Energy and Resources Group Master’s Project

Mark Stout 5/25/1997

Comparative Power Analysis of the California Electric Utility Industry Deregulation Process

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

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

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

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

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

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

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

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

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

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

ERG Master’s Project Mark Stout 12 . 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. 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. 1996. 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. In April of 1994. the CPUC issued a staff proposal regarding electric utility deregulation known as the “Blue Book”. Hoffman.supplies. and 3) rate changes to encourage efficiency and distribution of power. 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. customer class-staged schedule for direct access implementation. 2002. The Blue Book laid out an aggressive. sending “a shockwave through the electric industry”.17 A security analyst noted that the release of the Blue Book will: speed up the deregulation of the industry. and if successful. all residential consumers eligible on January 1.”16 CPUC “Blue Book” Proposal California’s Public Utility Commission is widely viewed as a trend-setter for state PUC electric utility regulation. 55. with large. 6. 1999. 18 Mydans.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. industrial customers taking power at the transmission level eligible on January 1.

FERC released a dual-issue Notice of Proposed Rulemaking. 21 CPUC. 1994. which requires the CPUC to engage in a series of public hearings. 1994. 1995. and documentation resulting in a report back to the Governor and Legislature by January 31. Wagner. such as “green pricing”. which had been dubbed the MegaNOPR. 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. prompted the Assembly Committee on Utilities and Commerce and the Assembly Committee on Natural Resources to hold a joint oversight hearing on May 23. where CPUC President Fessler and Commissioner Knight testified on their proposal. Status Report. This process tempered the CPUC’s frenetic timetable. 1. In their place. The first issue addressed open access to the transmission system 19 20 CPUC. For instance.scheduled to be issued by the CPUC in August of 1994. 1995. coupled with a lack of prior coordination with the state Legislature. numerous other states have also proposed electric utility deregulation. the CPUC proposed.20 Many stakeholders. pushing back their goal for a policy decision until September of 1995.22 FERC MegaNOPR In March of 1995. Blue Book.19 Since the release of the Blue Book proposal. and asserted that. 1994. evidentiary hearings. including private and public-interest organizations. were concerned about the content and timetable of this proposal. “a vibrant market exists for energy efficiency services”. Blue Book. where customers voluntarily pay more to promote renewables. This led to the passage of Assembly Concurrent Resolution 143.21 This stakeholder response. ERG Master’s Project Mark Stout 13 . “alternative frameworks based on ‘let the market decide’”.

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

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

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

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

compared to the reckless pace of the legislative wrangling. omnibus legislation which preempts much of the PUC vision31. and especially residential and small commercial California ratepayers. neither process involved substantial public education or participation."33 However. arguing that it should not be used as a national model for protection of residential and small commercial consumer interests. 1996 31 Rader. 1996 Roadmap CPUC press release. As the PUC stakeholder working group process drew to an end. the final product of this bipartisan conference committee handily passed on the Senate and Assembly floors with minimal debate. small consumer group.committee on deregulation worked at breakneck speed. and confidential correspondence with stakeholder representative. Pete Wilson signed AB 1890 on September 2330. While the pace of the PUC process was tempered so that their final policy decision could better reflect stakeholder interests. 1996 ERG Master’s Project Mark Stout 18 . has criticized AB 1890. 1996 32 Weisman. Even given the large economic and environmental stakes. TURN. December. a prominent. since it was perceived as a best effort compromise between the two main political parties. 33 CPUC press release. but some have argued that the environmental organizations are not effectively representing the interests of their constituencies32. 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. Several public interest organizations served as advocates for small consumer and environmental protection. cutting deals with the stakeholders that would be required to “deliver the votes” within the committee. 1995 Decision. other market participants. 1996 34 TURN press release. 1997.34 There is concern that 29 30 CPUC.

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

1996 CEC. would be eligible for direct access January 1. including residential and small commercial consumers. 1998. 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.”39 Recent State and Federal Activity Since the signing of AB 1890 into law. the CPUC released its latest restructuring decision which surprised stakeholders by announcing that all customers. “If the bill had failed. In March of 1997.41 There are currently several electric utility restructuring bills in Congress. the California PUC was on a clear course to abandon all [funding for public purpose programs] on grounds of lack of statutory authority. 1997 41 Marshall. “Primed for Congressional Battle” ERG Master’s Project Mark Stout 20 . As Carter and Cavanagh have noted. 10% emerging technologies. It divides up this amount into four accounts that vary over four years of funding. chair of the House Energy and Power Subcommittee. 1997. 1997 42 Weisman. The overall levels are: 45 % existing technologies. and 15% consumer-side incentives. including a prominent one authored by Representative Dan Schaefer (R-CO).40 On May 6. 1997.42 This bill includes a "minimum renewable energy generation 39 40 Carter and Cavanagh. the CPUC and California Energy Commission (CEC) have been working towards the implementation of this legislation.environment/equity agenda” which had gripped the industry since the release of the Blue Book in 1994. 30% new technologies.

