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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edf. This paper develops a comparison of which stakeholder groups got what they wanted. 1996 California Energy Commission.S. 1 2 CPUC RD&D Working Group. there will probably be significant winners and losers as a result of this legislation. This bill is an important milestone in an ongoing process towards electric utility deregulation in California.Introduction On September 23. selling 250 billion kWh of electricity per year2. and why.3 According to the Environmental Defense Fund. 1996. which sets in motion a process of electric utility deregulation beginning in 1998.4 Given the stakes involved with this industry. representing a spectrum of private and public interests attempted to influence both the CPUC and legislative processes.org/programs/Energy/green_power/a_better. a product with well documented environmental impacts including local air pollution. 1995 Electric Restructuring Decision. Various stakeholder groups.html ERG Master’s Project Mark Stout 4 . 1995 Decision with the California legislative process resulting in AB 1890. California electric utilities have a combined annual revenue of roughly $23 billion dollars1. 1994 4 WWW page: http://www. fossil fuel-based electricity generation is currently the largest source of greenhouse gas emissions and the largest source of air pollution in the U. 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. which will be superseded to a great extent by the details of AB 1890. contrasting the results of CPUC process resulting in their December. with varying success. 1995 3 Flavin and Lenssen. Governor Pete Wilson signed into law California Assembly Bill 1890 (AB 1890). acid rain and climate change.

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

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

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

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

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

5

Glaser and Strauss, 1967, Glaser, 1978.

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

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

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

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

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

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

1999.”16 CPUC “Blue Book” Proposal California’s Public Utility Commission is widely viewed as a trend-setter for state PUC electric utility regulation.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. In April of 1994. with large. customer class-staged schedule for direct access implementation. and if successful. 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. A more definitive policy statement was 16 17 Haddad. 1996. 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 CPUC issued a staff proposal regarding electric utility deregulation known as the “Blue Book”. 6.17 A security analyst noted that the release of the Blue Book will: speed up the deregulation of the industry. sending “a shockwave through the electric industry”. all residential consumers eligible on January 1. and 3) rate changes to encourage efficiency and distribution of power. Hoffman. industrial customers taking power at the transmission level eligible on January 1. 18 Mydans. 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.supplies. 2) providing cost recovery for energy efficiency programs that are at least as profitable as supply side measures. The Blue Book laid out an aggressive. all commercial customers eligible January 1. ERG Master’s Project Mark Stout 12 . 55. 2002.

For instance. 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. 21 CPUC. Blue Book. 1. where customers voluntarily pay more to promote renewables. 1995. ERG Master’s Project Mark Stout 13 . FERC released a dual-issue Notice of Proposed Rulemaking. which had been dubbed the MegaNOPR. “a vibrant market exists for energy efficiency services”. 1995. Status Report. 1994. “alternative frameworks based on ‘let the market decide’”. pushing back their goal for a policy decision until September of 1995. The first issue addressed open access to the transmission system 19 20 CPUC. where CPUC President Fessler and Commissioner Knight testified on their proposal. including private and public-interest organizations. prompted the Assembly Committee on Utilities and Commerce and the Assembly Committee on Natural Resources to hold a joint oversight hearing on May 23. Blue Book. coupled with a lack of prior coordination with the state Legislature.scheduled to be issued by the CPUC in August of 1994. such as “green pricing”. and documentation resulting in a report back to the Governor and Legislature by January 31.22 FERC MegaNOPR In March of 1995. and asserted that. Wagner. 1994. which requires the CPUC to engage in a series of public hearings. In their place. This process tempered the CPUC’s frenetic timetable. the CPUC proposed.20 Many stakeholders. This led to the passage of Assembly Concurrent Resolution 143. were concerned about the content and timetable of this proposal. evidentiary hearings.21 This stakeholder response. 1994. numerous other states have also proposed electric utility deregulation.19 Since the release of the Blue Book proposal.

the California Commissioners released two draft proposals for pursuing rate deregulation in California. Stranded costs are past investments rendered uneconomic (market value less than book value) by the competition brought about through deregulation. which is usually considered state jurisdiction. 1995. A common price for all electricity in the state would then be set by the market clearing price based on the bids. The majority proposal known as PoolCo. Retail contracts with a particular generator could be handled with separate “contracts for differences”. All power purchases would be made through the pool. Generators are scheduled into the pool based on time-based bids submitted to the ISO. favored by CPUC President Fessler and two other Commissioners. in May of 1995. Although stranded costs due to wholesale competition would be much smaller then those posed by retail competition.24 22 23 CPUC. scheduled and dispatched by an independent system operator (ISO). 1997.23 CPUC May 1995 Draft Proposals and Stakeholder Responses As a result of the Blue Book CPUC staff proposal. Asmus and Smeloff. is based on a common wholesale power pool.for wholesale transactions. The MegaNOPR also granted utilities the ability to collect 100% of their stranded costs due to wholesale transactions. forcing utilities to allow non-utility generators to use their transmission systems on a “comparable basis” at standard tariffs. meaning the utilities could not discriminate against other electricity suppliers. Status Report. 24 CPUC PoolCo Proposal ERG Master’s Project Mark Stout 14 . some thought the MegaNOPR ruling may set a precedent for 100% stranded cost recovery at the retail level.

