Energy and Resources Group Master’s Project

Mark Stout 5/25/1997

Comparative Power Analysis of the California Electric Utility Industry Deregulation Process

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

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

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

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

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1995 3 Flavin and Lenssen. 1995 Electric Restructuring Decision. which will be superseded to a great extent by the details of AB 1890.4 Given the stakes involved with this industry. a product with well documented environmental impacts including local air pollution.Introduction On September 23. 1996. there will probably be significant winners and losers as a result of this legislation. 1996 California Energy Commission.edf. selling 250 billion kWh of electricity per year2. and why. 1 2 CPUC RD&D Working Group.S. Various stakeholder groups. fossil fuel-based electricity generation is currently the largest source of greenhouse gas emissions and the largest source of air pollution in the U. acid rain and climate change.html ERG Master’s Project Mark Stout 4 . representing a spectrum of private and public interests attempted to influence both the CPUC and legislative processes. with varying success. This bill is an important milestone in an ongoing process towards electric utility deregulation in California. 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. 1995 Decision with the California legislative process resulting in AB 1890. California electric utilities have a combined annual revenue of roughly $23 billion dollars1. which sets in motion a process of electric utility deregulation beginning in 1998. 1994 4 WWW page: http://www. contrasting the results of CPUC process resulting in their December. This paper develops a comparison of which stakeholder groups got what they wanted. Governor Pete Wilson signed into law California Assembly Bill 1890 (AB 1890).org/programs/Energy/green_power/a_better.3 According to the Environmental Defense Fund.

Objectives
• Evaluate which stakeholder groups got what they wanted: Each stakeholder group influencing the process pursued policy outcomes that they felt were in their self-interest. This paper determines which groups had their requests granted, and which had their requests ignored, looking at both the language of AB 1890, as well as the CPUC December, 1995 decision. Groups that fared better in one arena than the other are highlighted. Determine why or why not a stakeholder group was successful in getting what they wanted out of each policy process: In many cases, interest groups were able to influence outcomes in the legislative and/or CPUC forums through well reasoned comment filings, direct lobbying, campaign contributions, as well as other avenues. This paper explores what mechanisms the different interest groups used to influence these policy outcomes, contrasting differences in techniques applied between the Legislature and CPUC, focusing on whether each decision making body or individual had particular avenues that were most effective.

Methodology
In order to answer the questions of which stakeholder groups got what they wanted and why, I based my research on an analysis of three categories of data: 1) background utility regulation literature, 2) semi-structured interviews with stakeholders as well as CPUC and legislative staff, and 3) archival analysis of CPUC filings, legislative language and videos, and state officeholder filings. Rather than approaching the data with a hypothesis to verify, I compare and cluster the data to allow patterns to flow out that can then generate theories. I compare the CPUC and legislative policy processes, determining similarities and differences in how each party fared in each forum, as well as why each party fared as they did. This data-driven approach to the generation of theory is based on the work of Glaser and Strauss, who contrast the use of data to

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generate grounded theory with the use of data to verify logico-deductive theory.5 Below I describe the use of each of these data types. Background literature on electric utility regulation is used to provide a historical context for California’s electric utility deregulation, which is presented in the next two sections of this report, History of Electric Utility Industry Regulation and Factors Behind the Drive for Deregulation. Semi-structured interviews were conducted with 26 representatives of different stakeholder organizations. The semi-structured format allows flexibility in altering the flow of the interview, following up on interesting points as they arise. I selected an initial set of organizations to contact, trying to cover as wide a spectrum of stakeholder groups as possible, based on my experience representing a stakeholder organization on the issue of electric utility deregulation in the CPUC and legislative arenas. Most interviews were conducted in person, while several where over the phone. As I conducted interviews, subjects referred me to additional representatives to contact, both in their organizations as well as in others. An interview guide was used for

recording notes, which were typed up later. Questions were developed for the interview guide to determine for each organization what outcomes were sought, what outcomes were obtained in each of the policy decisions, and what methods and strategies were used to influence each policy decision. A list of questions for the semi-structured stakeholder interviews is included in

Appendix A. A full transcript of these interviews is included in Appendix B. These interview subjects are clustered into the following categories for analysis: investor-owned electric utilities, municipal electric utilities, utility labor unions, independent producers, large electricity consumers,

5

Glaser and Strauss, 1967, Glaser, 1978.

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small electricity consumers, environmental advocates, and state institutions. The organizations represented by each interview subject are listed, by category, in the Table of Contents for Appendix B. Semi-structured interviews were conducted with two staff of the CPUC and three staff of members of the legislative Conference Committee on Electric Industry Restructuring. An

interview guide was used, with questions developed to determine which stakeholder organizations were perceived by the staff as being most effective in influencing the respective policy outcome, and why; which stakeholder organizations were perceived as being able to set the terms of the debate, and why; as well as which stakeholder organizations were perceived as least effective in influencing that policy outcome, and why. A list of questions for the semi-structured officeholder staff interviews is included in Appendix A. A full transcript of these interviews is included in Appendix C. Finally, an archival analysis was performed on the CPUC formal filings, Fair Political Practices Commission records, Secretary of State Political Reform Division records, proposed and final legislative language, as well as legislative conference committee videos. The CPUC filings can be used to cross-check what each major interested party had originally requested from the process, tracking how that may change over time, as well as to determine policy outcomes from the CPUC. The California Fair Political Practices Commission archives an annual Statement of Economic Interest for each state office holder. The EIS forms for the CPUC Commissioners and Conference Committee members were examined to determine which organizations used trips, events, meals, and other gifts to gain access to decision makers. The California Secretary of State Political Reform Division keeps Officeholder, Candidate, and Controlled Committee Campaign Statements on file for each elected state officeholder and candidate. These Statements were ERG Master’s Project Mark Stout 7

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

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

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

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

industrial customers taking power at the transmission level eligible on January 1. These generation companies would then compete with Independent Power Producers (IPPs) to provide power to a central electricity grid operator based on a combination of pool-based wholesale competition as well as direct contracts with individual customers. 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. 1999. ERG Master’s Project Mark Stout 12 .supplies. and if successful. 6. 2002. customer class-staged schedule for direct access implementation. the CPUC issued a staff proposal regarding electric utility deregulation known as the “Blue Book”. Hoffman. 1996. all residential consumers eligible on January 1. especially since the California regulators have been considered in the past to be one of the leading regulatory commissions and many states have followed their recommendations. The Blue Book laid out an aggressive. 55. In April of 1994.18 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. and 3) rate changes to encourage efficiency and distribution of power. sending “a shockwave through the electric industry”.17 A security analyst noted that the release of the Blue Book will: speed up the deregulation of the industry. with large. all commercial customers eligible January 1.”16 CPUC “Blue Book” Proposal California’s Public Utility Commission is widely viewed as a trend-setter for state PUC electric utility regulation. 2) providing cost recovery for energy efficiency programs that are at least as profitable as supply side measures. A more definitive policy statement was 16 17 Haddad.