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

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

who in the past had enjoyed privileged status with cheap rates.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.. basing their arguments on welfare economics as applied to the changing electric utility landscape. ERG Master’s Project Mark Stout 23 . 1994. 50 Flavin and Lenssen. Gordon.51 Academics & Ideologues Neo-classical economists have argued since the 1970’s for the deregulation of the electric utility industry. 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. 195. Hoffman 55-62. Davis. Advancements in transmission line technology now allow the efficient transmission of electricity for distances of hundreds of miles. 150. 447-475. but now had to pay higher rates..intense pressure from large industrial customers. 51 Stevenson. enabling increased competition. 356-357. ”49 Technology The development of gas turbine generation technology has greatly reduced the scale requirements for efficient electricity generation. “Discretionary Evolution. 52 Gilbert. greatly increasing opportunities for bulk power sales. 1993.”. 1993. 84-108.

generating capacity has been supplied by alternative. non-utility providers. and it was only 53 54 Stevenson.S. Stevenson. Existing Competitive Forces Although electric utilities are often viewed as pure monopolies. ERG Master’s Project Mark Stout 24 . Many electrical applications have substitutable fuels. “With this act. 55 Flavin and Lenssen. such as natural gas for space heating. “Discretionary Evolution. the camel of competition forced its nose under the monopoly tent. “Discretionary Evolution. Utilities compete for industrial customers who are relocating. 357. over half of new U. 1994. Examples of national electric utility deregulation have already been provided by the United Kingdom and Norway. 355-356.56 Federal Regulatory Policy By requiring utilities to pay avoided costs to the new class of qualifying facilities.53 allowing a policy trend that emphasizes markets rather than social welfare. as well as those on the border of service districts.”.the academic rationale for the recent flurry of deregulation activity being pushed by free-market ideology.. the 1978 Public Utility Regulatory Policies Act greatly invigorated the wholesale market for electric power.. There is significant competition in the wholesale electric generation market.. 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.”. competition takes on several forms in this market.54 Since 1992..

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

559 $0 $246.500 $533.1995 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear plants) Joint Electrical Industry Fund Pacific Gas & Electric/U. (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 $59.092 $3.419 $13.500 $190.000 $634.374 $1.149 $3. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.000 $681.608 $3.470 $10.112 $3.835 $1.741 $21.239 $0 N/A $0 $89.479 $2.000 $480.272 $0 $64.758 $2.496 $8.952 $1.818 $0 $65.000 $62.110 $34.125 $0 $4.500 $78.752 $0 $51.203.308 $516.079 $13.370 $648 N/A $0 $208.981 $1.000 N/A $0 $18. 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.166 $5.595 $0 $21.075 $4.416 $5.405 $0 $722.102 $0 $73.153 $750 N/A $8.500 $263.000 $562.163 $0 $25.180 $0 $209.516.745 $68.079 $950 $14.819 $0 $323.000 $1.181 $0 $160.675 $736.588 $500 $32.000 $225.S.031.995 $596.157 $0 $188.675 $384.592 $846 $0 ERG Master's Project Mark Stout 54 .630 $300 N/A $0 $5.096 $971.101 $495 $10.964 $0 $40.500 $1.000 $0 $70.

081 $1.055 $0 $151.495 $27.003.000 $524.000 $20.600 N/A $5.492 $0 $66.000 $0 $171.197 $500 N/A $2.716 $39.600 $32.291 $3.519 $11.230.250 $0 $30.938 $0 $118.500 $0 $0 ERG Master's Project Mark Stout 55 .723 $0 $38.551 $12.145 $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 Kaiser International Corp. (gasoline refining and marketing) Tower Energy Group (oil.000 $383.675 $0 $1.319 $0 $10.400 $100 $79.495 $1.207 $5. natural gas.083 $0 $20.099 $12.271 $0 $12.362.167 $500 $25. diesel) Unocal (CMA member) Western States Petroleum Association SMALL ELECTRICITY CONSUMERS Greenlining Institute The Utility Reform Network (TURN) Utility Consumer's Action Network (UCAN) ENERGY SERVICE COMPANIES (ESCOs) Appliance Recycling Centers of America ENVIRONMENTAL ADVOCATES California League of Conservation Voters Center for Energy Efficiency and Renewable Technologies Environmental Defense Fund Natural Resources Defense Council Planning and Conservation League Sierra Club California Union of Concerned Scientists STATE INSTITUTIONS Note: N/A = not available Conference Committee Campaign Total California Contributions Lobbying Expenses $0 $4.000 $0 $15.000 $526.850 $1. (bulk terminals) Mobil Texaco Tidelands Oil Tosco Corp.701 $0 $5.401 $1.203 $5.665 $0 $262.947 $500 $281.000 $37.000 $0 $6.203 $0 $30.596.1995 Lobbying Totals RMC Lonestar (CLECA member) Southwest Portland Cement Co.326 $0 $100.