investor owned utilities in California). or through the creation of optional pools which could manage bids in a manner similar to the PoolCo proposal. know as the “Memorandum of Understanding” (MOU). and low-income weatherization would be funded at 25 CPUC Direct Access Proposal ERG Master’s Project Mark Stout 15 . wholesale pool. California Large Energy Consumers Association. Full stranded cost recovery is agreed to for Edison. No central entity would schedule power generation. Southern California Edison Company (one of three regulated. it is a hybrid of the two proposals. Bids for generation into the pool would be processed by a Power Exchange (PX). as well as a central. Prices would be determined either through bilateral contracts between direct access customers and generators. a group of seemingly influential special interests. California Manufacturers Association. and the actual generation scheduling and dispatch decisions would be made by a separate Independent System Operator based on transactions mediated by the PX as well as direct access contracts. The MOU also proposed a nonbypassable charge to fund public policy programs. In structure. low-income ratepayer assistance would be funded at an uncapped. the only IOU signing the MOU. Out of this surcharge. met to iron out differences between them and draft their own industry restructuring proposal. funding levels for energy efficiency. who is responsible for maintaining transmission system reliability. as-needed basis.Commissioner Knight’s alternate proposal is based on direct access contracts between generators and customers. although generators would submit projections to an independent system operator (OPCO).3% of total utility revenue requirements as of January 1.25 In response to the Commissioner proposals. renewables. and Independent Energy Producers. at the prompting of California Governor Pete Wilson. including bilateral contracts for direct access customers. 1995. and R&D were not to exceed 3.

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

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

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

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

and 15% consumer-side incentives. would be eligible for direct access January 1. The overall levels are: 45 % existing technologies.42 This bill includes a "minimum renewable energy generation 39 40 Carter and Cavanagh. the CPUC released its latest restructuring decision which surprised stakeholders by announcing that all customers. 1997. “Primed for Congressional Battle” ERG Master’s Project Mark Stout 20 . 1996 CEC.environment/equity agenda” which had gripped the industry since the release of the Blue Book in 1994. In March of 1997. chair of the House Energy and Power Subcommittee. As Carter and Cavanagh have noted. 1997 41 Marshall. 30% new technologies.41 There are currently several electric utility restructuring bills in Congress. 10% emerging technologies. 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. 1997.40 On May 6. 1998. “If the bill had failed. including residential and small commercial consumers. It divides up this amount into four accounts that vary over four years of funding. the CPUC and California Energy Commission (CEC) have been working towards the implementation of this legislation. the California PUC was on a clear course to abandon all [funding for public purpose programs] on grounds of lack of statutory authority. 1997 42 Weisman. including a prominent one authored by Representative Dan Schaefer (R-CO).”39 Recent State and Federal Activity Since the signing of AB 1890 into law.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

most organizations preferred the INDEPENDENT PRODUCERS SMALL ELECTRICITY CONSUMERS LARGE ELECTRICITY CONSUMERS Rather Little Mixed/Unclear Most language of AB 1890.Figure 4: How much of what your organization wanted was in AB 1890? One of the interview questions asked which policy outcome was STATE INSTITUTIONS ENVIRONMENTAL ADVOCATES preferred by the subject’s organization. either the CPUC December Decision or AB 1890. 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. As Figures 5 indicates. as opposed to the nonbypassable surcharge funding mechanism adopted in AB 1890 ERG Master’s Project Mark Stout 39 . Figure 6 shows that the only organizations interviewed that prefer the December Decision are among the environmental and UTILITY LABOR UNIONS MUNICIPAL ELECTRIC UTILITIES INVESTOR-OWNED ELECTRIC UTILITIES independent power communities.

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

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

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

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

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

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

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

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

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

The August 15 language from a coalition of powerful interests. hot days of August in the 1996 Conference Committee reveals that this “consensus” funding level took a large hit on August 15..A prominent example of a failed consensus was the 11th hour changes to the funding levels that had been agreed to in the Memorandum of Understanding. funding for public purpose programs: low income. agricultural consumers. EDF. 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. and energy efficiency.. roughly $660 million a year for the IOUs alone] of utility revenues for public purpose programs in the MOU came out of these discussions. CLECA. reduced funding to an average of 2.1% of IOU revenues. “We reached a consensus on. A legislative outcome related to “green” pricing for renewables provides another example of an ephemeral consensus. renewables with an incremental cost estimate from the BRPU. less than two weeks before the Bill would be reported out of committee. TURN was one of several public interest organizations who opposed the change.72 At this point late in the game.3% of utility revenues. Industrial Users. not simply subsidizing other consumers or increasing IOU shareholder profits 72 Confidential binder of proposed language and other stakeholder notes ERG Master’s Project Mark Stout 49 . The 3% [it was actually a cap of 3. including IEP.” However. RD&D.. These got translated into dollars. As a Sierra Club California legislative chair recounts on meetings between CMA. 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. During the Conference Committee hearings. a perusal of legislative language that was proposed during the long. and the Sierra Club..

73 However. States simply must provide the conditions that facilitate capitalist investment and economic growth.influential players relied on a “fairness and competition” argument. recession. She pointed out the public relations/marketing dilemma that would result if “green” customers found out they were having no real impact on increasing the use of renewable generation..74 Dryzek has voiced concern that by accepting a seat at government policymaking tables. There was no significant opposition to this point during the hearing. and unpopularity in the eyes of the public. “.. As he explains. 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. so that the [legislative] Members and Governor bought in that restructuring would be good for California businesses. falling tax revenues. if they pursue antibusiness policies. To the extent that public policy remains under the sway of state imperatives.the first imperative facing states in capitalist systems is what post-Marxists call “accumulation”. “Large businesses articulated the issues. . the final language of AB 1890 allows IOU customers to voluntarily contribute money to support renewable development. section 381. then they are punished by “capital strike”.for a static amount of renewables capacity. 1996 ERG Master’s Project Mark Stout 50 . 75 The state imperative of “accumulation” came up several times during interviews with officeholder staff. This had 73 74 California Senate TV video of August 10. subdivision (e) 75 Dryzek..” An anonymous staffer’s comment also resonated with this state imperative. one Senator’s Chief of Staff revealed. receiving “symbolic rewards only”. without making it at all clear if these voluntary contributions will actually decrease the amount the IOUs must contribute towards renewables support funding from their frozen revenues. As noted earlier... but outcomes will be systematically skewed against them.. 1996 Conference Committee on Electric Restructuring AB 1890. They may be allowed to participate in the policymaking process..

