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 which will be superseded to a great extent by the details of AB 1890.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

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

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

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

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

EPAct also aimed to level the playing field for supply-side and demand-side (energy efficiency) resource options.. 14 Also. which compares supply. “Social Goals. They likewise lose money when the encourage customers to engage in conservation. ERG Master’s Project Mark Stout 11 ..and demand-side options systematically when seeking least-cost energy 12 13 Stevenson.” 356-357. “Discretionary Evolution.” 521. “Energy Efficiency Solutions.. “Global Warming and Least-Cost. 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. These lead to what the National Association of Regulatory Commissioners calls the “payback gap”: substantially higher rate of return expectations for energy efficiency measures compared to supply-side investments. Stevenson.. 15 Cavanagh. This money-losing proposition is not significantly improved by any of the conservation cost recovery or incentive mechanisms now in use. “1) implementing Integrated Resource Planning (IRP).. regulated utilities were discouraged from pursuing demand-side resources because of a profit structure that was directly linked to the amount of energy sold. 356. One prominent utility regulator remarked on the situation that had developed in the 1980s: “In the current scheme of regulation.” 407.13 and the transient nature of short term building owners and renters.classes of IPPs including Exempt Wholesale Generators. utilities make money in only one way--selling [units of energy]. inadequate information available to customers.. allowing larger generation plants to be exempt from traditional regulation.”. Utilities lose money when customers engage in conservation. 14 Cavanagh...12 While encouraging wholesale competition.

sending “a shockwave through the electric industry”. A more definitive policy statement was 16 17 Haddad. 2) providing cost recovery for energy efficiency programs that are at least as profitable as supply side measures. 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.”16 CPUC “Blue Book” Proposal California’s Public Utility Commission is widely viewed as a trend-setter for state PUC electric utility regulation. and if successful. 6.17 A security analyst noted that the release of the Blue Book will: speed up the deregulation of the industry. 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.supplies. industrial customers taking power at the transmission level eligible on January 1. 18 Mydans. customer class-staged schedule for direct access implementation. the CPUC issued a staff proposal regarding electric utility deregulation known as the “Blue Book”. 55. In April of 1994. Hoffman. with large. ERG Master’s Project Mark Stout 12 . 2002. and 3) rate changes to encourage efficiency and distribution of power. 1996. all residential consumers eligible on January 1.18 The proposed deregulated electricity market would allow individual customers to choose their electricity generation supplier using bilateral contracts in a system known as retail wheeling or direct access. all commercial customers eligible January 1. The Blue Book laid out an aggressive. This utility restructuring involves the divestiture of utility electricity generation facilities into separate companies from the original utility which would still be responsible for transmission and perhaps distribution. 1999.

19 Since the release of the Blue Book proposal. 1994. “alternative frameworks based on ‘let the market decide’”. Wagner.scheduled to be issued by the CPUC in August of 1994. such as “green pricing”. ERG Master’s Project Mark Stout 13 . 1995. environmental organizations were frightened by the Commission’s decision to move away from the current IRP process and mechanism for decoupling utility profits from sales volumes. This process tempered the CPUC’s frenetic timetable. including private and public-interest organizations. prompted the Assembly Committee on Utilities and Commerce and the Assembly Committee on Natural Resources to hold a joint oversight hearing on May 23. Blue Book. FERC released a dual-issue Notice of Proposed Rulemaking. numerous other states have also proposed electric utility deregulation. 1995. 1. Blue Book. where customers voluntarily pay more to promote renewables. The first issue addressed open access to the transmission system 19 20 CPUC. were concerned about the content and timetable of this proposal. and documentation resulting in a report back to the Governor and Legislature by January 31. 21 CPUC. 1994. which had been dubbed the MegaNOPR.21 This stakeholder response. For instance. the CPUC proposed. This led to the passage of Assembly Concurrent Resolution 143. which requires the CPUC to engage in a series of public hearings. coupled with a lack of prior coordination with the state Legislature. where CPUC President Fessler and Commissioner Knight testified on their proposal. 1994. In their place. pushing back their goal for a policy decision until September of 1995.20 Many stakeholders. evidentiary hearings. Status Report.22 FERC MegaNOPR In March of 1995. and asserted that. “a vibrant market exists for energy efficiency services”.

