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 which will be superseded to a great extent by the details of AB 1890.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

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

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

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

Qualifying Facilities were primarily cogeneration and small renewable energy electricity producers. 16. started by PURPA. recent successor to the FPC. this was the marginal cost associated with procuring new generation capacity. 10 Davis. towards more competition in electricity generation. 343. was charged with writing the rules required to implement this legislation. ERG Master’s Project Mark Stout 10 . In capacity constrained systems. PURPA aimed to set standards for state PUC ratemaking that would promote energy savings and be partial to residential consumers over industrial consumers.investment options of utilities so that each was confined in scope to an “integrated public-utility system. 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. The Federal Energy Regulatory Commission (FERC). 11 Pechman. It also created new 8 9 Pechman. Hempling. 166-167.11 Energy Policy Act of 1992 EPAct continued the Federal trend. 17. PURPA was very significant in creating a market for non-traditional generators.”910 Public Utility Regulatory Policies Act of 1978 Passed by Congress as part of President Carter’s National Energy Plan. This legislation allowed FERC to order utilities to provide transmission access at non-discriminatory rates. which is critical for wholesale competition.

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

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. the CPUC issued a staff proposal regarding electric utility deregulation known as the “Blue Book”. 55. and if successful. 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. Hoffman. industrial customers taking power at the transmission level eligible on January 1. all commercial customers eligible January 1. The Blue Book laid out an aggressive. 6. all residential consumers eligible on January 1. ERG Master’s Project Mark Stout 12 . with large. and 3) rate changes to encourage efficiency and distribution of power. sending “a shockwave through the electric industry”.supplies.17 A security analyst noted that the release of the Blue Book will: speed up the deregulation of the industry. 1999. A more definitive policy statement was 16 17 Haddad. 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. 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. 18 Mydans. 2002.18 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.”16 CPUC “Blue Book” Proposal California’s Public Utility Commission is widely viewed as a trend-setter for state PUC electric utility regulation.

1995. such as “green pricing”. “a vibrant market exists for energy efficiency services”. coupled with a lack of prior coordination with the state Legislature. 1994. Status Report. The first issue addressed open access to the transmission system 19 20 CPUC. and documentation resulting in a report back to the Governor and Legislature by January 31. ERG Master’s Project Mark Stout 13 . 1994.22 FERC MegaNOPR In March of 1995. and asserted that. 1995. 1. which had been dubbed the MegaNOPR. This process tempered the CPUC’s frenetic timetable. Blue Book. evidentiary hearings. prompted the Assembly Committee on Utilities and Commerce and the Assembly Committee on Natural Resources to hold a joint oversight hearing on May 23. “alternative frameworks based on ‘let the market decide’”. In their place. For instance. 21 CPUC. where customers voluntarily pay more to promote renewables. the CPUC proposed. where CPUC President Fessler and Commissioner Knight testified on their proposal. which requires the CPUC to engage in a series of public hearings. FERC released a dual-issue Notice of Proposed Rulemaking. 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. 1994. were concerned about the content and timetable of this proposal.21 This stakeholder response. This led to the passage of Assembly Concurrent Resolution 143.scheduled to be issued by the CPUC in August of 1994. including private and public-interest organizations.20 Many stakeholders. Blue Book. pushing back their goal for a policy decision until September of 1995.19 Since the release of the Blue Book proposal. Wagner. numerous other states have also proposed electric utility deregulation.

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

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

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

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

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

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

including residential and small commercial consumers. would be eligible for direct access January 1. chair of the House Energy and Power Subcommittee. the CPUC released its latest restructuring decision which surprised stakeholders by announcing that all customers.”39 Recent State and Federal Activity Since the signing of AB 1890 into law. 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. and 15% consumer-side incentives. As Carter and Cavanagh have noted.environment/equity agenda” which had gripped the industry since the release of the Blue Book in 1994.40 On May 6. the California PUC was on a clear course to abandon all [funding for public purpose programs] on grounds of lack of statutory authority. 1998. the CPUC and California Energy Commission (CEC) have been working towards the implementation of this legislation. 1997. 1997. It divides up this amount into four accounts that vary over four years of funding.42 This bill includes a "minimum renewable energy generation 39 40 Carter and Cavanagh. 1996 CEC. 1997 42 Weisman. “Primed for Congressional Battle” ERG Master’s Project Mark Stout 20 . “If the bill had failed. 10% emerging technologies. 1997 41 Marshall. 30% new technologies. The overall levels are: 45 % existing technologies. In March of 1997. including a prominent one authored by Representative Dan Schaefer (R-CO).41 There are currently several electric utility restructuring bills in Congress.