(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) $145.000 N/A $100 N/A $7.159 $3.750 $418.060 $6.000 $33.400 $1.000 $85.862 $21.605 $250 N/A $1.118 $0 $144.200 $837.179 $0 $3.000 $209. Dist. Generating Company San Diego Gas and Electric/Enova Southern California Edison/Mission Energy/Edison International Southern California Gas/Pacific Enterprises MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association Gualco Group (lobbyist: Imperial & Modesto Irigatn.S. 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.250 N/A $100 N/A $2.454 $3.571 $500 N/A $200 N/A $1.845 $452. producers. of Jrnymn & Aprt Underground Utility/Landscape Utility Workers Union of America INDEPENDENT PRODUCERS AES Pacific/SF Energy Co.782 $981.331 $0 $97.025.450 $566.500 $29. EVs) Enron Corporation (gas fired) GWF Power Systems (oil and coal-fired) Hansen. (gas-fired) American Wind Energy Association Bechtel (gas-fired) Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co.000 $50.000 NA $500 $0 $2. (geothermal) California Cogeneration Council California Solar Energy Industry Association Cannon Energy (windpower) Colmac Energy Inc.543 $29.147 $500 $739.917 $300 $5.589 $26.626 $0 $8.748 $32.500 N/A $0 $211.286 $3.032 $0 $172.281 $1.1996 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Electric Power Research Institute General Electric (nuclear plants) Pacific Gas & Electric/U.590 $5.750 $1.611 $1.) 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.724 $500 not applicable $500 $57. (biomass) Destec (gas-fired) Edson + Modisette (lobbyist for indep.905 $30.600 $276.100 $144.460 $50. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades United Assoc. McQuat.250 $148.717 $500 not applicable $0 $138.195 $401. and Hamrin.000 $35.100 $0 $500 N/A $100 $0 $500 N/A $2.882 $15.819 $921.240 $0 $178.500 N/A ERG Master's Project Mark Stout 56 .750 $267.229 $100 N/A $1.017 $1.

500 $251.050 N/A $0 $214. (gasoline refining and marketing) Tower Energy Group (oil.925 $0 $44.090 $749 $38.689 $2.950 $3. diesel) Unocal (CMA member) Victory Oil Co.296 $800 $25.754 $4.712 $100 N/A $200 $16.334 $498 $1.438 $500 N/A $0 $1.250 $34.705 $19.521 $0 N/A $50 $87.000 $76.1996 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.384 $2.245 $335.643 $1.138 $1.861 $1.900 $1.000 $233. (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.780 ERG Master's Project Mark Stout 57 .900 $0 $21.417 $9.495 $22.521 $14.209.878 $12.636 $0 $103.573 $2.500 $47.500 $277.521 $1.750 $37.721 $748.181 $1.532 $4. Texaco Tidelands Oil Tosco Corp.000 $65.989 N/A $9.995 N/A $100 N/A $0 $3.347 $9.072 $918.000 $22.800 not tracked $3.661.958 $2.885 $300 $207. natural gas.177 $300 N/A $0 $29.511 $1.137 $550 N/A $5.016 $1.761 $0 $73.050 $949.750 $23.000 $500 $456.960 $2.622 $67.478. (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. 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) $41.650 $3.407 $200 $61.

of California.066 $500 N/A $250 N/A $22.462 $500 $14.250 $21.1996 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.462 $208.585 $33.000 $900 N/A $400 N/A $500 N/A ERG Master's Project Mark Stout 58 .790 $100 $14.378 $100 $21.066 $500 $21.068 $14.000 $2. California Institute for Energy Efficiency California Integrated Waste Management Board (biomass) Note: N/A = not available Conference Committee Total California Campaign Lobbying Expenses Contributions (Jan-Sept) $1.438 $4.448 $424.000 $15.000 $700 $117.

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

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

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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and why? Which stakeholder groups do you think could have been more effective in influencing the policy formulation process. CPUC vs. and how could they have improved their approach? Was it always clear what outcomes each stakeholder group wanted from the process? ERG Master’s Project Mark Stout 66 .. 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.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.e. AB 1890)? Why? Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. or over time? What methods and approaches were used to advance your organization's goals and objectives in the CPUC hearings and the subsequent decision? What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? Officeholder Staff Interviews • • • • • Which stakeholder groups do you think were most effective in influencing the policy formulation process of ____________ and what were they able to obtain from the process? What methods or strategies did these effective groups use to influence the process? Was any particular method or sets of methods most influential? Which stakeholder groups do you think were best able to set the terms of the debate.