1. FERC released a dual-issue Notice of Proposed Rulemaking. Blue Book.22 FERC MegaNOPR In March of 1995. where customers voluntarily pay more to promote renewables. For instance. the CPUC proposed. 1994.20 Many stakeholders.scheduled to be issued by the CPUC in August of 1994. ERG Master’s Project Mark Stout 13 . prompted the Assembly Committee on Utilities and Commerce and the Assembly Committee on Natural Resources to hold a joint oversight hearing on May 23. and asserted that. including private and public-interest organizations. The first issue addressed open access to the transmission system 19 20 CPUC. In their place. 1995. were concerned about the content and timetable of this proposal. Wagner. which had been dubbed the MegaNOPR. “a vibrant market exists for energy efficiency services”. This led to the passage of Assembly Concurrent Resolution 143. Status Report. numerous other states have also proposed electric utility deregulation. pushing back their goal for a policy decision until September of 1995. 1994. 1995.19 Since the release of the Blue Book proposal. which requires the CPUC to engage in a series of public hearings. such as “green pricing”. This process tempered the CPUC’s frenetic timetable. 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. and documentation resulting in a report back to the Governor and Legislature by January 31. where CPUC President Fessler and Commissioner Knight testified on their proposal. 21 CPUC. Blue Book. evidentiary hearings. coupled with a lack of prior coordination with the state Legislature. “alternative frameworks based on ‘let the market decide’”.21 This stakeholder response. 1994.

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

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

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

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

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

1996. An argument can be made that the final legislation will result in lower funding for public purpose programs. but due to the Decision’s lack of clarity about support levels. 1996 38 Asmus. “roll over renewables” and “roll over enviros. to ensure the maintenance and growth of this renewables base37. 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. than would have occurred under the CPUC’s December 1995 vision. Weeks before the passage of AB 1890. is in the public interest since it moves California utilities away from the “paralysis and backsliding on our 35 36 Borenstein. this is difficult to say. said that the Legislature was going to. From some perspectives. 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 . 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. with a mix of shortcomings and unexpected benefits in the legislation. renewable energy concerns faired poorly in AB 1890. as well as the loss of a strong policy mechanism. endorsed in the CPUC Decision. AB 1890 author Jim Brulte. including renewable energy and energy efficiency.substantial market power exists among California electric utilities35. 1996 37 Rader. 1995 Rader. AB 1890’s questionable protection against utility market power. ERG Master’s Project Mark Stout 19 .”38 Some public interest advocates would argue that moving ahead with the deregulation process. along with a guaranteed 100% cost recovery for uneconomic utility assets. indicate that electric utility shareholders faired better in the negotiations than small consumers 36. in a speech before the California Manufacturers Association.

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

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

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

intense pressure from large industrial customers.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. ERG Master’s Project Mark Stout 23 . 356-357. enabling increased competition. 447-475. Gordon. 1993. 1994.. Advancements in transmission line technology now allow the efficient transmission of electricity for distances of hundreds of miles. 1993. but now had to pay higher rates.52 The “new industrial organization” espoused by these economists has served as 48 49 Davis.51 Academics & Ideologues Neo-classical economists have argued since the 1970’s for the deregulation of the electric utility industry. 150. Hoffman 55-62. ”49 Technology The development of gas turbine generation technology has greatly reduced the scale requirements for efficient electricity generation. 52 Gilbert. “Discretionary Evolution. 84-108. basing their arguments on welfare economics as applied to the changing electric utility landscape. Davis. greatly increasing opportunities for bulk power sales. This reduction in scale has brought down the capital requirements of entering the electricity generation industry. 50 Flavin and Lenssen. 51 Stevenson.”.. who in the past had enjoyed privileged status with cheap rates. 195.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

It is 0 1 2 3 4 5 clear from the interview transcripts Figure 5: What Policy Outcome Does Your Organization Prefer? No preference / Unclear CPUC December Decision that those few organizations that stated a preference for the December Decision did so based on their support Portfolio selected for the Renewables that was Standard by the Commissioners as a renewables AB 1890 policy. either the CPUC December Decision or AB 1890. most organizations preferred the INDEPENDENT PRODUCERS SMALL ELECTRICITY CONSUMERS LARGE ELECTRICITY CONSUMERS Rather Little Mixed/Unclear Most language of AB 1890. Figure 6 shows that the only organizations interviewed that prefer the December Decision are among the environmental and UTILITY LABOR UNIONS MUNICIPAL ELECTRIC UTILITIES INVESTOR-OWNED ELECTRIC UTILITIES independent power communities. As Figures 5 indicates.Figure 4: How much of what your organization wanted was in AB 1890? One of the interview questions asked which policy outcome was STATE INSTITUTIONS ENVIRONMENTAL ADVOCATES preferred by the subject’s organization. as opposed to the nonbypassable surcharge funding mechanism adopted in AB 1890 ERG Master’s Project Mark Stout 39 .

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

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

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

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

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

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

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

NRDC had no media strategy.” • Ralph Cavanagh has served as a lightning rod for praise and criticism of the environmental community’s focus on an insider strategy.70 [also see numerous comments in interview transcripts] An American Wind Energy Association representative was disheartened that Cavanagh would not pull NRDC’s endorsement for AB 1890. 1997. It was strong going in and going out of the process. largely because no public interest group was willing to oppose the bill. NRDC’s relationship with the IOUs was important. and the Sacramento Bee focusing on public purpose programs. AWEA endorsed the bill reported out of the conference committee. but relied on their name instead. the San Francisco Chronicle. “NRDC did press work through editorial boards including the San Jose Mercury News. it did become clear that NRDC’s strategy was based on coalitions of insiders. Critical stakeholders who could have derailed did not. “wanted a win. “Past EDF’s filing comments. If environmental groups collectively walked. San Francisco Examiner.• A senior analyst for the Environmental Defense Fund comments on their participation in the CPUC process. We were in constant contact. didn’t want to ruffle any strategies. The environmental groups and consumer groups such as TURN worked well together. “Environmentalist Defends His Stance” ERG Master’s Project Mark Stout 47 .” Later in my interview with Ralph. In the end. there was not enough activity.” 70 Weisman. not turning it into a media tank battle. we could have killed it. We were on separate tracks with industrial customers to ensure no cost shifting occurred. not grassroots activists: “It was a consensus-based process. made no attempt to build clout.” • Cavanagh offers a different perspective on NRDC’s substantial media work. one on one. because he.

