder Campaign Contribution/Gift Analysis Detail Table 1: Assemblymember Jim Brulte.000 $2.

000 $8.000 $2.017 $749 $750 $3.000 $1.990 $1. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co. 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.500 $1.) California Independent Oil Marketers Association California Independent Petroleum PAC Chevron (CMA member) Exxon Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $28.500 $6. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades INDEPENDENT PRODUCERS CalEnergy Co.511 $3.995 $1.995 $0 $0 ERG Master’s Project Mark Stout 163 .460 $200 $500 $750 $2.500 $1.Table 2: Assemblymember Jim Brulte.500 $800 $498 $200 $9.750 $4.000 $2.000 $10.495 $4.000 $1.995 $2.250 $2. (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.500 $47.000 $3.995 $14.000 $1.

000 $2.750 $3. Paling in comparison. CFEE is a “non-profit. (geothermal) Indpependent Energy Producers OIL AND NATURAL GAS COMPANIES California Independent Petroleum PAC Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $11.500 $1.000 $1. Conservation. From 3/28/96 to 4/8/96.490 “Travel project to Europe on Electric Restructuring. AB 1890 author Assemblyman Jim Brulte accepted no gifts from stakeholders. Chevron treated Brulte to two meals.000 $1. 4 ERG Master’s Project Mark Stout 164 . Table 3: Senator Steve Peace.1995/1996 Stakeholder Gift Information for Assemblymember Jim Brulte In 1995. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co. Mobil treated Brulte to a $60 event in 1996.250 $500 $1. as well as an event.000 $2.000 $750 $0 $0 103 Asmus. 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. totaling $101.750 $2. and Privatization” visiting London. Brulte was taken on a $7.000 $3. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure103. and Budapest. Sweden. Not to be outdone. 1996. by the California Foundation on the Environment and the Economy.750 $750 $1.000 $1.

072 $2.Table 4: Senator Steve Peace.000 $4. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.115 $18.500 $8.572 $1.500 $3.050 $3.450 $7.000 $6.815 $750 $6.100 $2.250 $1.750 $0 $0 ERG Master’s Project Mark Stout 165 .250 $7.000 $300 $1.000 $750 $750 $750 $1.000 $1.600 $2.500 $16.) California Independent Petroleum PAC Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $48.250 $2. 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 $750 $500 $1.000 $500 $2.

Southern California Edison was granted a high level of access.000 $5. 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. while Edison treated him to five meals and a sports event.100 $2. IEP made a gift of $241 for his speech at a conference. In 1995. taking Steve to 11 meals. Peace was treated to a $52 sports event by Mobil Oil.000 Table 6: Senator Byron Sher. as well as chair of the Senate Energy and Utilities Committee.900 . Peace began a practice of reimbursing all utilities for meals and outings starting with Edison in 1995. 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. SDG&E had Peace out to six meals. SDG&E pulled on Peace’s ear over a sports event and meal totaling $89.450 166 ELECTRIC/GAS $6. Table 5: Senator Byron Sher.1995/1996 Stakeholder Gift Information for Senator Steve Peace Given Steve Peace’s prominence as chair of the Conference Committee on Electric Utility Restructuring. he maintained a pretty low profile in 1995 and 1996 in terms of accepting gifts and trips. In 1996.

Brotherhood of Electrical Workers (various $9.482 $100 $1.000 $100 producers. (gas-fired) American Wind Energy Association Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co.600 $13. EVs) Hansen. (geothermal) Colmac Energy Inc.882 $100 $1. $2.500 Int.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. McQuat. and Hamrin. Inc (consultants) $200 ERG Master’s Project Mark Stout 167 . of Journeymen & Apprentice Underground Utility/Landscape INDEPENDENT PRODUCERS AES Pacific/SF Energy Co.000 $500 $1. (biomass) Edson + Modisette (lobbyist for indep.000 locals) Southern California Pipe Trades United Assoc.000 $500 $500 $9.

000 $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 (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 Large Energy Consumers $3.250 $100 $50 $500 $500 $250 ERG Master’s Project Mark Stout 168 .000 $1.500 COMPANIES $1.000 (tire $1.000 $100 $100 $500 $1.000 $100 $1.

585 $100 $500 $2. of California. (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. California Institute for Energy Efficiency California Integrated Waste Management Board (biomass proponents) Nevada Community Action $1.462 $100 $900 $400 $500 ERG Master’s Project Mark Stout 169 .000 $700 $4.Tosco Corp.000 $300 $300 $22.448 $14.