”. During my experience representing an environmental stakeholder organization in this process.. be justified by the instrumental benefits thereby achieved. bought at the expense of relatively unrestricted democratic interplay in the oppositional public sphere. and Senator Peace represents a district in the San Diego area.validity for Committee Members. But if there are no instrumental benefits. 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.. “For those of you who have intra-familial differences. Inclusion in the life of the state is. 1996 meeting. who deal daily with issues of economic development. they may lose out altogether.” As Peace said himself during the Conference Committee’s August 10.76 Another factor that impaired the public interest groups was that Conference Committee Chair Steve Peace was able to coerce these groups into accepting compromises they would not have otherwise. the RPS is a “non-starter” because San Diego Gas and Electric (SDG&E) does not like it”. Dryzek also notes the impact that this “democratization as inclusion” has had on the ability of progressive organizations to function in a democratic. We will 76 Dryzek. 1996 ERG Master’s Project Mark Stout 51 . the loss is harder to justify. Peace was threatening to handle renewable energy policy himself. “quit beating a dead horse. The Governor has the same goal: empower people for economic development.. where he bullied advocates for the Renewables Portfolio Standard. According to an NRDC analyst who was interviewed. under the threat of retribution. and nobody would have been happy.. I read accounts of public hearings chaired by Peace. “It was very clear that if everyone did not work together. then. it will not inure to your benefit for those differences to still exist on Monday. Senator Peace’s response to this policy mechanism was along the lines of. The democratic loss experienced by entry into the state can.

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

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

149 $3.496 $8.981 $1.031.163 $0 $25.166 $5.102 $0 $73.608 $3.000 $62.675 $384.416 $5.470 $10.000 $1.374 $1.112 $3.079 $950 $14.500 $1.272 $0 $64.079 $13.180 $0 $209.592 $846 $0 ERG Master's Project Mark Stout 54 .000 $634.419 $13.000 $480.752 $0 $51.110 $34.675 $736.000 $0 $70.500 $533.101 $495 $10.000 N/A $0 $18.964 $0 $40.630 $300 N/A $0 $5.819 $0 $323.588 $500 $32.745 $68.741 $21.092 $3.500 $263.075 $4.995 $596. 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.181 $0 $160.000 $225.595 $0 $21.405 $0 $722.308 $516.000 $681.370 $648 N/A $0 $208.096 $971.758 $2.500 $190. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.835 $1.153 $750 N/A $8.1995 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas General Electric (nuclear plants) Joint Electrical Industry Fund Pacific Gas & Electric/U.125 $0 $4.479 $2.500 $78.559 $0 $246.157 $0 $188.952 $1.818 $0 $65.239 $0 N/A $0 $89.203.000 $562.516. (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.S.

291 $3. (gasoline refining and marketing) Tower Energy Group (oil. 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 $4.083 $0 $20.000 $383.000 $0 $171.362.947 $500 $281.000 $20.271 $0 $12.197 $500 N/A $2.000 $526.400 $100 $79.203 $0 $30.230.055 $0 $151.938 $0 $118.716 $39.000 $37.519 $11.167 $500 $25.675 $0 $1.495 $1.723 $0 $38.203 $5.081 $1.1995 Lobbying Totals RMC Lonestar (CLECA member) Southwest Portland Cement Co.000 $524.596.500 $0 $0 ERG Master's Project Mark Stout 55 .000 $0 $6.492 $0 $66.326 $0 $100.000 $0 $15.207 $5.099 $12.145 $5. (bulk terminals) Mobil Texaco Tidelands Oil Tosco Corp. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO California Independent Oil Marketers Association California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Exxon Kaiser International Corp.495 $27. natural gas.600 N/A $5.401 $1.551 $12.600 $32.850 $1.003.250 $0 $30.319 $0 $10.701 $0 $5.665 $0 $262.

500 N/A $0 $211.845 $452.060 $6.782 $981.750 $267.331 $0 $97.724 $500 not applicable $500 $57.032 $0 $172.600 $276.750 $418.000 N/A $100 N/A $7.S. 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.000 $35.450 $566.905 $30.882 $15.100 $144. producers.000 NA $500 $0 $2.250 N/A $100 N/A $2. Dist.1996 Lobbying Totals INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Electric Power Research Institute General Electric (nuclear plants) Pacific Gas & Electric/U.400 $1. and Hamrin.000 $85. (biomass) Destec (gas-fired) Edson + Modisette (lobbyist for indep.543 $29.250 $148.571 $500 N/A $200 N/A $1.017 $1.500 N/A ERG Master's Project Mark Stout 56 .917 $300 $5. (geothermal) California Cogeneration Council California Solar Energy Industry Association Cannon Energy (windpower) Colmac Energy Inc.118 $0 $144. McQuat.000 $209.200 $837.286 $3.748 $32.025. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades United Assoc. EVs) Enron Corporation (gas fired) GWF Power Systems (oil and coal-fired) Hansen. 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.229 $100 N/A $1. of Jrnymn & Aprt Underground Utility/Landscape Utility Workers Union of America INDEPENDENT PRODUCERS AES Pacific/SF Energy Co.281 $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) $145.000 $33.611 $1.500 $29.590 $5.862 $21.454 $3.100 $0 $500 N/A $100 $0 $500 N/A $2.159 $3. (gas-fired) American Wind Energy Association Bechtel (gas-fired) Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co.) Imperial Irrigation District Modesto Irrigation District Northern California Power Agency Sacramento Municipal Utility District Turlock Irrigation District UTILITY LABOR UNIONS California State Association of Electrical Workers California State Pipe Trades Council PAC Int.000 $50.179 $0 $3.717 $500 not applicable $0 $138.240 $0 $178.147 $500 $739.819 $921.626 $0 $8.195 $401.605 $250 N/A $1.589 $26.750 $1.460 $50.