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

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

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

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

arguing that it should not be used as a national model for protection of residential and small commercial consumer interests. 33 CPUC press release. small consumer group. the final product of this bipartisan conference committee handily passed on the Senate and Assembly floors with minimal debate. 1996 32 Weisman. December. 1996 31 Rader. 1997.34 There is concern that 29 30 CPUC. omnibus legislation which preempts much of the PUC vision31. 1995 Decision. 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. other market participants."33 However. While the pace of the PUC process was tempered so that their final policy decision could better reflect stakeholder interests. and confidential correspondence with stakeholder representative. TURN. Even given the large economic and environmental stakes. 1996 Roadmap CPUC press release. since it was perceived as a best effort compromise between the two main political parties. cutting deals with the stakeholders that would be required to “deliver the votes” within the committee. neither process involved substantial public education or participation. has criticized AB 1890. 1996 ERG Master’s Project Mark Stout 18 . and especially residential and small commercial California ratepayers. compared to the reckless pace of the legislative wrangling. 1996 34 TURN press release.committee on deregulation worked at breakneck speed. As the PUC stakeholder working group process drew to an end. 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. Several public interest organizations served as advocates for small consumer and environmental protection. a prominent.

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

1997. would be eligible for direct access January 1. the CPUC and California Energy Commission (CEC) have been working towards the implementation of this legislation. chair of the House Energy and Power Subcommittee. “Primed for Congressional Battle” ERG Master’s Project Mark Stout 20 . 1997. 1996 CEC. the CPUC released its latest restructuring decision which surprised stakeholders by announcing that all customers. and 15% consumer-side incentives. The overall levels are: 45 % existing technologies. 1997 41 Marshall. 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. including residential and small commercial consumers. 1997 42 Weisman.41 There are currently several electric utility restructuring bills in Congress. 10% emerging technologies. In March of 1997. 30% new technologies.environment/equity agenda” which had gripped the industry since the release of the Blue Book in 1994. As Carter and Cavanagh have noted. including a prominent one authored by Representative Dan Schaefer (R-CO).40 On May 6. the California PUC was on a clear course to abandon all [funding for public purpose programs] on grounds of lack of statutory authority. “If the bill had failed.”39 Recent State and Federal Activity Since the signing of AB 1890 into law. 1998.42 This bill includes a "minimum renewable energy generation 39 40 Carter and Cavanagh. It divides up this amount into four accounts that vary over four years of funding.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

either the CPUC December Decision or 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. It is 0 1 2 3 4 5 clear from the interview transcripts Figure 5: What Policy Outcome Does Your Organization Prefer? No preference / Unclear CPUC December Decision that those few organizations that stated a preference for the December Decision did so based on their support Portfolio selected for the Renewables that was Standard by the Commissioners as a renewables AB 1890 policy. Figure 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. As Figures 5 indicates. as opposed to the nonbypassable surcharge funding mechanism adopted in AB 1890 ERG Master’s Project Mark Stout 39 . most organizations preferred the INDEPENDENT PRODUCERS SMALL ELECTRICITY CONSUMERS LARGE ELECTRICITY CONSUMERS Rather Little Mixed/Unclear Most language of AB 1890.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

180 $0 $209.470 $10.370 $648 N/A $0 $208.592 $846 $0 ERG Master's Project Mark Stout 54 .125 $0 $4.995 $596.203.500 $78.595 $0 $21.157 $0 $188.608 $3.559 $0 $246.000 N/A $0 $18.419 $13.S.964 $0 $40.835 $1.952 $1.588 $500 $32.818 $0 $65.149 $3.308 $516.405 $0 $722.000 $681.745 $68.500 $1.752 $0 $51.416 $5.181 $0 $160.496 $8.741 $21.272 $0 $64.000 $1.092 $3. 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.981 $1.000 $562.000 $634. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.000 $225.000 $0 $70.819 $0 $323.516.000 $480.675 $384.075 $4.079 $13.675 $736.031.163 $0 $25.500 $533.166 $5.153 $750 N/A $8.096 $971.758 $2.479 $2.500 $190.110 $34.079 $950 $14. (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 $59.101 $495 $10.374 $1.239 $0 N/A $0 $89.1995 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear plants) Joint Electrical Industry Fund Pacific Gas & Electric/U.000 $62.102 $0 $73.500 $263.112 $3.630 $300 N/A $0 $5.