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

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

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

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

and got it struck down. We were very opposed to the BRPU. they did not get there by investing in high cost renewables. AB 1890 mirrors the Decision in many ways. 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. so we would have to buy energy or credits. we had the highest rates in the nation. 84 CPUC Renewables Working Group. We were strongly opposed to the RPS. if you are a broker.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. This would put us at a competitive disadvantage compared to PG&E and Edison. High priced renewables are OK if you are not moving to a competitive future. except for electricity purchases from Mexican geothermal generators. ERG Master’s Project Mark Stout 71 . We went to FERC.84] SDG&E does not have any renewables. everyone should pay. Throughout the ‘70s. SDG&E wanted to become the lowest priced California IOU. it would be difficult to get 5% renewables. SDG&E was a supporter of the PoolCo market structure along with Edison. When Tom Page came in as CEO in 1981. 1995 Decision? The PUC was on the right track. Also. It does not make sense for SDG&E alone to go out and acquire more expensive renewable resources. The lucky Arizona utilities went with coal. with the exception of the legislation’s mechanism for a rate reduction. 1996. but are not viable with competition. [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.

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

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

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

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

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

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

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

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

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

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

SMUD did get something more than we asked for also. and conditions on CTC recovery. but it might be for others. We did not get everything we wanted. someone can accuse us of having rates too high. ERG Master’s Project Mark Stout 82 . A lot of AB 1890 is not crisp. AB 1890 has language written that denies a muni’s ability to impose a CTC unless they allow direct access. This is arguably a meaningless statement. 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. How this is playing out. we can point to the legislation. a cloud that we do not need. but arguably gives standing to third parties to contest SMUD’s approach to restructuring. This is a profound shift in how munis and IOUs relate to FERC. not to say that we can’t operate as business as usual. 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.public purpose programs. AB 1890 also set time limits on the duration of CTC recovery. this gives us political standing. this is not onerous or burdensome. But this language could burden us with litigation. For us. enhancing our stature at the federal level. If we do not go to direct access. If the Legislature had respect for the municipal affairs doctrine. it would not have put this in. I do not know. If the IOUs do not respect the munis. AB 1890 states that filings to FERC would be jointly between the municipal utilities and the IOUs. but got more than we asked for. It would have been difficult for the IOUs to keep up with us on these programs and bring down rates. This is an infringement on municipal autonomy. This is not a problem for SMUD. Going in. because the repayment of current debt could be viewed as a CTC. As I mentioned.

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

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

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

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

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

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

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

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

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 . At one point towards the end of the Conference Committee process. “incredible time crunch. resulting in very little control for AWEA. Nancy remembers that the conference committee meetings were occurring in an. Chairman Peace. had killed the RPS before any discussion began. AWEA relied mainly on Senate and Conference Committee hearings as well as input on draft legislative language to influence the policy outcome. “Knight was sold on the RPS concept because he is a believer in markets.” Nancy did feel that AWEA got things derailed out of the conference committee that would have been worse than what eventually emerged. and people were not listening to arguments. The new CPUC President Conlon tried to put the RPS back on the table for discussion. By melting down the proposed language. 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. Nancy continued to describe the process: “Time was too short. In retrospect. but Peace killed it again. Nancy said she.” What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? In contrast.Nancy feels that.” The Committee Chairman. There were major egos on the Conference Committee with pre-formed opinions. “trusted in the process. Steve Peace. AWEA lobbyist Joe Caves was able to get John White’s customer rebate proposal pulled from the draft language. with many issues being ironed out at once. and it worked.” One issue that hampered Nancy was that the Independent Energy Producers (IEP) representative “had control of the pen for draft language.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

The ability to fund politicians helped. it was all over. it was very interesting how the environmentalists and renewables fought each other when it was clear the money had to be split. Labor wanted to protect their employees. It looks most likely that it will be adopted. such as irrigation districts and economic development rates. Was it always clear what outcomes each stakeholder group wanted from the process? Yes. you must play. 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. However. and look for ways to get around paying the CTC. What methods or strategies did these effective groups use to influence the process? Was any particular method or sets of methods most influential? Getting the help of the Governor’s office. Once the Governor’s office was behind the MOU. Bill Leonard said that if you want to charge an exit fee. Bill Leonard did not historically support ratepayer funding for renewables. causing chaos. He walked out at one point to force the munis to make up their mind. The IOUs got complete stranded cost recovery. There was a lot of play between SMUD and the large customers. 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. while the large customers got the ability to go first on direct access. ERG Master’s Project Mark Stout 155 . SB 90 is the vehicle to make the CEC report on allocating renewables funding into statute. Political clout can be bought with lobbying and campaign contributions.