250 $34.885 $300 $207.347 $9.050 $949.721 $748.995 N/A $100 N/A $0 $3.050 N/A $0 $214.636 $0 $103.661.643 $1.750 $37. (gasoline refining and marketing) Tower Energy Group (oil.650 $3.296 $800 $25.622 $67.989 N/A $9.878 $12.521 $14.800 not tracked $3.500 $47.1996 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.000 $22.137 $550 N/A $5.245 $335.861 $1.900 $1.573 $2.016 $1.521 $0 N/A $50 $87.900 $0 $21.478.209.780 ERG Master's Project Mark Stout 57 .950 $3.712 $100 N/A $200 $16.500 $251. (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.334 $498 $1. diesel) Unocal (CMA member) Victory Oil Co. (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.384 $2.532 $4.407 $200 $61.090 $749 $38.495 $22.181 $1. Western States Petroleum Association SMALL ELECTRICITY CONSUMERS California Nevada Community Action Association Greenlining Institute The Utility Reform Network (TURN) Utility Consumer's Action Network (UCAN) Conference Committee Total California Campaign Lobbying Expenses Contributions (Jan-Sept) $41.072 $918.000 $233.960 $2.754 $4.689 $2.958 $2.000 $65.177 $300 N/A $0 $29. natural gas.438 $500 N/A $0 $1. Texaco Tidelands Oil Tosco Corp.705 $19.750 $23.521 $1.417 $9.925 $0 $44.500 $277.000 $500 $456.000 $76.138 $1.511 $1.761 $0 $73.

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.068 $14.462 $500 $14.378 $100 $21.000 $700 $117.790 $100 $14.000 $900 N/A $400 N/A $500 N/A ERG Master's Project Mark Stout 58 .000 $15.438 $4.462 $208.448 $424.000 $2.066 $500 N/A $250 N/A $22.585 $33.066 $500 $21. 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. of California.250 $21.

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

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

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

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

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

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

82 83 CPUC Renewables Working Group. ERG Master’s Project Mark Stout 70 . and gas service to 0.15 million electric customers in San Diego and southern Orange Counties. while holding on to what they really wanted. App.7 million customers in San Diego County. SDG&E. Kathy said that what mattered most in influencing the formulation of AB 1890 was responsiveness to Steve Peace’s requirements.” according to Kathy. “Uncertain road ahead for utilities” and Enova Corporation 1996 annual report. 1996. Sirard. SDG&E provides service to 1. a gas utility which serves a territory largely overlapping with Southern California Edison’s. “a subsidiary of Enova Corporation. the parent company of Southern California Gas Company83. Jack. 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.” Organizations had to be able to make decisions right on the spot to shape the outcome. is a California Investor Owned Utility Company founded in 1881.”82 Enova Corporation has announced a merger with Pacific Enterprises. “People who influenced the outcome were present. San Diego Gas and Electric Jim Cassie is the Director of State Governmental Affairs for SDG&E. It allows an organization to get buy-in from other parties in advance.reasonableness check. and willing to be straightforward on what they can give on. 1996. E.

except for electricity purchases from Mexican geothermal generators. SDG&E was a supporter of the PoolCo market structure along with Edison. [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. We were very opposed to the BRPU. When Tom Page came in as CEO in 1981. everyone should pay. so we would have to buy energy or credits. and got it struck down. with the exception of the legislation’s mechanism for a rate reduction. they did not get there by investing in high cost renewables. 84 CPUC Renewables Working Group. SDG&E wanted to become the lowest priced California IOU. ERG Master’s Project Mark Stout 71 . The lucky Arizona utilities went with coal. We were strongly opposed to the RPS. We went to FERC. 1995 Decision? The PUC was on the right track. It does not make sense for SDG&E alone to go out and acquire more expensive renewable resources. AB 1890 mirrors the Decision in many ways. High priced renewables are OK if you are not moving to a competitive future. Throughout the ‘70s. we had the highest rates in the nation.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. but are not viable with competition. if you are a broker. it would be difficult to get 5% renewables. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20.84] SDG&E does not have any renewables. Also. 1996. This would put us at a competitive disadvantage compared to PG&E and Edison.