1995 Lobbying Totals RMC Lonestar (CLECA member) Southwest Portland Cement Co.081 $1.938 $0 $118.495 $27.401 $1. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO California Independent Oil Marketers Association California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Exxon Kaiser International Corp.099 $12.551 $12.203 $0 $30.850 $1.000 $0 $171. natural gas.230.723 $0 $38.675 $0 $1.716 $39. (bulk terminals) Mobil Texaco Tidelands Oil Tosco Corp.055 $0 $151.000 $526.701 $0 $5.947 $500 $281.400 $100 $79.000 $37.083 $0 $20.665 $0 $262.600 $32.519 $11.197 $500 N/A $2.003. (gasoline refining and marketing) Tower Energy Group (oil.492 $0 $66.596.167 $500 $25.000 $524.291 $3.271 $0 $12.145 $5.600 N/A $5.000 $0 $15.000 $20.000 $0 $6.362.203 $5.207 $5.319 $0 $10.250 $0 $30.495 $1.326 $0 $100. 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 $4.500 $0 $0 ERG Master's Project Mark Stout 55 .000 $383.

000 $33. 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.179 $0 $3.819 $921.250 $148.750 $418.571 $500 N/A $200 N/A $1.286 $3.000 $35.281 $1.590 $5.229 $100 N/A $1.454 $3.400 $1.000 N/A $100 N/A $7.611 $1.450 $566.460 $50.250 N/A $100 N/A $2. and Hamrin.200 $837.000 $50. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades United Assoc.159 $3. (biomass) Destec (gas-fired) Edson + Modisette (lobbyist for indep.118 $0 $144.862 $21.845 $452.000 $209.331 $0 $97.195 $401. (gas-fired) American Wind Energy Association Bechtel (gas-fired) Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co.017 $1.748 $32.240 $0 $178. McQuat.500 N/A ERG Master's Project Mark Stout 56 .750 $1.500 $29. (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. producers.543 $29.589 $26.917 $300 $5.717 $500 not applicable $0 $138.626 $0 $8.000 NA $500 $0 $2.025.782 $981.100 $0 $500 N/A $100 $0 $500 N/A $2.147 $500 $739.) 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.605 $250 N/A $1.S. (geothermal) California Cogeneration Council California Solar Energy Industry Association Cannon Energy (windpower) Colmac Energy Inc.060 $6.882 $15.032 $0 $172.905 $30.500 N/A $0 $211.100 $144.724 $500 not applicable $500 $57.600 $276. Dist. 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.000 $85.750 $267. EVs) Enron Corporation (gas fired) GWF Power Systems (oil and coal-fired) Hansen. of Jrnymn & Aprt Underground Utility/Landscape Utility Workers Union of America INDEPENDENT PRODUCERS AES Pacific/SF Energy Co.1996 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Electric Power Research Institute General Electric (nuclear plants) Pacific Gas & Electric/U.

754 $4.705 $19.000 $500 $456.689 $2. 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. diesel) Unocal (CMA member) Victory Oil Co.650 $3.950 $3.661.500 $277.500 $251.643 $1.177 $300 N/A $0 $29.138 $1. natural gas.209.050 N/A $0 $214.495 $22.384 $2.995 N/A $100 N/A $0 $3.521 $14.438 $500 N/A $0 $1.090 $749 $38.712 $100 N/A $200 $16.050 $949.925 $0 $44. (gasoline refining and marketing) Tower Energy Group (oil.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.761 $0 $73.417 $9.521 $1.000 $76.072 $918.780 ERG Master's Project Mark Stout 57 .511 $1.016 $1.885 $300 $207. Texaco Tidelands Oil Tosco Corp.407 $200 $61.334 $498 $1.960 $2.721 $748.622 $67.750 $23.900 $1.296 $800 $25.878 $12.500 $47.000 $65.636 $0 $103.532 $4.478.861 $1.245 $335.958 $2.989 N/A $9.000 $233.573 $2.347 $9.800 not tracked $3.000 $22.900 $0 $21.137 $550 N/A $5. (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.521 $0 N/A $50 $87.181 $1. (CLECA member) California Retailers Association California Steel Industries (CLECA member) Californians for Competitive Electricity Fontana Steel Kaiser Aluminum Kaiser Cement Corporation Louisiana Pacific (CMA member) Mitsubishi Cement (CLECA member) National Cement (CLECA member) Riverside Cement (CLECA member) RMC Lonestar (CLECA member) Schnitzer Steel Industries (CLECA member) Southwest Portland Cement Co.250 $34.750 $37.