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

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

51 Stevenson. 84-108.intense pressure from large industrial customers. 195. 1994.51 Academics & Ideologues Neo-classical economists have argued since the 1970’s for the deregulation of the electric utility industry. 1993.”. but now had to pay higher rates. 447-475. Hoffman 55-62. Gordon. basing their arguments on welfare economics as applied to the changing electric utility landscape. 356-357. 1993. ”49 Technology The development of gas turbine generation technology has greatly reduced the scale requirements for efficient electricity generation. who in the past had enjoyed privileged status with cheap rates. 52 Gilbert. Advancements in transmission line technology now allow the efficient transmission of electricity for distances of hundreds of miles.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. greatly increasing opportunities for bulk power sales. 150. enabling increased competition.52 The “new industrial organization” espoused by these economists has served as 48 49 Davis. This reduction in scale has brought down the capital requirements of entering the electricity generation industry. “Discretionary Evolution. ERG Master’s Project Mark Stout 23 . 50 Flavin and Lenssen.. Davis..

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

either the CPUC December Decision or AB 1890. 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. 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 opposed to the nonbypassable surcharge funding mechanism adopted in AB 1890 ERG Master’s Project Mark Stout 39 .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.

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

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

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

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

The renewables players were probably asking for too much of the old world the PUC had engaged in. He also chided municipal utilities and some small consumer advocates for resisting the process and not fully participating. yet were not in the hearing for one minute.. 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. for their inability to articulate positions. In AB 1890. ...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 .. could not address the problem of a competitive market and participation. The California Municipal Utilities Association folks lacked effectiveness also.. The rate reduction bonds may not yield net present value benefits. The 10% rate reduction for small customers was final packaging to sell the bill for voters.Officeholder Staff Comments on Who Got Rolled Over. These groups could not come to a resolution. and the renewables community was perceived as not being able to make a paradigm shift.. He also touched on the un-level playing field created by a free-market ideologue Governor: The environmental and renewables communities made the Committee punt.. they had full opportunity. • A staffer from Senator Byron Sher’s office also brought up the municipal utilities. LADWP was trying to cause trouble with restructuring. The low income groups participated on paper through filed comments. . as rates were supposed to come down due to the QF cliffs anyway. They waited until late in the process to get organized. They did not want to participate.... This was very irresponsible. but did not do hall walking to the extent of other groups.. according to this CPUC staffer. The low income groups may not have the staff resources to lobby effectively. but just result in rate deferrals for 10 years.. 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. but for different reasons. • 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.

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

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

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

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

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. As a Sierra Club California legislative chair recounts on meetings between CMA.. 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 . During the Conference Committee hearings. a perusal of legislative language that was proposed during the long. agricultural consumers..” However. including IEP. 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.. roughly $660 million a year for the IOUs alone] of utility revenues for public purpose programs in the MOU came out of these discussions. and energy efficiency. TURN was one of several public interest organizations who opposed the change. Industrial Users. less than two weeks before the Bill would be reported out of committee. RD&D. CLECA.1% of IOU revenues.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. reduced funding to an average of 2. hot days of August in the 1996 Conference Committee reveals that this “consensus” funding level took a large hit on August 15. These got translated into dollars. renewables with an incremental cost estimate from the BRPU..72 At this point late in the game. The August 15 language from a coalition of powerful interests. and the Sierra Club. “We reached a consensus on. A legislative outcome related to “green” pricing for renewables provides another example of an ephemeral consensus. The 3% [it was actually a cap of 3.3% of utility revenues. funding for public purpose programs: low income. EDF.