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

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

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

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

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

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

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

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

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

Some would argue that the SMUD customer did not decide to open Rancho Seco. How much of what your organization sought to obtain from the process was included (or represented) in the California Public Utility Commission’s December 20. if any. We are a consumer elected entity. it is planned that PG&E will drop their rates below SMUDs by 2002. Assemblyman Steve Kuykendall was direct in his comments. what equity or fairness issues were raised by them being in the marketplace. Even though municipal utilities have the authority to recover costs. It created an environment of uncertainty. SMUD would have been well served if the PUC jacked up IOU commitments for ERG Master’s Project Mark Stout 81 . By constructing a brave new world for IOUs. The munis are in a foreign land with the PUC. with board candidates who run on platforms of clean energy and social responsibility that our consumers want sustained. should a public agency have in a restructured environment. There was also a concern that munis would be constrained to the same clock as the IOUs in terms of the duration of the CTC recovery period. SMUD will finish recovering our CTC by 2002. this made the question go away. It is difficult to maintain public purpose programs if everyone else abandons them. 1995 Decision? There is nothing of direct benefit to SMUD in the Decision. it seemed obvious that these principles were a gimme. In the June. SMUD responded. we have to resolve this by 2002. there was a questioning of what role. he does not see a role for munis in a deregulated world. ‘96 Rate Restructuring Settlement. This was the bottom line. that some other source should pay. The Legislature did not elevate this to a well-reasoned.Going into the process. there was a question of whether we would get 100% stranded cost recovery. SMUD is very committed to renewables. This is a classic question of public versus private decision making. SMUD’s territory is a small island surrounded by PG&E. philosophical debate. energy efficiency -.clean energy. this impacts munis. Since our rates were 25% below PG&E’s. But in reality.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

The December Decision did a fairly good job in recognizing low income ERG Master’s Project Mark Stout 111 . In some ways this was not a very lofty goal. and add needed education and protection programs in order to at least maintain the status quo for small consumers. Overall. 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. The interview subject preferred to remain anonymous. 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. our goal was to protect as much of the old programs as possible. In addition. 1995 Decision? In an outline form. 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. a non-profit organization advocating for Latino Californians. 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. need-based level. We wanted to keep the CARE (California’s Alternative Rates for Energy) program funded at an uncapped. We realized it was not realistic to resist retail competition as TURN had tried in telecommunications. “the devil is in the details”. everything was included. but it was realistic. but as Dan Fessler was fond of saying.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.

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

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

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

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

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

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

If you can get all of the big dogs to reach consensus. like an armadillo in the middle of the road. TURN tried to marshal support with kindred groups UCAN [Utilities Consumers’ Action Network. making it very easy for the Republican Commissioners to adopt. IPPs. I went up three or four times. taking care of small consumers would have led to compromise. it was all over. and IPPs [Independent Power Producers]. another small consumer advocacy group] and Greenlining Institute/Latino Issues Forum [low income and minority community advocates]. nobody gave everything up. big customers.for the meetings leading up to the MOU. 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. Hearings were going on till two or three AM. Lenny was in the Conference Committee every day. Once Edison was on board for Direct Access. utilities. Critical consumer interests were not present. supported by the appropriate staff. the whole thing would fall apart with parties leaving the table. Several times people did leave the negotiations. issue specific attorneys with support staff. TURN contracted with Lenny Goldberg. The “consensus process” was just everybody taking. Public purpose concerns become peripheral. with a troika of large customers. unions. What methods and approaches were used to advance your organization’s goals and objectives in the Assembly hearing and the subsequent issuance of AB 1890? TURN hoped that if you knocked out enough of the gifts. So much of the deal had been cut in advance by large powerful interests. it is tough to stop the momentum. utilities. There were waves of utility employees. they just loaded up the plate. ERG Master’s Project Mark Stout 118 . creating a huge advantage to have a fresh mind.

more than 55.000 of whom live in California.Environmental Advocates Environmental Defense Fund Dan Kirshner is a Senior Economic Analyst for EDF. if restructuring is implemented properly: 1) energy efficiency investments should continue. 3) externality accounting should ensure that customers weigh external costs in their decisions among alternate suppliers. and law to create innovative. yes. EDF has participated in California energy policy issues since 1975. The Decision was vague. EDF links science. economically viable solutions to today’s environmental problems. and punted on the details to the Legislature. 2) an Integrated Resource Planning process should exist for energy efficiency. If focusing 94 CPUC Renewables Working Group. ERG Master’s Project Mark Stout 119 . “a leading non-profit organization. “There is no reason to proffer the benefits of competition first to only selected classes of customers. economics. Assuming these problems are resolved. and 4) incentives for uneconomic sales promotion minimized. E-1. EDF supports the earliest possible implementation of direct access for all classes of customers. As stated in EDF’s first round comments on the Blue Book.”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. 1995 Decision? Almost nothing. [which] represents 300. It gave us nothing until the Legislature tells us otherwise. we are in favor of competition.000 members nationwide.”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. depending on interpretation.

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

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

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

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

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

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

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

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

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

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

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

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

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

ERG Master’s Project Mark Stout 133 . The level of renewables support included in the BRPU served as a target for UCS. Peace was the idea person. As the deregulation process unfolded at the CPUC. UCS’s overriding goal was to ensure policy were developed that would provide for continued environmental protection with regards to renewables and energy efficiency.000 sponsors nationwide. manifest in California as the Biennial Resource Plan Update (BRPU). UCS’s initial position after the release of the CPUC Blue Book Proposal was that the deregulatory roadmap laid out in this proposal was too hasty.000 in California”. Union of Concerned Scientists Jane Kelly is the California Policy Coordinator for the Union of Concerned Scientists. was just beginning to be used as a policy option in several states. UCS was also opposed to 100% “stranded cost” recovery for utilities. E-3. UCS has 100.John White were the front folks. pointing towards a future based on environmentally cleaner electricity generation and energy efficiency. Deregulation of the electricity industry threatened to tear this house of cards down. As long as the Sierra Club and other groups were happy. Integrated Resource Planning (IRP). Jane conjectured that one of the driving forces behind deregulation was to do away with utility requirements that were designed to protect environmental quality. including 13.100 What outcomes did your organization want to attain from the California electric utility restructuring policy formulation process? According to Jane. a policy decision that is widely viewed as a financial 100 CPUC Renewables Working Group. “an independent nonprofit public interest organization which works on issues where science and technology play a critical role. Byron Sher was fine.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Interview #2 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 #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 .How much of what you wanted was in AB 1890? INVESTOR-OWNED ELECTRIC UTILITIES Pacific Gas & Electric San Diego Gas and Electric Southern California Edison MUNICIPAL ELECTRIC UTILITIES California Municipal Utilities Association .Interview #2 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 . California Institute for Energy Efficiency Total note: 1 selects column Rather Little Mixed/Unclear Most 0 0 3 1 1 1 0 2 0 1 1 0 0 2 1 1 1 1 3 1 1 1 1 1 0 0 1 1 1 1 1 1 1 4 1 1 1 1 1 1 .Interview #1 Natural Resources Defense Council . 0 0 1 0 1 1 3 9 10 ERG Master’s Project Mark Stout 160 .