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

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

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

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

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

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

203.952 $1.308 $516.981 $1.102 $0 $73.000 $634.675 $736.608 $3.675 $384.419 $13.819 $0 $323.031.000 $562.272 $0 $64.180 $0 $209.166 $5.079 $13.163 $0 $25.500 $263.000 $480.479 $2.S.592 $846 $0 ERG Master's Project Mark Stout 54 .075 $4.416 $5.181 $0 $160.157 $0 $188. (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 $59.500 $78.125 $0 $4.835 $1.752 $0 $51.741 $21.370 $648 N/A $0 $208.559 $0 $246.096 $971.1995 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear plants) Joint Electrical Industry Fund Pacific Gas & Electric/U.000 N/A $0 $18.588 $500 $32.112 $3.092 $3.000 $0 $70.758 $2.000 $681.516.818 $0 $65. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.101 $495 $10. 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.110 $34.500 $190.374 $1.000 $1.239 $0 N/A $0 $89.470 $10.964 $0 $40.153 $750 N/A $8.500 $1.000 $62.000 $225.149 $3.745 $68.405 $0 $722.079 $950 $14.995 $596.496 $8.630 $300 N/A $0 $5.595 $0 $21.500 $533.

519 $11.596.230.675 $0 $1.000 $0 $15.000 $37.083 $0 $20.000 $526.600 $32.850 $1.1995 Lobbying Totals RMC Lonestar (CLECA member) Southwest Portland Cement Co.203 $5. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO California Independent Oil Marketers Association California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Exxon Kaiser International Corp.003.203 $0 $30.938 $0 $118.326 $0 $100.319 $0 $10.271 $0 $12.723 $0 $38.947 $500 $281.000 $0 $6. (gasoline refining and marketing) Tower Energy Group (oil.000 $20.167 $500 $25.145 $5.492 $0 $66.291 $3.099 $12.000 $383. (bulk terminals) Mobil Texaco Tidelands Oil Tosco Corp.000 $0 $171.701 $0 $5. natural gas.081 $1.207 $5.000 $524.600 N/A $5.551 $12.250 $0 $30.197 $500 N/A $2.500 $0 $0 ERG Master's Project Mark Stout 55 .495 $27.400 $100 $79. 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 $4.401 $1.055 $0 $151.362.716 $39.495 $1.665 $0 $262.

717 $500 not applicable $0 $138.750 $267.626 $0 $8.060 $6.571 $500 N/A $200 N/A $1.025.286 $3.S.782 $981. of Jrnymn & Aprt Underground Utility/Landscape Utility Workers Union of America INDEPENDENT PRODUCERS AES Pacific/SF Energy Co.000 $85.032 $0 $172. (biomass) Destec (gas-fired) Edson + Modisette (lobbyist for indep.605 $250 N/A $1. (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) $145.905 $30. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades United Assoc.000 $35.500 N/A $0 $211.400 $1.229 $100 N/A $1.281 $1.000 N/A $100 N/A $7.195 $401.240 $0 $178.845 $452.118 $0 $144.100 $0 $500 N/A $100 $0 $500 N/A $2.331 $0 $97.750 $418. producers. 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.179 $0 $3. Generating Company San Diego Gas and Electric/Enova Southern California Edison/Mission Energy/Edison International Southern California Gas/Pacific Enterprises MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association Gualco Group (lobbyist: Imperial & Modesto Irigatn.748 $32.460 $50. (gas-fired) American Wind Energy Association Bechtel (gas-fired) Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co.000 $50.100 $144.454 $3.) 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.589 $26.450 $566.862 $21.250 $148.724 $500 not applicable $500 $57.017 $1. EVs) Enron Corporation (gas fired) GWF Power Systems (oil and coal-fired) Hansen.000 $33.250 N/A $100 N/A $2.159 $3.611 $1.1996 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Electric Power Research Institute General Electric (nuclear plants) Pacific Gas & Electric/U.590 $5. Dist.543 $29. (geothermal) California Cogeneration Council California Solar Energy Industry Association Cannon Energy (windpower) Colmac Energy Inc.000 $209.882 $15.147 $500 $739.500 $29.000 NA $500 $0 $2. and Hamrin. McQuat.200 $837.819 $921.600 $276.917 $300 $5.500 N/A ERG Master's Project Mark Stout 56 .750 $1.

072 $918.573 $2.177 $300 N/A $0 $29.661.347 $9.650 $3.900 $0 $21. Texaco Tidelands Oil Tosco Corp.500 $277.511 $1. natural gas.384 $2.138 $1. (gasoline refining and marketing) Tower Energy Group (oil.800 not tracked $3.521 $1.050 $949.1996 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.750 $37.754 $4.705 $19.495 $22.885 $300 $207.643 $1.958 $2.050 N/A $0 $214.407 $200 $61.721 $748.500 $47.989 N/A $9.000 $233. 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) $41.000 $500 $456.636 $0 $103.861 $1.334 $498 $1.995 N/A $100 N/A $0 $3.209.780 ERG Master's Project Mark Stout 57 .925 $0 $44.250 $34.761 $0 $73. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO California Independent Oil Marketers Association California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Exxon Mobil Southern Counties Oil Co.521 $14.000 $65.016 $1. (CLECA member) California Retailers Association California Steel Industries (CLECA member) Californians for Competitive Electricity Fontana Steel Kaiser Aluminum Kaiser Cement Corporation Louisiana Pacific (CMA member) Mitsubishi Cement (CLECA member) National Cement (CLECA member) Riverside Cement (CLECA member) RMC Lonestar (CLECA member) Schnitzer Steel Industries (CLECA member) Southwest Portland Cement Co.000 $22.878 $12.417 $9.622 $67.000 $76.960 $2.137 $550 N/A $5.438 $500 N/A $0 $1.950 $3.296 $800 $25.689 $2.478.090 $749 $38.900 $1. diesel) Unocal (CMA member) Victory Oil Co.750 $23.245 $335.532 $4.712 $100 N/A $200 $16.500 $251.521 $0 N/A $50 $87.181 $1.