438 $4.000 $2.462 $208.250 $21.068 $14.462 $500 $14.066 $500 $21.000 $700 $117. of California.585 $33. 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) $1.448 $424.000 $900 N/A $400 N/A $500 N/A ERG Master's Project Mark Stout 58 .1996 Lobbying Totals ENERGY SERVICE COMPANIES (ESCOs) Appliance Recycling Centers of America Onsite Energy (energy service company) Preferred Energy Services (energy service company) ENVIRONMENTAL ADVOCATES California League of Conservation Voters Energy Foundation/The Tides Center Environmental Defense Fund Natural Resources Defense Council Planning and Conservation League Sierra Club California Union of Concerned Scientists STATE INSTITUTIONS U.790 $100 $14.378 $100 $21.000 $15.066 $500 N/A $250 N/A $22.

Brussels. including oil and natural gas companies. were able to far outspend environmental organizations (who were usually spread thin over many issues). 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. Conservation. 4 ERG Master’s Project Mark Stout 59 . 1996. regulators. alternative energy producers. for $7. and environmental groups to discuss the British experience with deregulation of electricity. and Paris. government ministers. and Privatization” took AB 1890 author Jim Brulte and Conference Committee 79 80 Asmus. a clean power auction the CPUC repeatedly postponed upon the urging of the utility. to meet with CEOs of the electricity industry. CPUC President Fessler and Commissioner Gregory Conlon were taken by CFEE on an excursion visiting London.800 each. their “Travel project to Europe on Electric Restructuring. and Inner Mongolia. 1996. 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.79 From 3/16/94 to 3/27/94. Shanghai. and small consumer groups. the lobbying summary tables above.As one would imagine.167 per guest. According to investigative writer Peter Asmus. as well as the legislator breakdown tables and gift descriptions in Appendix E show that IOUs and large consumers. CFEE is a “non-profit. “though the CPUC had imposed a ban on communications regarding the Biennial Resource Plan Update (BRPU). charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure. paying up to $7. From 3/28/96 to 4/8/96. 4 Asmus. an Edison lobbyist was added to the international travel party at the last minute.”80 In April of 1995.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

93

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

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

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

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

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

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

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

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

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

economically viable solutions to today’s environmental problems.Environmental Advocates Environmental Defense Fund Dan Kirshner is a Senior Economic Analyst for EDF. if restructuring is implemented properly: 1) energy efficiency investments should continue.”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.000 of whom live in California. 3) externality accounting should ensure that customers weigh external costs in their decisions among alternate suppliers. we are in favor of competition. [which] represents 300. Assuming these problems are resolved. ERG Master’s Project Mark Stout 119 . It gave us nothing until the Legislature tells us otherwise. E-1.000 members nationwide. EDF links science. EDF supports the earliest possible implementation of direct access for all classes of customers. If focusing 94 CPUC Renewables Working Group. and punted on the details to the Legislature. depending on interpretation. EDF has participated in California energy policy issues since 1975. As stated in EDF’s first round comments on the Blue Book. and law to create innovative. 2) an Integrated Resource Planning process should exist for energy efficiency. economics. yes. “There is no reason to proffer the benefits of competition first to only selected classes of customers.”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. The Decision was vague. 1995 Decision? Almost nothing. more than 55. and 4) incentives for uneconomic sales promotion minimized. “a leading non-profit organization.

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

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

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

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

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

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

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

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

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

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

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

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

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

UCS has 100.000 in California”. Integrated Resource Planning (IRP). As the deregulation process unfolded at the CPUC. including 13. a policy decision that is widely viewed as a financial 100 CPUC Renewables Working Group. UCS’s overriding goal was to ensure policy were developed that would provide for continued environmental protection with regards to renewables and energy efficiency. Deregulation of the electricity industry threatened to tear this house of cards down. “an independent nonprofit public interest organization which works on issues where science and technology play a critical role. pointing towards a future based on environmentally cleaner electricity generation and energy efficiency. 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. Jane conjectured that one of the driving forces behind deregulation was to do away with utility requirements that were designed to protect environmental quality. manifest in California as the Biennial Resource Plan Update (BRPU). ERG Master’s Project Mark Stout 133 . was just beginning to be used as a policy option in several states. As long as the Sierra Club and other groups were happy.000 sponsors nationwide. E-3.John White were the front folks. The level of renewables support included in the BRPU served as a target for UCS. UCS was also opposed to 100% “stranded cost” recovery for utilities. Union of Concerned Scientists Jane Kelly is the California Policy Coordinator for the Union of Concerned Scientists. Peace was the idea person.100 What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? According to Jane. Byron Sher was fine.