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

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

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

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

981 $1.000 $480.675 $384.112 $3.000 $225.079 $950 $14.203.500 $263.125 $0 $4.500 $78.102 $0 $73.096 $971. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.479 $2.419 $13.075 $4.000 $62.500 $1.000 $681.745 $68.588 $500 $32. (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 $59.630 $300 N/A $0 $5.000 N/A $0 $18.101 $495 $10.000 $1.835 $1.758 $2.272 $0 $64.675 $736.239 $0 N/A $0 $89.516.149 $3.000 $562.595 $0 $21.752 $0 $51.995 $596.496 $8.500 $533.559 $0 $246.000 $634.079 $13.952 $1.374 $1.092 $3.180 $0 $209.608 $3.157 $0 $188.964 $0 $40.470 $10.416 $5.592 $846 $0 ERG Master's Project Mark Stout 54 .819 $0 $323.031.110 $34. 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.370 $648 N/A $0 $208.166 $5.S.818 $0 $65.308 $516.000 $0 $70.500 $190.163 $0 $25.405 $0 $722.153 $750 N/A $8.741 $21.181 $0 $160.1995 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear plants) Joint Electrical Industry Fund Pacific Gas & Electric/U.

519 $11.551 $12.197 $500 N/A $2.947 $500 $281.230.701 $0 $5.401 $1.000 $37. 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 $4.495 $1.596.495 $27.675 $0 $1.000 $383.723 $0 $38.492 $0 $66. (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.326 $0 $100.271 $0 $12.145 $5.000 $524.500 $0 $0 ERG Master's Project Mark Stout 55 .081 $1.1995 Lobbying Totals RMC Lonestar (CLECA member) Southwest Portland Cement Co.000 $0 $171.099 $12.600 $32.055 $0 $151.207 $5.250 $0 $30.203 $0 $30.000 $20.400 $100 $79.362.167 $500 $25.850 $1.716 $39. (gasoline refining and marketing) Tower Energy Group (oil.000 $0 $6.938 $0 $118.600 N/A $5.000 $526.000 $0 $15.003.319 $0 $10. natural gas.665 $0 $262.083 $0 $20.203 $5.291 $3. (bulk terminals) Mobil Texaco Tidelands Oil Tosco Corp.

281 $1.286 $3. and Hamrin.571 $500 N/A $200 N/A $1. (geothermal) California Cogeneration Council California Solar Energy Industry Association Cannon Energy (windpower) Colmac Energy Inc. Dist.060 $6.750 $1.500 N/A $0 $211.000 $35.819 $921. 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.) 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. McQuat.000 NA $500 $0 $2.100 $0 $500 N/A $100 $0 $500 N/A $2.862 $21. EVs) Enron Corporation (gas fired) GWF Power Systems (oil and coal-fired) Hansen. of Jrnymn & Aprt Underground Utility/Landscape Utility Workers Union of America INDEPENDENT PRODUCERS AES Pacific/SF Energy Co.500 N/A ERG Master's Project Mark Stout 56 .590 $5. (biomass) Destec (gas-fired) Edson + Modisette (lobbyist for indep.000 N/A $100 N/A $7.229 $100 N/A $1.905 $30.032 $0 $172.200 $837.717 $500 not applicable $0 $138.724 $500 not applicable $500 $57.159 $3.543 $29.454 $3.000 $85.000 $50.1996 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Electric Power Research Institute General Electric (nuclear plants) Pacific Gas & Electric/U.147 $500 $739.460 $50.S.748 $32. producers.782 $981.250 $148. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades United Assoc.605 $250 N/A $1.589 $26.450 $566.250 N/A $100 N/A $2.195 $401.500 $29.025.017 $1.000 $33.611 $1.100 $144.600 $276.750 $418. 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.882 $15. (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) $145.750 $267.917 $300 $5.000 $209.331 $0 $97. (gas-fired) American Wind Energy Association Bechtel (gas-fired) Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co.179 $0 $3.626 $0 $8.240 $0 $178.845 $452.118 $0 $144.400 $1.