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

000 $1.000 $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.495 $7.995 $21.000 $3.191 $2.000 $2.896 $3.000 $2.Appendix E: Restructuring Stakeholder Campaign Contribution/Gift Analysis Detail Table 1: Assemblymember Jim Brulte.) California Independent Oil Marketers Association Chevron (CMA member) Mobil Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $22.000 $0 $0 ERG Master’s Project Mark Stout 162 .000 $3.000 $4.495 $1.495 $10.000 $1.800 $1.500 $1.995 $300 $12.429 $498 $1.000 $1. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.500 $22.000 $7.000 $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 $3.

750 $4.500 $6.995 $2.000 $1.990 $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.500 $1.995 $1.017 $749 $750 $3.000 $2. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS Adams Steel California Manufacturers Association California Mining Association PAC California Steel Industries (CLECA member) Fontana Steel Mitsubishi Cement (CLECA member) National Cement (CLECA member) Riverside Cement (CLECA member) Southwest Portland Cement Co.000 $1.995 $14.500 $47.000 $1.000 $8.250 $2.511 $3.000 $10.495 $4.995 $0 $0 ERG Master’s Project Mark Stout 163 .) 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 $800 $498 $200 $9.000 $3. (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $2. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades INDEPENDENT PRODUCERS CalEnergy Co.Table 2: Assemblymember Jim Brulte.460 $200 $500 $750 $2.500 $1.

1995/1996 Stakeholder Gift Information for Assemblymember Jim Brulte In 1995.250 $500 $1.000 $3.000 $1. as well as an event. and Privatization” visiting London. Mobil treated Brulte to a $60 event in 1996. Sweden. 4 ERG Master’s Project Mark Stout 164 . Chevron treated Brulte to two meals.000 $1. CFEE is a “non-profit. 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.500 $1. by the California Foundation on the Environment and the Economy.750 $3.750 $750 $1. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co. (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. and Budapest. Paling in comparison. Brulte was taken on a $7.750 $2.000 $1. 1996. From 3/28/96 to 4/8/96. totaling $101. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure103. Not to be outdone. AB 1890 author Assemblyman Jim Brulte accepted no gifts from stakeholders.000 $2. Conservation. Table 3: Senator Steve Peace.490 “Travel project to Europe on Electric Restructuring.000 $2.000 $750 $0 $0 103 Asmus.

Table 4: Senator Steve Peace.000 $4. 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.600 $2.450 $7.250 $1.750 $0 $0 ERG Master’s Project Mark Stout 165 .) California Independent Petroleum PAC Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $48.000 $300 $1.500 $3. (geothermal) California Solar Energy Industry Association Cannon Energy (windpower) Destec (gas-fired) Independent Energy Producers Pacific Lumber Company (solid fuel biomass) SeaWest Windpower Zond Windpower DSM ENERGY SERVICE COMPANIES (ESCOS) SESCO (energy services) LARGE ELECTRICITY CONSUMERS California Manufacturers Association California Retailers Association California Steel Industries (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.050 $3.250 $750 $500 $1.072 $2.500 $16.250 $7.000 $6.115 $18.100 $2.000 $500 $2.250 $2.000 $750 $750 $750 $1. Brotherhood of Electrical Workers (various locals) Southern California Pipe Trades Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.815 $750 $6.572 $1.500 $8.000 $1.

while Edison treated him to five meals and a sports event. SDG&E had Peace out to six meals.000 Table 6: Senator Byron Sher. Table 5: Senator Byron Sher.900 . In 1996. as well as chair of the Senate Energy and Utilities Committee. Peace began a practice of reimbursing all utilities for meals and outings starting with Edison in 1995. In 1995.100 $2. 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. he maintained a pretty low profile in 1995 and 1996 in terms of accepting gifts and trips. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES Southern California Edison/Edison International UTILITY LABOR UNIONS California State Pipe Trades Council PAC INDEPENDENT PRODUCERS Indpependent Energy Producers LARGE ELECTRICITY CONSUMERS SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES California League of Conservation Voters $500 $500 $500 $500 $500 $500 $0 $0 $5. Peace was treated to a $52 sports event by Mobil Oil. SDG&E pulled on Peace’s ear over a sports event and meal totaling $89. taking Steve to 11 meals. Southern California Edison was granted a high level of access. IEP made a gift of $241 for his speech at a conference.450 166 ELECTRIC/GAS $6.000 $5.1995/1996 Stakeholder Gift Information for Senator Steve Peace Given Steve Peace’s prominence as chair of the Conference Committee on Electric Utility Restructuring.