066 $500 N/A $250 N/A $22.438 $4.000 $900 N/A $400 N/A $500 N/A ERG Master's Project Mark Stout 58 .000 $700 $117. 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) $1.1996 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 $21.448 $424.378 $100 $21. of California.250 $21.000 $2.462 $208.000 $15.462 $500 $14.790 $100 $14.068 $14.585 $33.

an Edison lobbyist was added to the international travel party at the last minute. as well as the legislator breakdown tables and gift descriptions in Appendix E show that IOUs and large consumers. a clean power auction the CPUC repeatedly postponed upon the urging of the utility. and Inner Mongolia. Brussels. 1996. and small consumer groups.800 each. the lobbying summary tables above. for $7. including oil and natural gas companies. 4 Asmus. to meet with CEOs of the electricity industry. were able to far outspend environmental organizations (who were usually spread thin over many issues). 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 environmental groups to discuss the British experience with deregulation of electricity. “though the CPUC had imposed a ban on communications regarding the Biennial Resource Plan Update (BRPU). and Privatization” took AB 1890 author Jim Brulte and Conference Committee 79 80 Asmus. their “Travel project to Europe on Electric Restructuring. Shanghai. alternative energy producers. According to investigative writer Peter Asmus. 1996. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure.167 per guest. and Paris.As one would imagine. paying up to $7. CFEE took Fessler and Conference Committee Assemblyman Mickey Conroy on an 11 day trip to talk with Chinese central government and provincial leaders in Beijing. Conservation.79 From 3/16/94 to 3/27/94. regulators. government ministers. 4 ERG Master’s Project Mark Stout 59 . CPUC President Fessler and Commissioner Gregory Conlon were taken by CFEE on an excursion visiting London. CFEE is a “non-profit.”80 In April of 1995. From 3/28/96 to 4/8/96.

as well as their ideological resonance with a conservative Governor’s office. This analysis generates the hypothesis that these parties were most influential because of superior staff and financial resources. and academic literature. they are well suited for influencing inclusive. and why or why not different groups were successful. Based on interviews with officeholder staff and a cluster analysis of stakeholder interviews.Assemblymember Steve Kuykendall to London. Sweden. and labor unions were the most influential in the deregulation process. my analysis uses patterns in the data to create emerging theories. it appears the investor owned utilities. in order to find out which stakeholder organizations got what they wanted from California’s electric utility deregulation policy formulation process. at the mere cost of $7.490 per guest. It is not so surprising that these “thousand pound gorillas” did well in the process. state government archives. Rather than attempting to verify a pre-determined hypothesis. several patterns emerged regarding which groups got far from all of what they wanted. stakeholder-driven processes. Using the same officeholder staff interviews and stakeholder interview cluster analysis. such as the CPUC proceedings and legislative Conference Committee. Because these stakeholder groups support the capitalist state imperative of wealth “accumulation”. large industrial customers. The clean power community (renewables industry and environmentalists) were held back by a lack of unity in the face of more monolithic stakeholders. and Budapest. along with small ERG Master’s Project Mark Stout 60 . These clean power advocates. Conclusion This project synthesized data from several sources including semi-structured interviews with stakeholder representatives & officeholder staff.

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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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.. CPUC vs. AB 1890)? Why? Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings.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.e. and why? Which stakeholder groups do you think could have been more effective in influencing the policy formulation process. and how could they have improved their approach? Was it always clear what outcomes each stakeholder group wanted from the process? ERG Master’s Project Mark Stout 66 .

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

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

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

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

Also. The lucky Arizona utilities went with coal. High priced renewables are OK if you are not moving to a competitive future. We were strongly opposed to the RPS. we had the highest rates in the nation. it would be difficult to get 5% renewables. SDG&E was a supporter of the PoolCo market structure along with Edison. except for electricity purchases from Mexican geothermal generators. 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. everyone should pay. if you are a broker. We went to FERC. 1995 Decision? The PUC was on the right track. SDG&E wanted to become the lowest priced California IOU. 1996. so we would have to buy energy or credits. [The CPUC’s proposal in the December Decision would have required roughly 10% of all retail sales to be backed up by tradable credits for renewables. but are not viable with competition. When Tom Page came in as CEO in 1981. We were very opposed to the BRPU. This would put us at a competitive disadvantage compared to PG&E and Edison. they did not get there by investing in high cost renewables. and got it struck down. 84 CPUC Renewables Working Group. ERG Master’s Project Mark Stout 71 . Throughout the ‘70s.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.84] SDG&E does not have any renewables. with the exception of the legislation’s mechanism for a rate reduction.

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

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

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

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

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

1995 Decision? CMUA had no clear objective at the CPUC. our customers would have insisted on direct access because of competitiveness concerns.. as well as a longer transition period for direct access. This forced the munis to support full stranded cost recovery in the IOU CTC. The direct access reciprocity requirements were expected.. 2000. Federal power. 1995. Our proposal included voluntary participation in the PoolCo. How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? There was no time limit for municipal utility CTC recovery. an argument which CMUA refutes. public benefits programs. referring to access to tax-exempt bonds and inexpensive. The Legislature did not need to mandate this. [IOUs have made arguments about unfair competition from municipal utilities. AB 1890 has good stranded cost recovery language which includes physical bypass. CMUA decided that if we do not take a more proactive approach. We had to stay at the table in order to ensure that our concerns were addressed. 3. in order to get the legislative authority for CTC recovery. We came up with a proposal to prepare for the December Decision. App. We wanted to avoid mandates or language on an “un-level playing field”.could be used to disallow CTC collection. AB 1890 also includes a requirement for our munis to begin direct access by January 1.87] CMUA also sought the option of long CTC recovery periods for its members. Status Report on Restructuring. Also. What 87 CPUC. a quid pro quo for CTC protection. we avoided “level playing field” language on tax exempt financing.. and an outline of flexible. other than not wanting deregulation to happen. ERG Master’s Project Mark Stout 77 . we will end up playing defense. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20.

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

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

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

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

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

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

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

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

there are no savings to customers to be gained from retail competition. We initially focused on whether. but criteria of reliability and quality of service. and how the market should be shaped.How much of what your organization sought to obtain from the process was included in Assembly Bill 1890? Getting CTC recovery for worker retraining and severance packages was a major victory. but with a rational transition. a technical consultant to CUE [see preceding interview]. Marc was referred to me by David Marcus. we shifted to focus on generation. the existing unions get a contact for two years of plant operation. and distribution reliability. ERG Master’s Project Mark Stout 86 . Also. We pointed out that the only part of the industry subject to competition was the variable cost of energy. What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? We hoped to shape restructuring policy to minimize the adverse impacts on utility employees while still achieving the goals of the Commission: Lowering rates while protecting employees. and responsiveness to customer inquiries. transmission. and to what extent. We already had viable wholesale competition. As it became clear that this argument would be lost. increasing efficiencies without sacrificing reliability and service. a result where the only criteria was not cents/kWh. when a utility plant is divested to a new company.Interview #2 Marc Joseph is an attorney actively representing CUE through both the CPUC and legislative tracks. The legislation also attempts to ensure the reliability of the system by building in responsibility for inspection and maintenance into the new regulatory structure. Coalition of California Utility Employees . Enron now agrees with us. We are willing to compete. Most customers want more than incremental savings.