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

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

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

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

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

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

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

for instance by Jud King. One would need to augment budgets so the agencies were not hit. Consequently.purchase a given percentage of their electricity. it was vague. phasing in over time. AB 1890 passed unanimously on the floor. It could have gone further by laying out steps needed in legislation. University of California. but is instead offering personal observations. he is not representing the position of the University. the Vice-Provost of the UC system. In the process of recent years. from renewable generators. utility funding for CIEE had been cut off. 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. We were fighting for restoration of this funding from October of ‘94 to December of ‘95. After the passage of AB 1890. This R&D funding cut provided a concrete example of what was being lost in the move to deregulate the electric utility industry. there was no attempt to amend it. 1995 Decision? We agreed with the stated principles of the Decision. ERG Master’s Project Mark Stout 141 . contacts between the two commissions has been informal. Also. there were no dollar figures given for public interest RD&D. In this interview. a group at the University of California involved with energy efficiency research and development (R&D). The CEC has a role allocating the lion’s share of the $62.5 million public purpose RD&D annual budget. California Institute for Energy Efficiency Carl Blumstein is the Associate Director of the California Institute for Energy Efficiency (CIEE). How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. This has been affirmed in statements by University Provosts.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Interview #2 INDEPENDENT PRODUCERS American Wind Energy Association Independent Energy Producers LARGE ELECTRICITY CONSUMERS Agricultural Energy Consumers Association California Industrial Users California Large Energy Consumers Association .Interview #2 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council . 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 Sierra Club Union of Concerned Scientists STATE INSTITUTIONS California Energy Commission University of California.Interview #1 California Large Energy Consumers Association .Interview #1 California Municipal Utilities Association .Appendix D: Cluster Analysis of Stakeholder Interview Data How much of what you wanted was in the December Decision? INVESTOR-OWNED ELECTRIC UTILITIES Pacific Gas & Electric San Diego Gas and Electric Southern California Edison MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association .Interview #1 Coalition of California Utility Employees .Interview #1 Natural Resources Defense Council .Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees .

Interview #1 Coalition of California Utility Employees .Interview #1 California Municipal Utilities Association . 0 0 1 0 1 1 3 9 10 ERG Master’s Project Mark Stout 160 .Interview #2 INDEPENDENT PRODUCERS American Wind Energy Association Independent Energy Producers LARGE ELECTRICITY CONSUMERS Agricultural Energy Consumers Association California Industrial Users California Large Energy Consumers Association .Interview #1 Natural Resources Defense Council .How much of what you wanted was in AB 1890? INVESTOR-OWNED ELECTRIC UTILITIES Pacific Gas & Electric San Diego Gas and Electric Southern California Edison MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association . California Institute for Energy Efficiency Total note: 1 selects column Rather Little Mixed/Unclear Most 0 0 3 1 1 1 0 2 0 1 1 0 0 2 1 1 1 1 3 1 1 1 1 1 0 0 1 1 1 1 1 1 1 4 1 1 1 1 1 1 .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 #1 California Large Energy Consumers Association .

Interview #2 INDEPENDENT PRODUCERS American Wind Energy Association Independent Energy Producers LARGE ELECTRICITY CONSUMERS Agricultural Energy Consumers Association California Industrial Users California Large Energy Consumers Association .Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees . California Institute for Energy Efficiency Total note: 1 selects column ERG Master’s Project Mark Stout 161 .Interview #1 California Large Energy Consumers Association .Interview #1 Coalition of California Utility Employees .Interview #2 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council .Which Policy Outcome Does Your Organization Prefer? INVESTOR-OWNED ELECTRIC UTILITIES Pacific Gas & Electric San Diego Gas and Electric Southern California Edison MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association .Interview #1 California Municipal Utilities Association .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 Natural Resources Defense Council .

(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 $1.500 $22.495 $1.000 $1.800 $1.000 $7.000 $495 $950 $696 $2.000 $4.000 $1.) California Independent Oil Marketers Association Chevron (CMA member) Mobil Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $22.495 $7.000 $1.000 $2.000 $2.000 $3.000 $500 $1.495 $10.Appendix E: Restructuring Stakeholder Campaign Contribution/Gift Analysis Detail Table 1: Assemblymember Jim Brulte.191 $2.429 $498 $1.995 $300 $12.995 $21.000 $3.000 $3. 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.896 $3.000 $0 $0 ERG Master’s Project Mark Stout 162 . Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.

511 $3. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int.000 $1.990 $1.000 $1.500 $47.017 $749 $750 $3.995 $1.250 $2.Table 2: Assemblymember Jim Brulte.750 $4.000 $3.995 $2.995 $14. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades INDEPENDENT PRODUCERS CalEnergy Co.500 $1.500 $800 $498 $200 $9.995 $0 $0 ERG Master’s Project Mark Stout 163 .500 $1. (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.000 $1.460 $200 $500 $750 $2.000 $8.000 $2.000 $10.000 $2.495 $4.) California Independent Oil Marketers Association California Independent Petroleum PAC Chevron (CMA member) Exxon Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $28. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.500 $6.