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. Exxon. Table 7: Senator Bill Leonard. totaling $758. and GE.1995/1996 Stakeholder Gift Information for Senator Byron Sher In 1995.000 $1.400 $750 $150 $1. Sher received no other gifts that year from energy utility stakeholders. Mobil. 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. Sher holds over $100.500 $0 $0 ERG Master’s Project Mark Stout 170 .500 $300 $0 $0 $2. NARUC treated Sher to a two day trip to DC for another meeting. In 1996.300 $500 $1. but his Statement of Economic Interest reveals large holding of oil and electricity stocks.000 in each of Amoco. totaling $2608.

and a $75 dinner at the American Legislative Exchange Council’s annual meeting.000 $2. SCE treated Leonard to dinner and lodging for Legislative Ski Day. SDG&E bought Leonard a $125 ticket to the Pete Wilson Inaugural Gala.500 $150 $500 $3.500 $500 $1. While the Senator was there.000 $0 $0 1995/1996 Stakeholder Gift Information for Senator Bill Leonard In 1995. Senator Leonard was courted a little more heavily by energy stakeholders in 1996.650 $500 $1. 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. Edison’s lobbyists got to spend a little more quality time with Leonard for their money.080 $10. The Pacific Rim Conference of Seattle.) Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $19. SCE treated him to a $30 beach party and a $20 lunch with lobbyist Bob Foster.730 $2.Table 8: Senator Bill Leonard.650 $2.000 $500 $500 $4. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS California Mining Association PAC California Portland Cement Co. Edison again ERG Master’s Project Mark Stout 171 .000 $1.000 $5. for a paltry $20.000 $1. saving up for a $77 dinner with head lobbyist Bob Foster. (CLECA member) California Steel Industries (CLECA member) Mitsubishi Cement (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $2. WA paid $734 for Leonard to moderate a conference session on utility deregulation. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co. extending his stay from 12/8/96 to 12/13/96.000 $2.

250 $1. including lunch with Bob Foster. PG&E took Leonard out to a Kings game. paying $44 for two meals and lodging. ARCO treated Leonard to a $19 meal at a reception.had Senator Leonard out for Legislative Ski Day.600 $1.000 $750 $750 $650 $150 $500 $3. 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.) Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $6.000 $1. for the modest tab of $56.750 $1. Table 9: Assemblymember Mickey Conroy.000 $1.250 $750 $0 $0 ERG Master’s Project Mark Stout 172 . They also had Leonard out for two meals in Sacramento.600 $750 $750 $500 $1.000 $1.

1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS California State Pipe Trades Council PAC Int. and to 104 Asmus. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure104. CFEE is a “non-profit.000 $5.700 $500 $300 $550 $2.000 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Mickey Conroy In April of 1995.000 $3.600 $3. the California Foundation on the Environment and the Economy took Conroy on an 11 day.300 junket to talk with Chinese central government and provincial leaders in Beijing. (CLECA member) California Steel Industries (CLECA member) Louisiana Pacific (CMA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.Table 10: Assemblymember Mickey Conroy.000 $2.000 $500 $750 $250 $500 $2. 1996. Shanghai.) California Independent Petroleum PAC Chevron (CMA member) Southern Counties Oil Co.050 $1. 4 ERG Master’s Project Mark Stout 173 .000 $500 $2.700 $750 $450 $250 $250 $1. two meals for $44.600 $500 $1. and Inner Mongolia. 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. Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $9.500 $2. PG&E treated him to a basketball game with $51 tickets. $7.

four rounds of “refreshments” for $30. ERG Master’s Project Mark Stout 174 . the Assemblymember seems to have a penchant for electric utilities and nuclear power plant manufacturers. In terms of investment.000 each in Edison. costing $99. and Westinghouse Electrical. and less than 10. Edison wined and dined the Assemblymember with four meals at $134. General Electric.make sure Conroy kept a sweet spot in his heart for them. Chevron took Conroy out for two business meals. After such a busy social calendar in 1995.000 in Orange & Rockland Utilities. it is surprising that no electric utility deregulation stakeholders made any gifts to Assemblymember Conroy in 1996. SDG&E. $10 in candy. with investments of greater than $10. Kansas City Power & Light. and $25 of cookies and candy. Pacificorp.

750 $4.750 $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.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.750 $1.750 $750 $500 $500 $750 $0 $0 ERG Master’s Project Mark Stout 175 .Table 11: Assemblymember Diane Martinez.675 $2.750 $1. (geothermal) Indpependent Energy Producers OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.000 $1.250 $1.250 $1.175 $500 $1.000 $1.

500 $6.000 $500 $500 $5.500 $1.) UTILITY LABOR UNIONS California State Association of Electrical Workers Int.500 $1. (CLECA member) California Steel Industries (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $20.000 $0 $0 ERG Master’s Project Mark Stout 176 . Dist.750 $1.Table 12: Assemblymember Diane Martinez.000 $7. 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.250 $1.500 $1. (member of IPPs of NY) Zond Windpower LARGE ELECTRICITY CONSUMERS California Manufacturers Association California Portland Cement Co.000 $500 $500 $500 $500 $500 $3.000 $500 $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.000 $1.500 $1. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.000 $4.500 $500 $500 $1.000 $1.000 $5.000 $1.000 $500 $3.000 $4.