100 $500 $2.000 $500 $1.000 locals) Southern California Pipe Trades United Assoc. (biomass) Edson + Modisette (lobbyist for indep. McQuat. Inc (consultants) $200 ERG Master’s Project Mark Stout 167 .600 $13. of Journeymen & Apprentice Underground Utility/Landscape INDEPENDENT PRODUCERS AES Pacific/SF Energy Co.882 $100 $1.482 $100 $1. Brotherhood of Electrical Workers (various $9. (geothermal) Colmac Energy Inc. (gas-fired) American Wind Energy Association Bonnie Hays Consulting (Clean Power Day organizing) CalEnergy Co. EVs) Hansen.000 $500 $500 $9.500 Int. $2.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 $1.000 $100 producers. and Hamrin.

000 Large Energy Consumers $3.250 $100 $50 $500 $500 $250 ERG Master’s Project Mark Stout 168 .000 $100 $1.000 $1.500 COMPANIES $1.000 $100 $100 $500 $1.Indpependent Energy Producers Modesto burning) SeaWest Windpower United American Energy Wadham Energy Limited Partnership (biomass) Zond Windpower DSM ENERGY SERVICE Energy Limited Partnership $1.000 $1.250 (ESCOS) Appliance Recycling Centers of America Onsite Energy (energy service company) Preferred Energy Services (energy service company) LARGE ELECTRICITY CONSUMERS Adams Steel California Association California Retailers Association California Steel Industries (CLECA member) Louisiana Pacific (CMA member) Schnitzer Steel Industries (CLECA member) OIL AND NATURAL GAS COMPANIES $1.000 (tire $1.

California Institute for Energy Efficiency California Integrated Waste Management Board (biomass proponents) Nevada Community Action $1.000 $300 $300 $22.462 $100 $900 $400 $500 ERG Master’s Project Mark Stout 169 . of California.585 $100 $500 $2.448 $14.Tosco Corp. (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.000 $700 $4.

totaling $758.300 $500 $1. Table 7: Senator Bill Leonard. Mobil. Sher received no other gifts that year from energy utility stakeholders. 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 $3.000 $1. but his Statement of Economic Interest reveals large holding of oil and electricity stocks. and GE. totaling $2608.000 in each of Amoco. the National Association of Regulatory Utility Commissioners (NARUC) bought Sher two plane tickets for quick trips to the Steering Committee meetings of the Electric Utility Restructuring Project. Sher holds over $100. In 1996.400 $750 $150 $1.500 $300 $0 $0 $2.1995/1996 Stakeholder Gift Information for Senator Byron Sher In 1995. NARUC treated Sher to a two day trip to DC for another meeting. Exxon.500 $0 $0 ERG Master’s Project Mark Stout 170 .

000 $2.730 $2.) Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $19.000 $2. Edison again ERG Master’s Project Mark Stout 171 . Edison’s lobbyists got to spend a little more quality time with Leonard for their money. SCE treated him to a $30 beach party and a $20 lunch with lobbyist Bob Foster. for a paltry $20.650 $2.080 $10.000 $2. SDG&E bought Leonard a $125 ticket to the Pete Wilson Inaugural Gala.000 $5.650 $500 $1. The Pacific Rim Conference of Seattle. While the Senator was there. Senator Leonard was courted a little more heavily by energy stakeholders in 1996. SCE treated Leonard to dinner and lodging for Legislative Ski Day. saving up for a $77 dinner with head lobbyist Bob Foster. (CLECA member) California Steel Industries (CLECA member) Mitsubishi Cement (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.000 $1. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.500 $500 $1.000 $500 $500 $4.000 $0 $0 1995/1996 Stakeholder Gift Information for Senator Bill Leonard In 1995. WA paid $734 for Leonard to moderate a conference session on utility deregulation. extending his stay from 12/8/96 to 12/13/96. (geothermal) Pacific Lumber Company (solid fuel biomass) LARGE ELECTRICITY CONSUMERS California Mining Association PAC California Portland Cement Co.000 $1.500 $150 $500 $3. and a $75 dinner at the American Legislative Exchange Council’s annual meeting. 1996 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS Int.Table 8: Senator Bill Leonard.

including lunch with Bob Foster.750 $1.250 $1.000 $1. ARCO treated Leonard to a $19 meal at a reception. for the modest tab of $56.250 $750 $0 $0 ERG Master’s Project Mark Stout 172 .000 $1.600 $750 $750 $500 $1.) Chevron (CMA member) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $6. PG&E took Leonard out to a Kings game. They also had Leonard out for two meals in Sacramento. paying $44 for two meals and lodging.000 $750 $750 $650 $150 $500 $3.000 $1. 1995 Campaign Contributions INVESTOR-OWNED ELECTRIC/GAS UTILITIES El Paso Natural Gas Joint Electrical Industry Fund Pacific Gas & Electric San Diego Gas and Electric/Enova Southern California Edison/Edison International Southern California Gas/Pacific Enterprises UTILITY LABOR UNIONS California State Association of Electrical Workers INDEPENDENT PRODUCERS Indpependent Energy Producers LARGE ELECTRICITY CONSUMERS Adams Steel Louisiana Pacific (CMA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.had Senator Leonard out for Legislative Ski Day.600 $1. Table 9: Assemblymember Mickey Conroy.

the California Foundation on the Environment and the Economy took Conroy on an 11 day.050 $1.000 $500 $750 $250 $500 $2. 4 ERG Master’s Project Mark Stout 173 . two meals for $44. charitable organization 501(c)(3)” funded by Edison to push Edison’s preferred wholesale PoolCo style market structure104. and Inner Mongolia. Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $9. (CLECA member) California Steel Industries (CLECA member) Louisiana Pacific (CMA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.600 $500 $1.000 $2.300 junket to talk with Chinese central government and provincial leaders in Beijing. $7.600 $3. CFEE is a “non-profit.000 $5.000 $3.Table 10: Assemblymember Mickey Conroy. PG&E treated him to a basketball game with $51 tickets. Shanghai.000 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Mickey Conroy In April of 1995.) California Independent Petroleum PAC Chevron (CMA member) Southern Counties Oil Co. 1996.700 $750 $450 $250 $250 $1.000 $500 $2. and to 104 Asmus.700 $500 $300 $550 $2. 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. 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.500 $2.