Sweden. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.000 $1.000 $2.750 $3. and Budapest.1995/1996 Stakeholder Gift Information for Assemblymember Jim Brulte In 1995.000 $1.000 $1. Brulte was taken on a $7.000 $2.750 $2. by the California Foundation on the Environment and the Economy.250 $500 $1.000 $3. and Privatization” visiting London. AB 1890 author Assemblyman Jim Brulte accepted no gifts from stakeholders. Conservation.000 $750 $0 $0 103 Asmus. Mobil treated Brulte to a $60 event in 1996. totaling $101. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure103.490 “Travel project to Europe on Electric Restructuring. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int. Not to be outdone. (geothermal) Indpependent Energy Producers OIL AND NATURAL GAS COMPANIES California Independent Petroleum PAC Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $11. 1996. Table 3: Senator Steve Peace.500 $1. Paling in comparison. CFEE is a “non-profit. From 3/28/96 to 4/8/96. Chevron treated Brulte to two meals. as well as an event.750 $750 $1. 4 ERG Master’s Project Mark Stout 164 .

) California Independent Petroleum PAC Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $48.815 $750 $6.600 $2.000 $300 $1.000 $750 $750 $750 $1.250 $1.750 $0 $0 ERG Master’s Project Mark Stout 165 .500 $16.250 $2.072 $2.115 $18. 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.050 $3.000 $4.450 $7.250 $7.500 $8. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.100 $2.Table 4: Senator Steve Peace.250 $750 $500 $1.572 $1.000 $1. (geothermal) California Solar Energy Industry Association Cannon Energy (windpower) Destec (gas-fired) Independent Energy Producers Pacific Lumber Company (solid fuel biomass) SeaWest Windpower Zond Windpower DSM ENERGY SERVICE COMPANIES (ESCOS) SESCO (energy services) LARGE ELECTRICITY CONSUMERS California Manufacturers Association California Retailers Association California Steel Industries (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $500 $2.000 $6.500 $3.

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 $1.450 166 ELECTRIC/GAS $6.000 $5. In 1995. taking Steve to 11 meals. he maintained a pretty low profile in 1995 and 1996 in terms of accepting gifts and trips. SDG&E had Peace out to six meals. Peace was treated to a $52 sports event by Mobil Oil.900 . SDG&E pulled on Peace’s ear over a sports event and meal totaling $89. as well as chair of the Senate Energy and Utilities Committee. In 1996.100 $2. 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. IEP made a gift of $241 for his speech at a conference. Table 5: Senator Byron Sher. Southern California Edison was granted a high level of access.000 Table 6: Senator Byron Sher. Peace began a practice of reimbursing all utilities for meals and outings starting with Edison in 1995. while Edison treated him to five meals and a sports event.1995/1996 Stakeholder Gift Information for Senator Steve Peace Given Steve Peace’s prominence as chair of the Conference Committee on Electric Utility Restructuring.

(geothermal) Colmac Energy Inc.882 $100 $1. Inc (consultants) $200 ERG Master’s Project Mark Stout 167 . (biomass) Edson + Modisette (lobbyist for indep.000 $500 $1.482 $100 $1. EVs) Hansen. (gas-fired) American Wind Energy Association Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co. $2. Brotherhood of Electrical Workers (various $9.100 $500 $2. and Hamrin. of Journeymen & Apprentice Underground Utility/Landscape INDEPENDENT PRODUCERS AES Pacific/SF Energy Co.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 $1.600 $13.000 $100 producers.500 Int.000 locals) Southern California Pipe Trades United Assoc.000 $500 $500 $9. McQuat.

000 $1.000 Large Energy Consumers $3.Indpependent Energy Producers Modesto burning) SeaWest Windpower United American Energy Wadham Energy Limited Partnership (biomass) Zond Windpower DSM ENERGY SERVICE Energy Limited Partnership $1.000 $100 $100 $500 $1.000 $100 $1.500 COMPANIES $1.000 (tire $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 $1.250 $100 $50 $500 $500 $250 ERG Master’s Project Mark Stout 168 .

California Institute for Energy Efficiency California Integrated Waste Management Board (biomass proponents) Nevada Community Action $1. (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.462 $100 $900 $400 $500 ERG Master’s Project Mark Stout 169 .448 $14.000 $300 $300 $22.000 $700 $4. of California.Tosco Corp.585 $100 $500 $2.