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

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

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

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 .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 #2 Sierra Club Union of Concerned Scientists STATE INSTITUTIONS California Energy Commission University of California.Interview #1 Natural Resources Defense Council .Interview #2 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council . California Institute for Energy Efficiency Total note: 1 selects column Rather Little Mixed/Unclear 0 0 Most 3 1 1 1 0 1 1 1 1 1 1 0 0 0 0 0 2 1 1 2 1 1 3 1 1 1 0 1 1 2 1 1 1 0 2 1 1 0 2 1 1 8 1 0 3 10 ERG Master’s Project Mark Stout 159 .Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees .Interview #1 California Large Energy Consumers Association .Interview #1 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 INDEPENDENT PRODUCERS American Wind Energy Association Independent Energy Producers LARGE ELECTRICITY CONSUMERS Agricultural Energy Consumers Association California Industrial Users California Large Energy Consumers Association . 0 0 1 0 1 1 3 9 10 ERG Master’s Project Mark Stout 160 .Interview #1 Natural Resources Defense Council .Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees .Interview #1 California Large Energy Consumers Association .Interview #1 Coalition of California Utility Employees .Interview #2 Sierra Club Union of Concerned Scientists STATE INSTITUTIONS California Energy Commission University of California.How much of what you wanted was in AB 1890? INVESTOR-OWNED ELECTRIC UTILITIES Pacific Gas & Electric San Diego Gas and Electric Southern California Edison MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association .Interview #1 California Municipal Utilities Association .

Interview #1 California Municipal Utilities Association . California Institute for Energy Efficiency Total note: 1 selects column ERG Master’s Project Mark Stout 161 .Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees .Interview #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.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 #2 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council .Interview #1 Coalition of California Utility Employees .Interview #2 INDEPENDENT PRODUCERS American Wind Energy Association Independent Energy Producers LARGE ELECTRICITY CONSUMERS Agricultural Energy Consumers Association California Industrial Users California Large Energy Consumers Association .Interview #1 California Large Energy Consumers Association .Interview #1 Natural Resources Defense Council .

Appendix E: Restructuring Stakeholder Campaign Contribution/Gift Analysis Detail Table 1: Assemblymember Jim Brulte.000 $4.995 $21.000 $495 $950 $696 $2.000 $3. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.191 $2.896 $3.000 $3.000 $7.500 $22.000 $2.495 $7.000 $1.495 $10.000 $1.000 $1.429 $498 $1.000 $2.000 $3.995 $300 $12.) California Independent Oil Marketers Association Chevron (CMA member) Mobil Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $22. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear generation) Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int.495 $1.000 $0 $0 ERG Master’s Project Mark Stout 162 .000 $500 $1.800 $1.500 $1. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS Adams Steel California Farm Bureau Federation PAC California Manufacturers Association California Mining Association PAC California Steel Industries (CLECA member) Fontana Steel Louisiana Pacific (CMA member) Mitsubishi Cement (CLECA member) National Cement (CLECA member) Riverside Cement (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.

000 $1.000 $2.995 $1.000 $8.Table 2: Assemblymember Jim Brulte.500 $1.) California Independent Oil Marketers Association California Independent Petroleum PAC Chevron (CMA member) Exxon Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $28.990 $1.000 $3.500 $1.495 $4.500 $47.995 $0 $0 ERG Master’s Project Mark Stout 163 .511 $3.000 $1.460 $200 $500 $750 $2.995 $14.500 $6.500 $800 $498 $200 $9. (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 $10.995 $2.750 $4. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $2.017 $749 $750 $3.250 $2. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades INDEPENDENT PRODUCERS CalEnergy Co.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 Int.

Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.750 $2. totaling $101. and Budapest. 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.000 $3. (geothermal) Indpependent Energy Producers OIL AND NATURAL GAS COMPANIES California Independent Petroleum PAC Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $11.250 $500 $1. Paling in comparison.500 $1. Table 3: Senator Steve Peace.000 $1. From 3/28/96 to 4/8/96.750 $750 $1. 4 ERG Master’s Project Mark Stout 164 .000 $2.1995/1996 Stakeholder Gift Information for Assemblymember Jim Brulte In 1995.000 $1. AB 1890 author Assemblyman Jim Brulte accepted no gifts from stakeholders. Sweden. by the California Foundation on the Environment and the Economy.000 $1. and Privatization” visiting London. CFEE is a “non-profit. Not to be outdone.750 $3. Conservation. Mobil treated Brulte to a $60 event in 1996. 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. as well as an event. Brulte was taken on a $7. 1996.000 $750 $0 $0 103 Asmus. Chevron treated Brulte to two meals.000 $2.