000 $22.960 $2.417 $9. natural gas.250 $34.000 $76. (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.900 $1.712 $100 N/A $200 $16.573 $2.521 $14.478.500 $47. 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. (gasoline refining and marketing) Tower Energy Group (oil.296 $800 $25.780 ERG Master's Project Mark Stout 57 .000 $233.177 $300 N/A $0 $29.334 $498 $1.900 $0 $21.721 $748.761 $0 $73.643 $1.072 $918.958 $2.500 $277.016 $1.622 $67.245 $335. diesel) Unocal (CMA member) Victory Oil Co.181 $1.532 $4.521 $0 N/A $50 $87.407 $200 $61.1996 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.878 $12.050 N/A $0 $214.138 $1.650 $3.950 $3. Texaco Tidelands Oil Tosco Corp. (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.511 $1.750 $23.995 N/A $100 N/A $0 $3.000 $500 $456.137 $550 N/A $5.000 $65.689 $2.989 N/A $9.861 $1.347 $9.521 $1.705 $19.050 $949.750 $37.090 $749 $38.438 $500 N/A $0 $1.384 $2.661.925 $0 $44.209.885 $300 $207.500 $251.495 $22.636 $0 $103.800 not tracked $3.754 $4.

068 $14.000 $900 N/A $400 N/A $500 N/A ERG Master's Project Mark Stout 58 . California Institute for Energy Efficiency California Integrated Waste Management Board (biomass) Note: N/A = not available Conference Committee Total California Campaign Lobbying Expenses Contributions (Jan-Sept) $1.462 $500 $14.250 $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.066 $500 N/A $250 N/A $22.448 $424.790 $100 $14.000 $700 $117.585 $33.066 $500 $21.438 $4.378 $100 $21.462 $208.000 $15. of California.000 $2.

and small consumer groups.800 each. alternative energy producers. including oil and natural gas companies. an Edison lobbyist was added to the international travel party at the last minute. According to investigative writer Peter Asmus. were able to far outspend environmental organizations (who were usually spread thin over many issues).”80 In April of 1995. CPUC President Fessler and Commissioner Gregory Conlon were taken by CFEE on an excursion visiting London.As one would imagine. “though the CPUC had imposed a ban on communications regarding the Biennial Resource Plan Update (BRPU). 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. and Privatization” took AB 1890 author Jim Brulte and Conference Committee 79 80 Asmus. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure. CFEE is a “non-profit. and Inner Mongolia. 1996. paying up to $7. a clean power auction the CPUC repeatedly postponed upon the urging of the utility. From 3/28/96 to 4/8/96. 4 Asmus. Conservation. for $7.79 From 3/16/94 to 3/27/94. Brussels. the lobbying summary tables above. and Paris. regulators. to meet with CEOs of the electricity industry. 4 ERG Master’s Project Mark Stout 59 . 1996. and environmental groups to discuss the British experience with deregulation of electricity.167 per guest. government ministers. as well as the legislator breakdown tables and gift descriptions in Appendix E show that IOUs and large consumers. 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. Shanghai. their “Travel project to Europe on Electric Restructuring.

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

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.

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e.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. 1995 Decision? How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? Is your organization more comfortable with one policy decision over the other (i.. and why? Which stakeholder groups do you think could have been more effective in influencing the policy formulation process. CPUC vs. 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. 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 . AB 1890)? Why? Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

We also networked our position with other utilities. Munis can be divided into two groups: those that are creature of city governments. so be it. SMUD is an independent special district that can not do that. They were not camping out at the Capital. and Director of Public Affairs. but do send attorneys to represent us. we have to play things straight up. and those that are independent. If the city council needs this transfer to balance the budget.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. The thing that sets people off is that LADWP transfers $100 million a year to their general fund from their utility revenues. which does not include campaign contributions. 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. I was the point person in lining up meetings that several of us would attend. LADWP is a creature of LA. putting in 1/3 to 2/3 of my time. As a public agency. causing concern with other munis. Assistant General Manager. We do not have a lobbyist at the CPUC. more at stake. 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. including through the CMUA. We met with legislative staff and members. there were three other people with direct contacts: SMUD’s General Manager. Comments on municipal utilities and taxation: LADWP [Los Angeles Department of Water and Power. 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 . In addition to myself.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