400 $750 $150 $1. Sher holds over $100. Mobil. NARUC treated Sher to a two day trip to DC for another meeting.500 $0 $0 ERG Master’s Project Mark Stout 170 .500 $300 $0 $0 $2. and GE. totaling $2608. 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. Sher received no other gifts that year from energy utility stakeholders.000 in each of Amoco.000 $1. totaling $758. In 1996. 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. Exxon.1995/1996 Stakeholder Gift Information for Senator Byron Sher In 1995. but his Statement of Economic Interest reveals large holding of oil and electricity stocks.300 $500 $1. Table 7: Senator Bill Leonard.

Edison’s lobbyists got to spend a little more quality time with Leonard for their money. WA paid $734 for Leonard to moderate a conference session on utility deregulation.000 $2.000 $500 $500 $4.650 $500 $1.000 $1.000 $0 $0 1995/1996 Stakeholder Gift Information for Senator Bill Leonard In 1995. SDG&E bought Leonard a $125 ticket to the Pete Wilson Inaugural Gala.Table 8: Senator Bill Leonard.080 $10. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.500 $150 $500 $3. The Pacific Rim Conference of Seattle. 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. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS California Mining Association PAC California Portland Cement Co. for a paltry $20. SCE treated him to a $30 beach party and a $20 lunch with lobbyist Bob Foster. and a $75 dinner at the American Legislative Exchange Council’s annual meeting. Senator Leonard was courted a little more heavily by energy stakeholders in 1996. While the Senator was there.000 $1.) Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $19.650 $2. extending his stay from 12/8/96 to 12/13/96. saving up for a $77 dinner with head lobbyist Bob Foster. SCE treated Leonard to dinner and lodging for Legislative Ski Day.000 $5. (CLECA member) California Steel Industries (CLECA member) Mitsubishi Cement (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.730 $2.000 $2. Edison again ERG Master’s Project Mark Stout 171 .500 $500 $1.000 $2.

000 $1.600 $750 $750 $500 $1. for the modest tab of $56. including lunch with Bob Foster.000 $750 $750 $650 $150 $500 $3.250 $1. Table 9: Assemblymember Mickey Conroy. PG&E took Leonard out to a Kings game.000 $1. 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. paying $44 for two meals and lodging.250 $750 $0 $0 ERG Master’s Project Mark Stout 172 . ARCO treated Leonard to a $19 meal at a reception.600 $1.) Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $6.750 $1.had Senator Leonard out for Legislative Ski Day.000 $1. They also had Leonard out for two meals in Sacramento.

500 $2.000 $5. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades INDEPENDENT PRODUCERS Destec (gas-fired) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS Adams Steel California Portland Cement Co.Table 10: Assemblymember Mickey Conroy.600 $3. (CLECA member) California Steel Industries (CLECA member) Louisiana Pacific (CMA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $3. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS California State Pipe Trades Council PAC Int.700 $500 $300 $550 $2.300 junket to talk with Chinese central government and provincial leaders in Beijing.050 $1. and Inner Mongolia. Shanghai. and to 104 Asmus.000 $500 $2. the California Foundation on the Environment and the Economy took Conroy on an 11 day. CFEE is a “non-profit. Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $9.000 $2. 4 ERG Master’s Project Mark Stout 173 . PG&E treated him to a basketball game with $51 tickets.000 $500 $750 $250 $500 $2. 1996.700 $750 $450 $250 $250 $1.000 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Mickey Conroy In April of 1995. $7. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure104. two meals for $44.) California Independent Petroleum PAC Chevron (CMA member) Southern Counties Oil Co.600 $500 $1.

with investments of greater than $10. $10 in candy.000 in Orange & Rockland Utilities. After such a busy social calendar in 1995. four rounds of “refreshments” for $30. In terms of investment.make sure Conroy kept a sweet spot in his heart for them. ERG Master’s Project Mark Stout 174 . it is surprising that no electric utility deregulation stakeholders made any gifts to Assemblymember Conroy in 1996.000 each in Edison. costing $99. and less than 10. Pacificorp. the Assemblymember seems to have a penchant for electric utilities and nuclear power plant manufacturers. Edison wined and dined the Assemblymember with four meals at $134. General Electric. SDG&E. Kansas City Power & Light. and $25 of cookies and candy. Chevron took Conroy out for two business meals. and Westinghouse Electrical.