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

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

which Nancy and I found to be clearly outside of the purview of the Working Group’s charter. 12 accessory parts manufacturers. the essential elements of the RPS were included in the MRPR so that AWEA could largely get what they wanted. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. 1995 Decision? Nancy was successful in getting the RPS embodied in the CPUC’s Decision as a minimum renewables purchase requirement (MRPR). E-1. the MRPR was. includes 7 turbine manufacturers. Although she says the Decision language was vague. She mentioned that another stumbling block for the 90 CPUC Renewables Working Group. The RPS.” for supporting renewable electricity generation. including 155 members in California.AWEA’s 750 members. such as the Renewables Portfolio Standard.” EDF led a coalition with the only non-MRPR proposal in the CPUC Renewables Working Group. However. and is a long-term. “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. with implementation details to be worked out through a CPUC stakeholder Renewables Working Group process. ERG Master’s Project Mark Stout 89 . “corrects market failures and market barriers.” from the California electric utility deregulation process. Nancy had developed the RPS concept for AWEA since being hired on. efficient policy mechanism.”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. 22 consultants. 10 project developers/operators. academicians and interested individuals.

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

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

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

] 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. we influenced the Memorandum of Understanding that was released in August of 1995. IEP did well from restructuring. independent producers were better off working with customers. to spending millions of dollars developing California’s integrated resource planning process. and included a policy for maintaining resource diversity. For IEP. the Decision allowed for a direct access market developing. they had moved from using California’s Standard Offer process as a vehicle for the expansion of the independent power sector. the MOU allowed the restructuring process to move forward. 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. 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. but not allowed to talk. Direct access is a tool for future development. 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. By allowing utilities an opportunity to recover 100% of their stranded costs. A large portion of the MOU is reflected in the December Decision. IEP was invited to the meetings. the CPUC Biennial Resource Plan Update. 1995 Decision? Overall. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. 300 MW set aside for renewable generation. The BRPU had resulted in 1300 MW of contracts before being struck down. Over time. ERG Master’s Project Mark Stout 93 . In May. Initially.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

more than 55. EDF has participated in California energy policy issues since 1975. “a leading non-profit organization. Assuming these problems are resolved.”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. [which] represents 300. If focusing 94 CPUC Renewables Working Group. we are in favor of competition. ERG Master’s Project Mark Stout 119 . “There is no reason to proffer the benefits of competition first to only selected classes of customers.”95 How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. and 4) incentives for uneconomic sales promotion minimized. yes.Environmental Advocates Environmental Defense Fund Dan Kirshner is a Senior Economic Analyst for EDF. economics.000 of whom live in California. 1995 Decision? Almost nothing.000 members nationwide. It gave us nothing until the Legislature tells us otherwise. 2) an Integrated Resource Planning process should exist for energy efficiency. As stated in EDF’s first round comments on the Blue Book. economically viable solutions to today’s environmental problems. and law to create innovative. EDF supports the earliest possible implementation of direct access for all classes of customers. The Decision was vague. and punted on the details to the Legislature. EDF links science. depending on interpretation. E-1. if restructuring is implemented properly: 1) energy efficiency investments should continue. 3) externality accounting should ensure that customers weigh external costs in their decisions among alternate suppliers.

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

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. 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]. ERG Master’s Project Mark Stout 121 . 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. The process was like watching a movie. and were sincere about it. I was concerned that fighting for all renewable funding go to new projects may have caused a backlash. or over time? Yes. making it difficult to get agreement. I am liking the CEC report [California Energy Commission. This helped to keep a warm spot with free market ideologues.Was your organization able to publicly maintain a consistent position or set of positions in the two sets of hearings. being difficult to influence the outcome. Policy Report on AB 1890 Renewables Funding]. but time will tell on the legislative response. I took part in as many full panel hearings as I could get on to. EDF stated that we were for competition. there was not enough activity. It was the threat of a gun that got AB 1890 done. I am surprised that AB 1890 came out as well as it did. CEERT is a diverse organization. Most direct contact was after the Decision. from the beginning. I spoke several times with Jeff Dasovich in the Strategic Planning Division. EDF did suggest draft language.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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. counting only those copied to UCS. as included in Assembly Bill 1202. She went on to say that if the whole environmental community was working under a unified strategy. the legislative outcome would have been different. He is currently the counsel for the Oversight ERG Master’s Project Mark Stout 137 . I worked for UCS coordinating our participation in Clean Power Day. “progressive legislators did not have the usual suspects all opposing it”. at the very least they could have stopped AB 1890 from passing unanimously. Because of splintering and infighting within the public interest community. a legislative education and lobbying event in early August. UCS worked closely with AWEA at a June 1996 Senate Utility Committee hearing with both lobbyist Joe Caves and myself advocating for the Renewables Portfolio Standard and AB 1202. Thousands of UCS Northern California activists and supporters were informed about this opportunity to lobby legislators on renewable energy and energy efficiency issues in a coordinated way. While Joe continued to lobby Senators. which had passed the Assembly the previous year. demanding continued environmental protection and renewable energy development after the transition to a deregulated industry. Jane believes that Clean Power Day was the one unifying experience for environmental and renewable energy organizations throughout an otherwise splintered legislative lobbying process. gathering dozens of hand written letters from California residents to their state legislators.California in April. Thousands of UCS California activists received letters asking them to write their state senator in support of the Renewables Portfolio Standard. resulting in over two hundred letters to Sacramento.

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

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

There was no advocacy at all. They also killed the state agency renewable purchase requirement. our Executive Director. outside of a disinterested role in hearings and filings. This would have required state agencies to ERG Master’s Project Mark Stout 140 . A few people. We also made testimony and participated in CPUC hearings as an examiner. if any other forum we took part in. The legislators were in a vacuum trying to figure out how the allocation of public program funding got made. some of which would be “interested”. and I.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. our Public Affairs Director. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? We were technically relevant in the process. were called up to testify on specific issues as an information source only. transmission. The Governor’s office’s participation was punctuated. For the ISO. put in by the renewables community. some members perceived it as a tack-on. They weighed in against the minimum renewables purchase requirement. Edison and PG&E made arguments on takings [with regards to less than 100% stranded cost recovery] and coerced divestiture. a simple majority is to be unaffiliated with generation. The legislative language has multiple categories that should be included on the power exchange and ISO boards. or distribution companies. There was little. including Assistant Chief Counsel John Chandley. 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. however. These board members will not certainly be disinterested.