250 $750 $500 $1.500 $16. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.500 $8.815 $750 $6.500 $3.) California Independent Petroleum PAC Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $48.000 $500 $2.000 $6.250 $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.115 $18.100 $2.000 $4.250 $2.572 $1.250 $7.000 $750 $750 $750 $1. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int.072 $2.Table 4: Senator Steve Peace.600 $2.000 $300 $1.450 $7.050 $3.750 $0 $0 ERG Master’s Project Mark Stout 165 .000 $1.

Peace was treated to a $52 sports event by Mobil Oil.450 166 ELECTRIC/GAS $6. while Edison treated him to five meals and a sports event. Table 5: Senator Byron Sher. as well as chair of the Senate Energy and Utilities Committee.000 Table 6: Senator Byron Sher. SDG&E pulled on Peace’s ear over a sports event and meal totaling $89. he maintained a pretty low profile in 1995 and 1996 in terms of accepting gifts and trips. 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 $5.900 . SDG&E had Peace out to six meals. 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. In 1995.1995/1996 Stakeholder Gift Information for Senator Steve Peace Given Steve Peace’s prominence as chair of the Conference Committee on Electric Utility Restructuring. In 1996. Southern California Edison was granted a high level of access. IEP made a gift of $241 for his speech at a conference.100 $2. taking Steve to 11 meals. Peace began a practice of reimbursing all utilities for meals and outings starting with Edison in 1995.000 $5.

$2.000 locals) Southern California Pipe Trades United Assoc. and Hamrin. Brotherhood of Electrical Workers (various $9. McQuat.482 $100 $1.882 $100 $1. of Journeymen & Apprentice Underground Utility/Landscape INDEPENDENT PRODUCERS AES Pacific/SF Energy Co.100 $500 $2. (gas-fired) American Wind Energy Association Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy 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. (biomass) Edson + Modisette (lobbyist for indep.000 $100 producers.500 Int.000 $500 $1.000 $500 $500 $9. EVs) Hansen. Inc (consultants) $200 ERG Master’s Project Mark Stout 167 . (geothermal) Colmac Energy Inc.600 $13.

000 Large Energy Consumers $3.000 $1.Indpependent Energy Producers Modesto burning) SeaWest Windpower United American Energy Wadham Energy Limited Partnership (biomass) Zond Windpower DSM ENERGY SERVICE Energy Limited Partnership $1.500 COMPANIES $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 $100 $100 $500 $1.000 (tire $1.250 $100 $50 $500 $500 $250 ERG Master’s Project Mark Stout 168 .000 $1.000 $100 $1.

000 $300 $300 $22. California Institute for Energy Efficiency California Integrated Waste Management Board (biomass proponents) Nevada Community Action $1. of California.462 $100 $900 $400 $500 ERG Master’s Project Mark Stout 169 .Tosco Corp.000 $700 $4.448 $14.585 $100 $500 $2. (gasoline refining and marketing) SMALL ELECTRICITY CONSUMERS California Association ENVIRONMENTAL ADVOCATES California League of Conservation Voters Energy Foundation Environmental Defense Fund Natural Resources Defense Council Planning and Conservation League Sierra Club California Union of Concerned Scientists STATE INSTITUTIONS U.

and GE. totaling $758. totaling $2608.000 in each of Amoco.1995/1996 Stakeholder Gift Information for Senator Byron Sher In 1995.300 $500 $1. NARUC treated Sher to a two day trip to DC for another meeting. the National Association of Regulatory Utility Commissioners (NARUC) bought Sher two plane tickets for quick trips to the Steering Committee meetings of the Electric Utility Restructuring Project. Sher holds over $100. but his Statement of Economic Interest reveals large holding of oil and electricity stocks.500 $300 $0 $0 $2. Exxon. Table 7: Senator Bill Leonard. Sher received no other gifts that year from energy utility stakeholders.000 $1. In 1996.400 $750 $150 $1. Mobil. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS INDEPENDENT PRODUCERS LARGE ELECTRICITY CONSUMERS California Steel Industries (CLECA member) Riverside Cement (CLECA member) Tamco Steel (CLECA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $3.500 $0 $0 ERG Master’s Project Mark Stout 170 .