(geothermal) Indpependent Energy Producers OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.750 $1.Table 11: Assemblymember Diane Martinez.250 $1.750 $1.750 $750 $500 $500 $750 $0 $0 ERG Master’s Project Mark Stout 175 .000 $1.175 $500 $1.250 $1.675 $2.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.750 $2.750 $4.000 $1.750 $2. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.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.

000 $1.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $20. (CLECA member) California Steel Industries (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.750 $1.500 $1. Dist.000 $0 $0 ERG Master’s Project Mark Stout 176 .250 $1.500 $1.000 $1.500 $1.500 $6.000 $4.000 $500 $1.000 $500 $500 $500 $500 $500 $3.500 $500 $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. (member of IPPs of NY) Zond Windpower LARGE ELECTRICITY CONSUMERS California Manufacturers Association California Portland Cement 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 MUNICIPAL ELECTRIC UTILITIES Gualco Group (lobbyist: Imperial & Modesto Irigatn.) UTILITY LABOR UNIONS California State Association of Electrical Workers Int.000 $4.500 $1.000 $7.Table 12: Assemblymember Diane Martinez.000 $5.000 $1.000 $500 $500 $5.000 $500 $3. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.

467 trip to Northwestern University to discuss the deregulation of public utilities.600 $1. (bulk terminals) Mobil Tidelands Oil Tower Energy Group (oil. The Assemblymember enjoyed no such gifts from deregulation stakeholders in 1996. 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.000 $8.058 $500 $500 $1.) California Independent Oil Producers Chevron (CMA member) Kaiser International Corp.000 $500 $500 $1. the Illinois Energy Association flew Martinez out for a $1.000 $1.600 $500 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Diane Martinez In 1995.500 $1.850 $1.208 $0 $0 $1.Table 13: Assemblymember Steve Kuykendall. natural gas. diesel) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7. ERG Master’s Project Mark Stout 177 .900 $3.100 $100 $1.500 $1.

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 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.350 $500 $1.500 $0 $1.500 $1.374 $4. Kuykendall was taken on a $7. However.000 $1. From 3/28/96 to 4/8/96.250 $100 $500 $35.000 $2.443 $6. and Privatization” visiting London. Conservation. Western States Petroleum Association treated Kuykendall to a reception and a dinner totaling $62. natural gas.989 $500 $500 $0 $0 1995/1996 Kuykendall Stakeholder Gift Information for Assemblymember Steve In 1995.254 $200 $500 $4. and Budapest.000 $1.374 $500 $2.) California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Mobil Texaco Tidelands Oil Tower Energy Group (oil.490 “Travel project to Europe on Electric Restructuring. ERG Master’s Project Mark Stout 178 . Sweden. diesel) Unocal (CMA member) Victory Oil Co.Table 14: Assemblymember Steve Kuykendall.000 $500 $2. SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $10. Kuykendall’s social calendar was destined to pick up in 1996.000 $19.

a clean power auction the CPUC repeatedly postponed upon the urging of the utility. SC to address their membership. wholesale PoolCo model. 1994/1995 Stakeholder Gift Information for CPUC President Daniel Fessler From 3/16/94 to 3/27/94. The Large Public Power Council.167 junket visiting London. According to investigative writer Peter Asmus. spent $516 to fly Fessler to a “Series on Energy Efficiency in the 21st Century”. one of CFEE’s funders. Brussels. 1996. was very interested in California moving to the UK-style.by the California Foundation on the Environment and the Economy. to meet with CEOs of the electricity industry.”105 The Consolidated Edison IOU spent $1. government ministers. by the California Foundation on the Environment and the Economy. The Aspen Institute. “though the CPUC had imposed a ban on communications regarding the Biennial Resource Plan Update (BRPU). in Aspen. regulators. spent $1402 to fly Fessler to Charleston. for $610. an Edison lobbyist was added to the international travel party at the last minute. Chevron treated Kuykendall to two dinners for $131. Edison. and environmental groups to discuss the British experience with deregulation of electricity. CO. The Energy Foundation flew him to Colorado twice for “Future of Utilities” and “Utility Futures IV” meetings. The California 105 Asmus. The California Mining Association took him out for an evening of recreation and dinner costing $89.051 to fly the President out to New York City for a ConEdison Management Conference. A trade association. known as the Council of States Government . paid $1.916 for the Assemblymember to speak and moderate a panel discussion on electric utility deregulation. Fessler was taken on a $7. and Paris. 4 ERG Master’s Project Mark Stout 179 . Another non-profit organization.WEST. a trade association for publicly owned utilities.

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

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

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