Thomas Elias: Signs that nothing will change at corrupt PUC
‘Meet the new boss; same as the old boss,” went the refrain in the 1971 hit record “Won’t Get Fooled Again” by The Who. It’s also a pretty fair description of today’s situation at the California Public Utilities Commission, now staffed partly by new commissioners not present during most of the agency’s debacles of this decade.
Things look very different on the surface in part because the five-member commission now has four female members for the first time since its founding more than 100 years ago.
The trouble is, things really are not very different. This agency, which regulates prices and practices at most of the state’s electric, natural gas, water and some telephone operations, has been caught favoring and colluding with electric and gas companies repeatedly. Many see its rate-setting proceedings as charades akin to a Japanese kabuki dance that features lots of activity, but a predetermined outcome.
The process in the commission’s first major proceeding with two freshly minted members appointed by new Gov. Gavin Newsom, including the agency president, appears pretty much like it’s been during decades of male domination.
The PUC’s newest responsibility is to determine whether customers of California’s three big privately-owned electric companies should pay a monthly fee of about $1.50 each for the next 15 years to put $10.5 billion into the new state Wildfire Fund for payment of utility liabilities in future big fires. In effect, this would continue a charge consumers have paid since 2002 for electricity the state bought during the energy crunch early this century. That charge was supposed to disappear this year. Now it will continue.
Beneficiaries include Pacific Gas & Electric Co., the Southern California Edison Co. and San Diego Gas & Electric Co., all found responsible for starting massive wildfires in recent years.
The legal rub here is that before customers can be dunned, state law requires the PUC to conduct a proceeding to decide whether any new charge is “just and reasonable.”
Yet, the state went ahead and provided a loan of $2 billion to the new fund from money saved up by the California Earthquake Commission via quake insurance premiums paid by policy holders. How earthquake claims would be paid if a major temblor hits during the year or two before that money is repaid by utility customers is a great unknown, but the money nevertheless quickly came out of the state’s Surplus Money Investment Fund.
That transfer pretty much coincided with the PUC setting a date for its required proceeding, and long before any determination that the fee is just and reasonable. In fact, no evidence has even been collected so far aside from governor’s office reports on wildfire costs and liability, which are neither sworn testimony nor other legal evidence of the sort needed in a PUC proceeding.
Essentially, the commission decided before its required proceeding to let the Wildfire Fund have the money and then take it back from electric customers. But it did that without any evidence justifying the move.
This amounts to legally premature “pre-decisional decision-making,” says consumer attorney Michael Aguirre, who recently won back more than $1 billion in consumer funds the PUC had awarded SoCal Edison to pay for decommissioning its defunct San Onofre Nuclear Generating Station.
The seemingly illegal move came after Commissioner Clifford Rechtschaffen, in charge of the required (but apparently greased) proceeding, determined there was no need for evidentiary hearings over the new 15-year charge to consumers.
Aguirre, a former elected San Diego city attorney, argued this demonstrated bias by Rechtschaffen and demanded he be disqualified from the ratemaking proceeding on the new charge. The other commissioners unanimously denied Aguirre’s motion and Rechtschaffen stays in charge of what now looks like the newest PUC kabuki dance.
Essentially, the commission held that because Rechtschaffen has no financial interest in any utility, he should stay. He may have no formal utility stake, but he has a long history of favoring the companies over their customers, including memos he authored on the San Onofre case while still an advisor to ex-Gov. Jerry Brown.
It all adds up to business as usual at the scandal-ridden PUC, despite pledges to change its culture and clean up its act.
Email Thomas Elias at email@example.com. His book, “The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It,” is now available in a soft cover fourth edition. For more Elias columns, visit http://www.californiafocus.net
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