How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. but is instead offering personal observations. We were fighting for restoration of this funding from October of ‘94 to December of ‘95. there was no attempt to amend it. California Institute for Energy Efficiency Carl Blumstein is the Associate Director of the California Institute for Energy Efficiency (CIEE). In this interview. Consequently. This R&D funding cut provided a concrete example of what was being lost in the move to deregulate the electric utility industry. It could have gone further by laying out steps needed in legislation. it was vague. 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. ERG Master’s Project Mark Stout 141 . for instance by Jud King.purchase a given percentage of their electricity. Also. the Vice-Provost of the UC system. AB 1890 passed unanimously on the floor. from renewable generators. After the passage of AB 1890. there were no dollar figures given for public interest RD&D. he is not representing the position of the University. The CEC has a role allocating the lion’s share of the $62. phasing in over time.5 million public purpose RD&D annual budget. One would need to augment budgets so the agencies were not hit. This has been affirmed in statements by University Provosts. University of California. contacts between the two commissions has been informal. utility funding for CIEE had been cut off. a group at the University of California involved with energy efficiency research and development (R&D). 1995 Decision? We agreed with the stated principles of the Decision. In the process of recent years.

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

they have usually been good. but not an overwhelming one. The University is represented by a legislative affairs office. but nobody dedicated to the PUC proceedings. allowing for inertia. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? We were part of many informal groups discussing the bill. and their was a steady chatter amongst parties. myself and another University employee were there off and on.interested in technology and became a CIEE board member. supplemented by several support staff. In practice. The office has two advocates. We filed comments. and spoke at one public hearing. but they permitted some very big cuts in R&D funding in late 1994. We had a presence. We had informal contacts with the CPUC staff. about five people in the meileu. They have been favorable in principle the whole way through. For the conference committee we had an attorney representing the University. These cuts were part of the utilities' cost cutting efforts that followed the April 20th decision. The Governor can appoint one Commissioner a year. ERG Master’s Project Mark Stout 143 . and commented publicly at the Conference Committee. 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. who handle all University issues. The University has a counsel on the PUC service lists.

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

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

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

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

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

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

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

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

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

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

A lot of their lawyers did technical language work in coalition with the legislative counsel. and Working Assets were just not there when their issues came up. no one was happy. and how could they have improved their approach? Power marketers such as Enron. and why? When the PUC December Decision came out. He represented himself well in the hearings and actually helped to draft language that made it into the bill. could not go to a competitive market with a debt hindrance.Which stakeholder groups do you think were most effective in influencing the policy formulation process of AB 1890 and what were they able to obtain from the process? The IOUs were able to pull people together. They needed to get their nukes off of the books. The munis had a hard time articulating how to ERG Master’s Project Mark Stout 154 . such as CalPIRG and one of Ralph Nader’s organizations. Groups that opposed the bill without participating also were ineffective. They also were able to offer a lot of help with technical drafting. they had the manpower to make sure their positions were taken care of. If they were there and could contribute. was a one-man machine. Which stakeholder groups do you think could have been more effective in influencing the policy formulation process. IOUs very quickly were able to get 100% stranded cost recovery firmed up. NEVs. To contrast this. 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. The Committee Members took some things from the Decision. otherwise blew it up. Wayne Rafesberger. The full recovery of their stranded assets was very important to them. Which stakeholder groups do you think were best able to set the terms of the debate. a small generation developer. This was the greatest expression of coalition building. as well as an acceleration of recovery. This put everything on the table. anyone could have influence.

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

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

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

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

Interview #1 California Municipal Utilities Association . 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 .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 California Large Energy Consumers Association .Interview #2 INDEPENDENT PRODUCERS American Wind Energy Association Independent Energy Producers LARGE ELECTRICITY CONSUMERS Agricultural Energy Consumers Association California Industrial Users California Large Energy Consumers Association .Interview #1 Natural Resources Defense Council .Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees .Interview #2 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council .Interview #1 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 .How much of what you wanted was in AB 1890? INVESTOR-OWNED ELECTRIC UTILITIES Pacific Gas & Electric San Diego Gas and Electric Southern California Edison MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association .Interview #1 California Municipal Utilities Association .Interview #2 Sierra Club Union of Concerned Scientists STATE INSTITUTIONS California Energy Commission University of California.Interview #2 Sacramento Municipal Utility District UTILITY LABOR UNIONS Coalition of California Utility Employees . 0 0 1 0 1 1 3 9 10 ERG Master’s Project Mark Stout 160 .Interview #1 Natural Resources Defense Council .Interview #1 California Large Energy Consumers Association .Interview #1 Coalition of California Utility Employees .Interview #2 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council . 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 . California Institute for Energy Efficiency Total note: 1 selects column ERG Master’s Project Mark Stout 161 .Interview #1 Natural Resources Defense Council .Interview #2 California Manufacturers Association SMALL ELECTRICITY CONSUMERS Latino Issues Forum The Utility Reform Network ENVIRONMENTAL ADVOCATES Environmental Defense Fund Natural Resources Defense Council .Interview #1 California Large Energy Consumers Association .Interview #2 INDEPENDENT PRODUCERS American Wind Energy Association Independent Energy Producers LARGE ELECTRICITY CONSUMERS Agricultural Energy Consumers Association California Industrial Users California Large Energy Consumers Association .Interview #1 California Municipal Utilities Association .Interview #2 Sierra Club Union of Concerned Scientists STATE INSTITUTIONS CPUC DD AB 1890 No preference/Unclear 0 3 0 1 1 1 0 1 1 1 1 1 1 1 1 0 1 1 4 1 1 1 1 0 1 1 3 1 1 1 1 0 0 2 1 1 3 14 4 1 1 0 0 0 0 0 2 1 California Energy Commission University of California.Interview #1 Coalition of California Utility Employees .Which Policy Outcome Does Your Organization Prefer? INVESTOR-OWNED ELECTRIC UTILITIES Pacific Gas & Electric San Diego Gas and Electric Southern California Edison MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association .

191 $2.495 $1.800 $1.000 $1.429 $498 $1.000 $7.000 $495 $950 $696 $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.000 $1.000 $2.000 $1.000 $2.995 $21.Appendix E: Restructuring Stakeholder Campaign Contribution/Gift Analysis Detail Table 1: Assemblymember Jim Brulte. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.) California Independent Oil Marketers Association Chevron (CMA member) Mobil Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $22.495 $10.000 $3.500 $22.000 $3.500 $1. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS Adams Steel California Farm Bureau Federation PAC California Manufacturers Association California Mining Association PAC California Steel Industries (CLECA member) Fontana Steel Louisiana Pacific (CMA member) Mitsubishi Cement (CLECA member) National Cement (CLECA member) Riverside Cement (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $4.995 $300 $12.896 $3.495 $7.000 $0 $0 ERG Master’s Project Mark Stout 162 .000 $500 $1.000 $3.