the CPUC deregulation process was thrown open to a much wider spectrum of public input than initially envisioned by the public utility commissioners. One interesting outcome of the meeting with President Fessler was that he started to lobby Jane and Nancy to support his position. resulting in over 2.000 faxes to the CPUC demanding that the environment not get forgotten in the policy formulation process. By helping to get Assembly Concurrent Resolution No. 143 adopted. which Jane believes was a response to the effectiveness of UCS’s outsider strategy to generate public support for the RPS.000 environmentalists in California. To compliment this public participation strategy. as well as staff people for Commissioners Knight and Conlon. UCS volunteers and staff were active at over a number of 1996 Earth Day events throughout ERG Master’s Project Mark Stout 136 . as well as generating a large number of letters to the CPUC. UCS took part in a mailing to 60.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. as well as meetings arranged jointly by Jane and AWEA’s Nancy Rader to lobby for the Renewables Portfolio Standard with then-current CPUC President Fessler. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? UCS made use of a similar outsider/insider strategy to influence the legislative outcome. Jane thought this amounted to a level of public pressure that was outside of the usual institutional experience at the CPUC. UCS then planned an outsider strategy that included turning out large numbers of supporters at public hearings. asking them to respond to the CPUC through a Western Union automated fax number. UCS’s insider approach was composed of elements such as filed comments and full panel hearing testimony by UCS senior energy analyst Donald Aitken.

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

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

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

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

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

stating that their intent was that the PUC retain authority for energy efficiency funding. Neeper did after the December. most public interest RD&D money was allocated to the CEC: $61. There is an agreement that the PUC could continue funding after 4 years. 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. Fessler attended one earlier. not end this authority after four years. CPUC vs. Duque was very ERG Master’s Project Mark Stout 142 . The funding for public interest RD&D will be reviewed after three years. ‘97 Decision on public purpose programs. and this comes through in our briefings. Is your organization more comfortable with one policy decision over the other (i. In the February 14. More money could have been spent on public interest RD&D. Steve Peace and Byron Sher recently sent a letter to the PUC.e. We have good people involved in research. realizing the dollars available for public purpose programs were limited.8 million per year. very committed. briefings to the IOUs were a standard part of the communication. Conlon attended a briefing a few years back. ‘95 decision. Also. AB 1890)? Why? I would see them as an appropriate sequence of decisions. but it was a reasonable outcome. compared to just 0.7 per year to the utilities. the Legislature or PUC could modify. or over time? I think so.How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? The University supported AB 1890.. working well together. we did not change our stance. Whether or not the Legislature intended this was a point of contention. Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings.

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

the renewables community cam back in. “Do people have to fail intelligence tests to run a muni?” Anonymous Comments #2: AB 1890 funding levels for Public Interest RD&D The initial funding levels being discussed for public interest RD&D were very low. pre-Blue Book. current levels for moving to a future restructured market. University of California representatives and I advocated for higher. historic levels [combined SCE. 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. The municipal utilities angered Peace so much that he asked. at one point Steve Peace threw all of the renewables community out of the room to resolve an issue. but they were too busy negotiating other aspects of AB 1890 to followup on my requests for further discussion of RD&D. SDG&E and PG&E RD&D funding fell from over $120 million in 1994 down to just over $60 million in 1995102]. For example. After seven hours of negotiation. They proposed to me funding at current RD&D budget levels.Anonymous Stakeholder Comments Anonymous Comments #1: Parties who could have improved their performance The renewables and municipal utilities were very poorly represented in hearings. The renewables could have fared much better if they stuck together as a coalition. 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. After they finally recognized the problem ERG Master’s Project Mark Stout 144 . They probably thought that this funding level included regulated transmission and distribution RD&D. The IOUs wanted to use post-Blue Book.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

) California Independent Oil Marketers Association Chevron (CMA member) Mobil Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $22.000 $500 $1.995 $300 $12.896 $3.800 $1.000 $2. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear generation) Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS Adams Steel California Farm Bureau Federation PAC California Manufacturers Association California Mining Association PAC California Steel Industries (CLECA member) Fontana Steel Louisiana Pacific (CMA member) Mitsubishi Cement (CLECA member) National Cement (CLECA member) Riverside Cement (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.429 $498 $1.000 $1.500 $22.000 $495 $950 $696 $2.000 $3.000 $1.000 $3.000 $4.Appendix E: Restructuring Stakeholder Campaign Contribution/Gift Analysis Detail Table 1: Assemblymember Jim Brulte.500 $1.191 $2.000 $1.495 $1.495 $7.995 $21.495 $10. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.000 $3.000 $0 $0 ERG Master’s Project Mark Stout 162 .000 $7.000 $2.