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

750 $2.750 $2. Brotherhood of Electrical Workers (various locals) INDEPENDENT PRODUCERS CalEnergy Co.000 $1.Table 11: Assemblymember Diane Martinez.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.750 $1.675 $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. (geothermal) Indpependent Energy Producers OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.250 $1.750 $750 $500 $500 $750 $0 $0 ERG Master’s Project Mark Stout 175 .750 $1.750 $4.000 $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 MUNICIPAL ELECTRIC UTILITIES Gualco Group (lobbyist: Imperial & Modesto Irigatn.000 $7. (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. Dist.000 $4.500 $1.000 $1.000 $1.000 $500 $3. (member of IPPs of NY) Zond Windpower LARGE ELECTRICITY CONSUMERS California Manufacturers Association California Portland Cement Co.) UTILITY LABOR UNIONS California State Association of Electrical Workers Int.000 $500 $500 $5.250 $1.) Chevron (CMA member) Mobil Texaco Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $20.000 $4. Brotherhood of Electrical Workers (various locals) Utility Workers Union of America INDEPENDENT PRODUCERS CalEnergy Co.500 $6. (CLECA member) California Steel Industries (CLECA member) Tamco Steel (CLECA member) OIL AND NATURAL GAS COMPANIES ARCO (Atlantic Richfield Co.500 $1.500 $1.500 $500 $500 $1.000 $500 $1.000 $1.000 $500 $500 $500 $500 $500 $3.000 $0 $0 ERG Master’s Project Mark Stout 176 .Table 12: Assemblymember Diane Martinez.000 $5.500 $1.750 $1.

208 $0 $0 $1.850 $1.Table 13: Assemblymember Steve Kuykendall.600 $1. (bulk terminals) Mobil Tidelands Oil Tower Energy Group (oil. the Illinois Energy Association flew Martinez out for a $1.000 $500 $500 $1. ERG Master’s Project Mark Stout 177 .467 trip to Northwestern University to discuss the deregulation of public utilities. diesel) Unocal (CMA member) SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $7.000 $8. natural gas. 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.600 $500 $0 $0 1995/1996 Stakeholder Gift Information for Assemblymember Diane Martinez In 1995.000 $1.500 $1.058 $500 $500 $1.100 $100 $1.) California Independent Oil Producers Chevron (CMA member) Kaiser International Corp. The Assemblymember enjoyed no such gifts from deregulation stakeholders in 1996.900 $3.500 $1.

However. Kuykendall’s social calendar was destined to pick up in 1996. ERG Master’s Project Mark Stout 178 . and Budapest. 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.500 $1. diesel) Unocal (CMA member) Victory Oil Co.374 $500 $2.374 $4. natural gas.350 $500 $1.989 $500 $500 $0 $0 1995/1996 Kuykendall Stakeholder Gift Information for Assemblymember Steve In 1995. Sweden. and Privatization” visiting London.) California Independent Oil Producers California Independent Petroleum PAC Chevron (CMA member) Mobil Texaco Tidelands Oil Tower Energy Group (oil.Table 14: Assemblymember Steve Kuykendall.000 $500 $2.254 $200 $500 $4. From 3/28/96 to 4/8/96.000 $1.250 $100 $500 $35.000 $19.490 “Travel project to Europe on Electric Restructuring. Western States Petroleum Association treated Kuykendall to a reception and a dinner totaling $62. SMALL ELECTRICITY CONSUMERS ENVIRONMENTAL ADVOCATES $10.000 $2.500 $1. Conservation.000 $1. Kuykendall was taken on a $7.500 $0 $1.000 $1.443 $6.

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

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

000 in each of Chevron. Jr. He does own more than $10. He left office on February 23. and Paris. 1994/1995 Stakeholder Gift Information for Commissioner Josiah Neeper Knight did not report any electricity deregulation stakeholder gifts in 1994 or 1995. was very interested in California moving to the UK-style.1994/1995 Stakeholder Gift Information for Commissioner Gregory Conlon From 3/16/94 to 3/31/94. Conlon was taken on a $7. He does own less than $10.000 in each of Montana Power Company and Exxon stock. 1994/1995 Stakeholder Gift Information for Commissioner Henry Duque Duque did not report any electricity deregulation stakeholder gifts in 1994 or 1995. and environmental groups to discuss the British experience with deregulation of electricity. In 1995. 1994/1995 Stakeholder Gift Information for Commissioner Jesse Knight. by the California Foundation on the Environment and the Economy. Edison.167 junket visiting London.000 in each of Central & Southwest Corp. regulators. ERG Master’s Project Mark Stout 181 . one of CFEE’s funders. wholesale PoolCo model. Unocal. utility and General Electric stock. the Northwest Electric Light and Power Association flew Shumway to their 3rd annual Non-Utility Generation Conference. Knight did not report any electricity deregulation stakeholder gifts in 1994 or 1995. government ministers. PG&E had him out to three meals for $71. to meet with CEOs of the electricity industry. 1994/1995 Stakeholder Gift Information for Commissioner Norm Shumway In February of 1994. The Edison Electric Institute spent $279 to fly the Commissioner to a conference on the results of State Competition in Boca Raton. and Schlumberger oilfield services stock. spending $258. and less than $10. 1995. Brussels.

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