WA paid $734 for Leonard to moderate a conference session on utility deregulation. and a $75 dinner at the American Legislative Exchange Council’s annual meeting.000 $5. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.000 $1. (CLECA member) California Steel Industries (CLECA member) Mitsubishi Cement (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co. extending his stay from 12/8/96 to 12/13/96.000 $0 $0 1995/1996 Stakeholder Gift Information for Senator Bill Leonard In 1995.650 $2.500 $150 $500 $3. SDG&E bought Leonard a $125 ticket to the Pete Wilson Inaugural Gala. SCE treated Leonard to dinner and lodging for Legislative Ski Day.000 $500 $500 $4. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int.Table 8: Senator Bill Leonard.000 $2. Edison’s lobbyists got to spend a little more quality time with Leonard for their money.080 $10.000 $1. saving up for a $77 dinner with head lobbyist Bob Foster. SCE treated him to a $30 beach party and a $20 lunch with lobbyist Bob Foster.730 $2. for a paltry $20.) Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $19. Senator Leonard was courted a little more heavily by energy stakeholders in 1996.000 $2.650 $500 $1. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS California Mining Association PAC California Portland Cement Co. While the Senator was there.500 $500 $1. Edison again ERG Master’s Project Mark Stout 171 . The Pacific Rim Conference of Seattle.000 $2.

000 $750 $750 $650 $150 $500 $3. PG&E took Leonard out to a Kings game.600 $1.000 $1. including lunch with Bob Foster. They also had Leonard out for two meals in Sacramento.had Senator Leonard out for Legislative Ski Day.250 $750 $0 $0 ERG Master’s Project Mark Stout 172 . paying $44 for two meals and lodging.250 $1.000 $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.) Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $6. for the modest tab of $56.000 $1. ARCO treated Leonard to a $19 meal at a reception.750 $1.600 $750 $750 $500 $1. Table 9: Assemblymember Mickey Conroy.

500 $2. 4 ERG Master’s Project Mark Stout 173 .000 $2.000 $500 $750 $250 $500 $2.300 junket to talk with Chinese central government and provincial leaders in Beijing. 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. Shanghai. the California Foundation on the Environment and the Economy took Conroy on an 11 day.Table 10: Assemblymember Mickey Conroy.000 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Mickey Conroy In April of 1995. Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $9.600 $3. $7.000 $3. CFEE is a “non-profit. 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.050 $1.700 $500 $300 $550 $2.000 $5.600 $500 $1.000 $500 $2. and Inner Mongolia. (CLECA member) California Steel Industries (CLECA member) Louisiana Pacific (CMA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co. PG&E treated him to a basketball game with $51 tickets. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure104.700 $750 $450 $250 $250 $1. and to 104 Asmus. 1996.) California Independent Petroleum PAC Chevron (CMA member) Southern Counties Oil Co. two meals for $44.

Chevron took Conroy out for two business meals.000 in Orange & Rockland Utilities. SDG&E. After such a busy social calendar in 1995. it is surprising that no electric utility deregulation stakeholders made any gifts to Assemblymember Conroy in 1996. four rounds of “refreshments” for $30. General Electric. Pacificorp. the Assemblymember seems to have a penchant for electric utilities and nuclear power plant manufacturers. and Westinghouse Electrical. ERG Master’s Project Mark Stout 174 . Edison wined and dined the Assemblymember with four meals at $134.000 each in Edison. costing $99. $10 in candy. with investments of greater than $10.make sure Conroy kept a sweet spot in his heart for them. In terms of investment. Kansas City Power & Light. and $25 of cookies and candy. and less than 10.

750 $2.750 $2.000 $1.750 $750 $500 $500 $750 $0 $0 ERG Master’s Project Mark Stout 175 . (geothermal) Indpependent Energy Producers OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.250 $1.175 $500 $1. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS California State Pipe Trades Council PAC Int.750 $1.000 $1.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.250 $1.750 $4.000 $1.750 $1.675 $2. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.Table 11: Assemblymember Diane Martinez.

(CLECA member) California Steel Industries (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $500 $500 $500 $500 $500 $3.500 $6.750 $1.000 $500 $500 $5.000 $0 $0 ERG Master’s Project Mark Stout 176 .) UTILITY LABOR UNIONS California State Association of Electrical Workers Int. (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.500 $1.500 $500 $500 $1.500 $1.500 $1.000 $1.500 $1.000 $5. Dist.000 $4. (member of IPPs of NY) Zond Windpower LARGE ELECTRICITY CONSUMERS California Manufacturers Association California Portland Cement Co.000 $1. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.000 $500 $3.000 $7. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises MUNICIPAL ELECTRIC UTILITIES Gualco Group (lobbyist: Imperial & Modesto Irigatn.000 $500 $1.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $20.000 $1.250 $1.Table 12: Assemblymember Diane Martinez.000 $4.

208 $0 $0 $1.500 $1. The Assemblymember enjoyed no such gifts from deregulation stakeholders in 1996.467 trip to Northwestern University to discuss the deregulation of public utilities.000 $8. ERG Master’s Project Mark Stout 177 .500 $1.058 $500 $500 $1. natural gas. diesel) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.Table 13: Assemblymember Steve Kuykendall. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear plants) Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS INDEPENDENT PRODUCERS LARGE ELECTRICITY CONSUMERS Louisiana Pacific (CMA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.100 $100 $1.600 $1.) California Independent Oil Producers Chevron (CMA member) Kaiser International Corp.000 $500 $500 $1.600 $500 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Diane Martinez In 1995.000 $1.900 $3.850 $1. the Illinois Energy Association flew Martinez out for a $1. (bulk terminals) Mobil Tidelands Oil Tower Energy Group (oil.