995 $0 $0 ERG Master’s Project Mark Stout 163 .995 $14.000 $1.000 $10.495 $4. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $3.) California Independent Oil Marketers Association California Independent Petroleum PAC Chevron (CMA member) Exxon Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $28.500 $6. 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.750 $4.990 $1.995 $1.500 $1.000 $2.000 $2.460 $200 $500 $750 $2.500 $47.000 $1.995 $2.250 $2.000 $8.017 $749 $750 $3.Table 2: Assemblymember Jim Brulte.511 $3.000 $1. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS Adams Steel California Manufacturers Association California Mining Association PAC California Steel Industries (CLECA member) Fontana Steel Mitsubishi Cement (CLECA member) National Cement (CLECA member) Riverside Cement (CLECA member) Southwest Portland Cement Co. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades INDEPENDENT PRODUCERS CalEnergy Co.500 $1.500 $800 $498 $200 $9.

000 $2.000 $2. Table 3: Senator Steve Peace. Not to be outdone. and Budapest. Mobil treated Brulte to a $60 event in 1996.000 $1.000 $1. AB 1890 author Assemblyman Jim Brulte accepted no gifts from stakeholders. and Privatization” visiting London. From 3/28/96 to 4/8/96.750 $3. by the California Foundation on the Environment and the Economy. Brulte was taken on a $7.500 $1. Chevron treated Brulte to two meals. CFEE is a “non-profit.750 $750 $1.1995/1996 Stakeholder Gift Information for Assemblymember Jim Brulte In 1995. 4 ERG Master’s Project Mark Stout 164 . Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.000 $1.490 “Travel project to Europe on Electric Restructuring.750 $2. (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. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int.000 $3. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure103. 1996. Paling in comparison. Conservation.250 $500 $1. totaling $101. Sweden.000 $750 $0 $0 103 Asmus. as well as an event.

500 $16.250 $7.250 $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.750 $0 $0 ERG Master’s Project Mark Stout 165 .000 $6.100 $2.Table 4: Senator Steve Peace. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.) California Independent Petroleum PAC Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $48.815 $750 $6.000 $1.050 $3. (geothermal) California Solar Energy Industry Association Cannon Energy (windpower) Destec (gas-fired) Independent Energy Producers Pacific Lumber Company (solid fuel biomass) SeaWest Windpower Zond Windpower DSM ENERGY SERVICE COMPANIES (ESCOS) SESCO (energy services) LARGE ELECTRICITY CONSUMERS California Manufacturers Association California Retailers Association California Steel Industries (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $750 $750 $750 $1.572 $1.000 $4.450 $7.500 $3.000 $300 $1.250 $2.250 $750 $500 $1.000 $500 $2.500 $8.072 $2.600 $2.115 $18.

100 $2. as well as chair of the Senate Energy and Utilities Committee.450 166 ELECTRIC/GAS $6. IEP made a gift of $241 for his speech at a conference. he maintained a pretty low profile in 1995 and 1996 in terms of accepting gifts and trips. while Edison treated him to five meals and a sports event. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES Southern California Edison/Edison International UTILITY LABOR UNIONS California State Pipe Trades Council PAC INDEPENDENT PRODUCERS Indpependent Energy Producers LARGE ELECTRICITY CONSUMERS SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES California League of Conservation Voters $500 $500 $500 $500 $500 $500 $0 $0 $5. SDG&E had Peace out to six meals.1995/1996 Stakeholder Gift Information for Senator Steve Peace Given Steve Peace’s prominence as chair of the Conference Committee on Electric Utility Restructuring.000 $5. Peace was treated to a $52 sports event by Mobil Oil. Southern California Edison was granted a high level of access. Peace began a practice of reimbursing all utilities for meals and outings starting with Edison in 1995. SDG&E pulled on Peace’s ear over a sports event and meal totaling $89.000 Table 6: Senator Byron Sher. taking Steve to 11 meals. In 1995. In 1996.900 . Table 5: Senator Byron Sher. 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.