850 $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. natural gas.467 trip to Northwestern University to discuss the deregulation of public utilities.900 $3. ERG Master’s Project Mark Stout 177 .100 $100 $1. (bulk terminals) Mobil Tidelands Oil Tower Energy Group (oil.500 $1. The Assemblymember enjoyed no such gifts from deregulation stakeholders in 1996.058 $500 $500 $1.000 $8. diesel) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.208 $0 $0 $1.600 $1. the Illinois Energy Association flew Martinez out for a $1.000 $500 $500 $1.) California Independent Oil Producers Chevron (CMA member) Kaiser International Corp.000 $1.Table 13: Assemblymember Steve Kuykendall.600 $500 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Diane Martinez In 1995.500 $1.

) California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Mobil Texaco Tidelands Oil Tower Energy Group (oil.000 $1. ERG Master’s Project Mark Stout 178 .500 $0 $1.250 $100 $500 $35.989 $500 $500 $0 $0 1995/1996 Kuykendall Stakeholder Gift Information for Assemblymember Steve In 1995.000 $2.000 $1.374 $500 $2. Kuykendall was taken on a $7.Table 14: Assemblymember Steve Kuykendall.443 $6. diesel) Unocal (CMA member) Victory Oil Co.254 $200 $500 $4.350 $500 $1.000 $1.500 $1.000 $500 $2.374 $4. SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $10.490 “Travel project to Europe on Electric Restructuring. natural gas. Western States Petroleum Association treated Kuykendall to a reception and a dinner totaling $62. Conservation. From 3/28/96 to 4/8/96. Kuykendall’s social calendar was destined to pick up in 1996. However.500 $1. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS 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. Sweden. and Privatization” visiting London. and Budapest.000 $19.

Another non-profit organization. 1996. spent $516 to fly Fessler to a “Series on Energy Efficiency in the 21st Century”. government ministers. was very interested in California moving to the UK-style. The California Mining Association took him out for an evening of recreation and dinner costing $89. a trade association for publicly owned utilities. wholesale PoolCo model. The Energy Foundation flew him to Colorado twice for “Future of Utilities” and “Utility Futures IV” meetings. 4 ERG Master’s Project Mark Stout 179 . for $610. “though the CPUC had imposed a ban on communications regarding the Biennial Resource Plan Update (BRPU). SC to address their membership. paid $1.051 to fly the President out to New York City for a ConEdison Management Conference. The Aspen Institute. regulators. Brussels. spent $1402 to fly Fessler to Charleston. Fessler was taken on a $7. to meet with CEOs of the electricity industry. an Edison lobbyist was added to the international travel party at the last minute. A trade association. and Paris. by the California Foundation on the Environment and the Economy. a clean power auction the CPUC repeatedly postponed upon the urging of the utility.”105 The Consolidated Edison IOU spent $1. According to investigative writer Peter Asmus. 1994/1995 Stakeholder Gift Information for CPUC President Daniel Fessler From 3/16/94 to 3/27/94.916 for the Assemblymember to speak and moderate a panel discussion on electric utility deregulation. The California 105 Asmus. known as the Council of States Government . one of CFEE’s funders. and environmental groups to discuss the British experience with deregulation of electricity. CO. in Aspen.by the California Foundation on the Environment and the Economy. The Large Public Power Council. Edison.167 junket visiting London.WEST. Chevron treated Kuykendall to two dinners for $131.

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

and Schlumberger oilfield services stock.000 in each of Chevron. utility and General Electric stock. and Paris. He left office on February 23. to meet with CEOs of the electricity industry.000 in each of Central & Southwest Corp. In 1995. Jr. 1994/1995 Stakeholder Gift Information for Commissioner Henry Duque Duque did not report any electricity deregulation stakeholder gifts in 1994 or 1995.1994/1995 Stakeholder Gift Information for Commissioner Gregory Conlon From 3/16/94 to 3/31/94. 1995. government ministers. by the California Foundation on the Environment and the Economy. The Edison Electric Institute spent $279 to fly the Commissioner to a conference on the results of State Competition in Boca Raton. Knight did not report any electricity deregulation stakeholder gifts in 1994 or 1995. wholesale PoolCo model. Edison. 1994/1995 Stakeholder Gift Information for Commissioner Norm Shumway In February of 1994. and less than $10. was very interested in California moving to the UK-style. PG&E had him out to three meals for $71. regulators. He does own less than $10. He does own more than $10.167 junket visiting London.000 in each of Montana Power Company and Exxon stock. and environmental groups to discuss the British experience with deregulation of electricity. 1994/1995 Stakeholder Gift Information for Commissioner Jesse Knight. Brussels. the Northwest Electric Light and Power Association flew Shumway to their 3rd annual Non-Utility Generation Conference. spending $258. ERG Master’s Project Mark Stout 181 . Unocal. 1994/1995 Stakeholder Gift Information for Commissioner Josiah Neeper Knight did not report any electricity deregulation stakeholder gifts in 1994 or 1995. one of CFEE’s funders. Conlon was taken on a $7.

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