460 $200 $500 $750 $2.000 $2.500 $1.990 $1.250 $2.000 $1.995 $0 $0 ERG Master’s Project Mark Stout 163 .495 $4.000 $1.995 $14.750 $4.500 $800 $498 $200 $9.511 $3. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS Adams Steel California Manufacturers Association California Mining Association PAC California Steel Industries (CLECA member) Fontana Steel Mitsubishi Cement (CLECA member) National Cement (CLECA member) Riverside Cement (CLECA member) Southwest Portland Cement Co.000 $8. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.995 $2.Table 2: Assemblymember Jim Brulte.) 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 $47.000 $1. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int.000 $2.500 $6. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades INDEPENDENT PRODUCERS CalEnergy Co.000 $3.017 $749 $750 $3.000 $10.995 $1.500 $1.

000 $2.1995/1996 Stakeholder Gift Information for Assemblymember Jim Brulte In 1995. From 3/28/96 to 4/8/96.490 “Travel project to Europe on Electric Restructuring. CFEE is a “non-profit. Sweden. and Privatization” visiting London. 1996.000 $2. Mobil treated Brulte to a $60 event in 1996. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.500 $1.000 $750 $0 $0 103 Asmus. Chevron treated Brulte to two meals. and Budapest. Brulte was taken on a $7. by the California Foundation on the Environment and the Economy.000 $1.000 $3.750 $2. Table 3: Senator Steve Peace. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure103.750 $750 $1. AB 1890 author Assemblyman Jim Brulte accepted no gifts from stakeholders. Paling in comparison.750 $3. as well as an event. totaling $101.000 $1. Conservation.250 $500 $1. 4 ERG Master’s Project Mark Stout 164 .000 $1. (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. Not to be outdone. 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 $300 $1.250 $2.115 $18.450 $7. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int. (geothermal) California Solar Energy Industry Association Cannon Energy (windpower) Destec (gas-fired) Independent Energy Producers Pacific Lumber Company (solid fuel biomass) SeaWest Windpower Zond Windpower DSM ENERGY SERVICE COMPANIES (ESCOS) SESCO (energy services) LARGE ELECTRICITY CONSUMERS California Manufacturers Association California Retailers Association California Steel Industries (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.500 $8.050 $3.) California Independent Petroleum PAC Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $48.500 $3.250 $1.000 $4.815 $750 $6.000 $750 $750 $750 $1.250 $7.000 $500 $2. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.100 $2.Table 4: Senator Steve Peace.500 $16.750 $0 $0 ERG Master’s Project Mark Stout 165 .000 $1.600 $2.000 $6.072 $2.572 $1.250 $750 $500 $1.

he maintained a pretty low profile in 1995 and 1996 in terms of accepting gifts and trips. In 1996.000 Table 6: Senator Byron Sher. as well as chair of the Senate Energy and Utilities Committee. SDG&E pulled on Peace’s ear over a sports event and meal totaling $89.100 $2. In 1995. Peace was treated to a $52 sports event by Mobil Oil. 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. Southern California Edison was granted a high level of access. 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. IEP made a gift of $241 for his speech at a conference.1995/1996 Stakeholder Gift Information for Senator Steve Peace Given Steve Peace’s prominence as chair of the Conference Committee on Electric Utility Restructuring.900 .450 166 ELECTRIC/GAS $6. SDG&E had Peace out to six meals. taking Steve to 11 meals. Table 5: Senator Byron Sher. while Edison treated him to five meals and a sports event.000 $5. Peace began a practice of reimbursing all utilities for meals and outings starting with Edison in 1995.

(biomass) Edson + Modisette (lobbyist for indep.482 $100 $1.000 $500 $1. $2. Brotherhood of Electrical Workers (various $9. EVs) Hansen. (gas-fired) American Wind Energy Association Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co.100 $500 $2. McQuat.000 $500 $500 $9.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 $1.500 Int. and Hamrin.000 $100 producers.600 $13. Inc (consultants) $200 ERG Master’s Project Mark Stout 167 .882 $100 $1. of Journeymen & Apprentice Underground Utility/Landscape INDEPENDENT PRODUCERS AES Pacific/SF Energy Co. (geothermal) Colmac Energy Inc.000 locals) Southern California Pipe Trades United Assoc.

000 $100 $100 $500 $1.000 (tire $1.000 $1.000 Large Energy Consumers $3.500 COMPANIES $1.000 $1.000 $100 $1.Indpependent Energy Producers Modesto burning) SeaWest Windpower United American Energy Wadham Energy Limited Partnership (biomass) Zond Windpower DSM ENERGY SERVICE Energy Limited Partnership $1.250 $100 $50 $500 $500 $250 ERG Master’s Project Mark Stout 168 .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 $700 $4.Tosco Corp. of California.462 $100 $900 $400 $500 ERG Master’s Project Mark Stout 169 . California Institute for Energy Efficiency California Integrated Waste Management Board (biomass proponents) Nevada Community Action $1.585 $100 $500 $2.448 $14.000 $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.

1995/1996 Stakeholder Gift Information for Senator Byron Sher In 1995. but his Statement of Economic Interest reveals large holding of oil and electricity stocks.300 $500 $1. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS INDEPENDENT PRODUCERS LARGE ELECTRICITY CONSUMERS California Steel Industries (CLECA member) Riverside Cement (CLECA member) Tamco Steel (CLECA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $3. totaling $758. totaling $2608.500 $0 $0 ERG Master’s Project Mark Stout 170 . and GE. Exxon.400 $750 $150 $1. Sher holds over $100. 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. In 1996. NARUC treated Sher to a two day trip to DC for another meeting. Mobil.000 $1.000 in each of Amoco. Sher received no other gifts that year from energy utility stakeholders. Table 7: Senator Bill Leonard.500 $300 $0 $0 $2.

(geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS California Mining Association PAC California Portland Cement Co. SDG&E bought Leonard a $125 ticket to the Pete Wilson Inaugural Gala. extending his stay from 12/8/96 to 12/13/96. WA paid $734 for Leonard to moderate a conference session on utility deregulation.500 $150 $500 $3.000 $500 $500 $4.500 $500 $1. Edison’s lobbyists got to spend a little more quality time with Leonard for their money. (CLECA member) California Steel Industries (CLECA member) Mitsubishi Cement (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $1.000 $2. SCE treated Leonard to dinner and lodging for Legislative Ski Day. The Pacific Rim Conference of Seattle. SCE treated him to a $30 beach party and a $20 lunch with lobbyist Bob Foster. While the Senator was there.) Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $19. 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.000 $5.Table 8: Senator Bill Leonard.000 $2.650 $500 $1.000 $2. saving up for a $77 dinner with head lobbyist Bob Foster.000 $1. for a paltry $20.000 $0 $0 1995/1996 Stakeholder Gift Information for Senator Bill Leonard In 1995.080 $10.650 $2. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co. Senator Leonard was courted a little more heavily by energy stakeholders in 1996. and a $75 dinner at the American Legislative Exchange Council’s annual meeting. Edison again ERG Master’s Project Mark Stout 171 .730 $2.

including lunch with Bob Foster. paying $44 for two meals and lodging.250 $1.000 $1. PG&E took Leonard out to a Kings game. Table 9: Assemblymember Mickey Conroy.000 $1.250 $750 $0 $0 ERG Master’s Project Mark Stout 172 .000 $1. for the modest tab of $56.000 $750 $750 $650 $150 $500 $3. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Joint Electrical Industry Fund Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS California State Association of Electrical Workers INDEPENDENT PRODUCERS Indpependent Energy Producers LARGE ELECTRICITY CONSUMERS Adams Steel Louisiana Pacific (CMA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co. They also had Leonard out for two meals in Sacramento.had Senator Leonard out for Legislative Ski Day.) Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $6. ARCO treated Leonard to a $19 meal at a reception.600 $1.750 $1.600 $750 $750 $500 $1.