EVs) Hansen. and Hamrin.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. $2.000 $500 $1.882 $100 $1. Inc (consultants) $200 ERG Master’s Project Mark Stout 167 .000 locals) Southern California Pipe Trades United Assoc. McQuat. (geothermal) Colmac Energy Inc. Brotherhood of Electrical Workers (various $9.100 $500 $2.500 Int.482 $100 $1.000 $100 producers. (biomass) Edson + Modisette (lobbyist for indep.600 $13.000 $500 $500 $9. (gas-fired) American Wind Energy Association Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co. of Journeymen & Apprentice Underground Utility/Landscape INDEPENDENT PRODUCERS AES Pacific/SF Energy Co.

500 COMPANIES $1.000 Large Energy Consumers $3.000 $100 $100 $500 $1.000 $1.000 $100 $1.250 $100 $50 $500 $500 $250 ERG Master’s Project Mark Stout 168 .Indpependent Energy Producers Modesto burning) SeaWest Windpower United American Energy Wadham Energy Limited Partnership (biomass) Zond Windpower DSM ENERGY SERVICE Energy Limited Partnership $1.000 (tire $1.250 (ESCOS) Appliance Recycling Centers of America Onsite Energy (energy service company) Preferred Energy Services (energy service company) LARGE ELECTRICITY CONSUMERS Adams Steel California Association California Retailers Association California Steel Industries (CLECA member) Louisiana Pacific (CMA member) Schnitzer Steel Industries (CLECA member) OIL AND NATURAL GAS COMPANIES $1.000 $1.

California Institute for Energy Efficiency California Integrated Waste Management Board (biomass proponents) Nevada Community Action $1.000 $300 $300 $22. (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.448 $14.Tosco Corp.000 $700 $4.585 $100 $500 $2.462 $100 $900 $400 $500 ERG Master’s Project Mark Stout 169 . of California.

Exxon.500 $0 $0 ERG Master’s Project Mark Stout 170 . totaling $2608. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS INDEPENDENT PRODUCERS LARGE ELECTRICITY CONSUMERS California Steel Industries (CLECA member) Riverside Cement (CLECA member) Tamco Steel (CLECA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $3. Sher received no other gifts that year from energy utility stakeholders.400 $750 $150 $1.000 $1. Mobil.500 $300 $0 $0 $2. totaling $758. 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.1995/1996 Stakeholder Gift Information for Senator Byron Sher In 1995.000 in each of Amoco. In 1996.300 $500 $1. but his Statement of Economic Interest reveals large holding of oil and electricity stocks. Sher holds over $100. Table 7: Senator Bill Leonard. and GE. NARUC treated Sher to a two day trip to DC for another meeting.

saving up for a $77 dinner with head lobbyist Bob Foster.500 $150 $500 $3. 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. While the Senator was there. SCE treated him to a $30 beach party and a $20 lunch with lobbyist Bob Foster. extending his stay from 12/8/96 to 12/13/96.000 $2.500 $500 $1. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co. Senator Leonard was courted a little more heavily by energy stakeholders in 1996. WA paid $734 for Leonard to moderate a conference session on utility deregulation.000 $1. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS California Mining Association PAC California Portland Cement Co.000 $1. and a $75 dinner at the American Legislative Exchange Council’s annual meeting.000 $2. SCE treated Leonard to dinner and lodging for Legislative Ski Day.080 $10.650 $2.000 $2.) Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $19.650 $500 $1. Edison again ERG Master’s Project Mark Stout 171 . Edison’s lobbyists got to spend a little more quality time with Leonard for their money.730 $2.000 $5. for a paltry $20.000 $0 $0 1995/1996 Stakeholder Gift Information for Senator Bill Leonard In 1995. SDG&E bought Leonard a $125 ticket to the Pete Wilson Inaugural Gala. (CLECA member) California Steel Industries (CLECA member) Mitsubishi Cement (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.Table 8: Senator Bill Leonard.000 $500 $500 $4. The Pacific Rim Conference of Seattle.

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. PG&E took Leonard out to a Kings game. They also had Leonard out for two meals in Sacramento.) Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $6.250 $750 $0 $0 ERG Master’s Project Mark Stout 172 .250 $1.000 $1.000 $750 $750 $650 $150 $500 $3.750 $1.600 $1.600 $750 $750 $500 $1.000 $1. including lunch with Bob Foster.had Senator Leonard out for Legislative Ski Day. Table 9: Assemblymember Mickey Conroy. ARCO treated Leonard to a $19 meal at a reception. paying $44 for two meals and lodging.000 $1. for the modest tab of $56.