500 $1. Sweden. and Privatization” visiting London.374 $500 $2.Table 14: Assemblymember Steve Kuykendall. However.443 $6.500 $0 $1.490 “Travel project to Europe on Electric Restructuring. From 3/28/96 to 4/8/96.) California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Mobil Texaco Tidelands Oil Tower Energy Group (oil. Kuykendall was taken on a $7. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises 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. Kuykendall’s social calendar was destined to pick up in 1996.350 $500 $1.374 $4.000 $500 $2. natural gas. diesel) Unocal (CMA member) Victory Oil Co.000 $1. ERG Master’s Project Mark Stout 178 .000 $2.250 $100 $500 $35. SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $10. Western States Petroleum Association treated Kuykendall to a reception and a dinner totaling $62.500 $1.000 $1.254 $200 $500 $4. Conservation.989 $500 $500 $0 $0 1995/1996 Kuykendall Stakeholder Gift Information for Assemblymember Steve In 1995.000 $1.000 $19. and Budapest.

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

ZEV’s and Rethinking the Environment Conference. PG&E had him out for two lunches. Kansai Electric utility spent $222 to fly Feeler to roundtable discussions at the NARUC/Kansai Electric Senior Executives Meeting in New York City. had Fessler speak at their conference in Washington. spending $1006. Fessler was flown to The National Association of Energy Service Companies for $249 to speak at their annual conference in Boca Raton.Energy Coalition flew him to Wyoming to join roundtable discussions at an Aspen Accord Working Group meeting. for $323. $7.802 junket to talk with Chinese central government and provincial leaders in Beijing. EEI is a trade association representing investor owned utilities. The Western States Coordinating Council. the California Foundation on the Environment and the Economy took Fessler on an 11 day. a utility association. the Center for Resource Management flew him to Midway. ERG Master’s Project Mark Stout 180 . The Rocky Mountain Electrical League. DC. Fessler holds over $10. The Illinois Power Company spent $427 to bring the CPUC President out to speak at the Edison Electric Institute Joint Executives Symposium. NJ to speak at the 1994 DSM Implementation Conference. spent $314 to bring him to speak at their Spring Conference. Finally. The American Enterprise Institute for Public Policy spent $120 for Fessler to make it to their Energy Policy Forum in Washington. The Cato Institute. Utah to speak at the “Utility Restructuring.000 in Ohio Edison stock. DC. Shanghai. in Fort Collins. spending $291. CO. and Inner Mongolia. for $467 airfare. Synergics Resources Corporation had Fessler out to Princeton. a utility planning association. spent $249 to fly him to their annual meeting in Las Vegas. Finally. a libertarian think-tank. The Energy Foundation brought him to Dallas and Salt Lake City for the “Utility Futures V and VII meetings. for $61. On the investment side. In April of 1995.

Knight did not report any electricity deregulation stakeholder gifts in 1994 or 1995. by the California Foundation on the Environment and the Economy. He left office on February 23. He does own more than $10. 1994/1995 Stakeholder Gift Information for Commissioner Henry Duque Duque did not report any electricity deregulation stakeholder gifts in 1994 or 1995. spending $258. Edison. Jr. and Schlumberger oilfield services stock. 1994/1995 Stakeholder Gift Information for Commissioner Josiah Neeper Knight did not report any electricity deregulation stakeholder gifts in 1994 or 1995. 1995. regulators. to meet with CEOs of the electricity industry.000 in each of Chevron. utility and General Electric stock. wholesale PoolCo model. The Edison Electric Institute spent $279 to fly the Commissioner to a conference on the results of State Competition in Boca Raton. Brussels. ERG Master’s Project Mark Stout 181 . one of CFEE’s funders. Conlon was taken on a $7.167 junket visiting London. and environmental groups to discuss the British experience with deregulation of electricity. government ministers. 1994/1995 Stakeholder Gift Information for Commissioner Norm Shumway In February of 1994.000 in each of Central & Southwest Corp. was very interested in California moving to the UK-style. and Paris. PG&E had him out to three meals for $71. Unocal. and less than $10. In 1995. 1994/1995 Stakeholder Gift Information for Commissioner Jesse Knight.000 in each of Montana Power Company and Exxon stock. the Northwest Electric Light and Power Association flew Shumway to their 3rd annual Non-Utility Generation Conference. He does own less than $10.1994/1995 Stakeholder Gift Information for Commissioner Gregory Conlon From 3/16/94 to 3/31/94.

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