700 $750 $450 $250 $250 $1.600 $500 $1.500 $2.000 $5. $7.300 junket to talk with Chinese central government and provincial leaders in Beijing.600 $3. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades INDEPENDENT PRODUCERS Destec (gas-fired) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS Adams Steel California Portland Cement Co. CFEE is a “non-profit.000 $2. and Inner Mongolia.700 $500 $300 $550 $2. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure104. (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.) California Independent Petroleum PAC Chevron (CMA member) Southern Counties Oil Co.050 $1.Table 10: Assemblymember Mickey Conroy.000 $500 $750 $250 $500 $2. PG&E treated him to a basketball game with $51 tickets. 1996. 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.000 $3. Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $9. the California Foundation on the Environment and the Economy took Conroy on an 11 day.000 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Mickey Conroy In April of 1995. 4 ERG Master’s Project Mark Stout 173 .000 $500 $2. and to 104 Asmus. two meals for $44.

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

(geothermal) Indpependent Energy Producers OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.750 $2.750 $1.Table 11: Assemblymember Diane Martinez.750 $2.000 $1.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.675 $2.250 $1. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS California State Pipe Trades Council PAC Int.175 $500 $1.000 $1.250 $1.750 $4.750 $750 $500 $500 $750 $0 $0 ERG Master’s Project Mark Stout 175 .750 $1. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.000 $1.

000 $1.500 $6.500 $1.000 $500 $500 $500 $500 $500 $3. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises MUNICIPAL ELECTRIC UTILITIES Gualco Group (lobbyist: Imperial & Modesto Irigatn.000 $1.000 $4.000 $0 $0 ERG Master’s Project Mark Stout 176 .Table 12: Assemblymember Diane Martinez.000 $7.000 $500 $3.500 $1. Dist.000 $500 $500 $5. (CLECA member) California Steel Industries (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $4.500 $500 $500 $1.500 $1.500 $1. (member of IPPs of NY) Zond Windpower LARGE ELECTRICITY CONSUMERS California Manufacturers Association California Portland Cement Co.000 $1.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $20.750 $1.250 $1.) UTILITY LABOR UNIONS California State Association of Electrical Workers Int. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.000 $500 $1.000 $5. (geothermal) Destec (gas-fired) Enron Capital & Trade (gas-fired) GWF Power Systems (oil and coal-fired) Pacific Lumber Company (solid fuel biomass) Sithe Energies Co.

000 $8.500 $1.600 $1. (bulk terminals) Mobil Tidelands Oil Tower Energy Group (oil.100 $100 $1.208 $0 $0 $1. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear plants) Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS INDEPENDENT PRODUCERS LARGE ELECTRICITY CONSUMERS Louisiana Pacific (CMA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.) California Independent Oil Producers Chevron (CMA member) Kaiser International Corp.500 $1.600 $500 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Diane Martinez In 1995.000 $500 $500 $1.Table 13: Assemblymember Steve Kuykendall.467 trip to Northwestern University to discuss the deregulation of public utilities. diesel) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.900 $3. the Illinois Energy Association flew Martinez out for a $1. ERG Master’s Project Mark Stout 177 .850 $1. The Assemblymember enjoyed no such gifts from deregulation stakeholders in 1996.000 $1.058 $500 $500 $1. natural gas.

ERG Master’s Project Mark Stout 178 . and Privatization” visiting London.374 $500 $2.) California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Mobil Texaco Tidelands Oil Tower Energy Group (oil.374 $4.443 $6.500 $1.000 $500 $2. Western States Petroleum Association treated Kuykendall to a reception and a dinner totaling $62.000 $1. diesel) Unocal (CMA member) Victory Oil Co.350 $500 $1.989 $500 $500 $0 $0 1995/1996 Kuykendall Stakeholder Gift Information for Assemblymember Steve In 1995. From 3/28/96 to 4/8/96.500 $0 $1.000 $1.000 $2.254 $200 $500 $4. and Budapest.000 $19. Kuykendall was taken on a $7.Table 14: Assemblymember Steve Kuykendall. natural gas. Conservation.250 $100 $500 $35. 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.490 “Travel project to Europe on Electric Restructuring.500 $1.000 $1. However. Kuykendall’s social calendar was destined to pick up in 1996. SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $10. Sweden.

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

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

000 in each of Chevron. by the California Foundation on the Environment and the Economy.000 in each of Central & Southwest Corp. Knight did not report any electricity deregulation stakeholder gifts in 1994 or 1995. and Schlumberger oilfield services stock. to meet with CEOs of the electricity industry. spending $258. Conlon was taken on a $7. regulators. He does own more than $10. He does own less than $10. government ministers. In 1995. wholesale PoolCo model. Jr. 1994/1995 Stakeholder Gift Information for Commissioner Jesse Knight. and environmental groups to discuss the British experience with deregulation of electricity. was very interested in California moving to the UK-style. and Paris. ERG Master’s Project Mark Stout 181 . one of CFEE’s funders. PG&E had him out to three meals for $71.1994/1995 Stakeholder Gift Information for Commissioner Gregory Conlon From 3/16/94 to 3/31/94. He left office on February 23. the Northwest Electric Light and Power Association flew Shumway to their 3rd annual Non-Utility Generation Conference. Unocal. 1994/1995 Stakeholder Gift Information for Commissioner Henry Duque Duque did not report any electricity deregulation stakeholder gifts in 1994 or 1995. 1994/1995 Stakeholder Gift Information for Commissioner Norm Shumway In February of 1994. and less than $10. utility and General Electric stock. 1994/1995 Stakeholder Gift Information for Commissioner Josiah Neeper Knight did not report any electricity deregulation stakeholder gifts in 1994 or 1995.000 in each of Montana Power Company and Exxon stock.167 junket visiting London. Edison. 1995. The Edison Electric Institute spent $279 to fly the Commissioner to a conference on the results of State Competition in Boca Raton. Brussels.

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