000 $2. two meals for $44. and to 104 Asmus.300 junket to talk with Chinese central government and provincial leaders in Beijing.000 $5.700 $500 $300 $550 $2. the California Foundation on the Environment and the Economy took Conroy on an 11 day. CFEE is a “non-profit. 4 ERG Master’s Project Mark Stout 173 .000 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Mickey Conroy In April of 1995. and Inner Mongolia.000 $500 $750 $250 $500 $2.Table 10: Assemblymember Mickey Conroy.600 $3.500 $2. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure104. 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. PG&E treated him to a basketball game with $51 tickets.600 $500 $1. $7. 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.000 $3. Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $9. 1996.050 $1. (CLECA member) California Steel Industries (CLECA member) Louisiana Pacific (CMA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co. Shanghai.000 $500 $2.) California Independent Petroleum PAC Chevron (CMA member) Southern Counties Oil Co.700 $750 $450 $250 $250 $1.

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

750 $2.675 $2.750 $2. 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. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.000 $1.175 $500 $1.750 $1. (geothermal) Indpependent Energy Producers OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.750 $4.250 $1.000 $1.750 $750 $500 $500 $750 $0 $0 ERG Master’s Project Mark Stout 175 .000 $1.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.250 $1.750 $1.Table 11: Assemblymember Diane Martinez.

500 $1. (CLECA member) California Steel Industries (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $7.000 $500 $3. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.000 $1.000 $5.000 $0 $0 ERG Master’s Project Mark Stout 176 .Table 12: Assemblymember Diane Martinez.000 $4.500 $1. (geothermal) Destec (gas-fired) Enron Capital & Trade (gas-fired) GWF Power Systems (oil and coal-fired) Pacific Lumber Company (solid fuel biomass) Sithe Energies Co.500 $1.250 $1.000 $1.500 $1.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $20. (member of IPPs of NY) Zond Windpower LARGE ELECTRICITY CONSUMERS California Manufacturers Association California Portland Cement Co.) UTILITY LABOR UNIONS California State Association of Electrical Workers Int. 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 $500 $5.500 $6.750 $1.000 $4. Dist.500 $500 $500 $1.000 $1.000 $500 $1.000 $500 $500 $500 $500 $500 $3.

) California Independent Oil Producers Chevron (CMA member) Kaiser International Corp.000 $500 $500 $1.600 $1.500 $1. The Assemblymember enjoyed no such gifts from deregulation stakeholders in 1996.850 $1. (bulk terminals) Mobil Tidelands Oil Tower Energy Group (oil.100 $100 $1.000 $1.467 trip to Northwestern University to discuss the deregulation of public utilities. 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.Table 13: Assemblymember Steve Kuykendall. diesel) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7. natural gas.000 $8.600 $500 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Diane Martinez In 1995. the Illinois Energy Association flew Martinez out for a $1.500 $1.208 $0 $0 $1.900 $3. ERG Master’s Project Mark Stout 177 .058 $500 $500 $1.

From 3/28/96 to 4/8/96.254 $200 $500 $4.000 $500 $2. diesel) Unocal (CMA member) Victory Oil Co. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS 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.989 $500 $500 $0 $0 1995/1996 Kuykendall Stakeholder Gift Information for Assemblymember Steve In 1995. Western States Petroleum Association treated Kuykendall to a reception and a dinner totaling $62.) California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Mobil Texaco Tidelands Oil Tower Energy Group (oil.000 $1.490 “Travel project to Europe on Electric Restructuring.000 $1.500 $1. ERG Master’s Project Mark Stout 178 . Kuykendall’s social calendar was destined to pick up in 1996.000 $1. and Budapest.250 $100 $500 $35. natural gas.374 $4.500 $1. Conservation.350 $500 $1. Kuykendall was taken on a $7.443 $6. and Privatization” visiting London.374 $500 $2.500 $0 $1.000 $19. SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $10.Table 14: Assemblymember Steve Kuykendall. Sweden. However.000 $2.

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

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

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

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