Questioning Prop. 16

The bill vs. CCAs


GREEN CITY In Sacramento, at a Feb. 26 joint legislative committee hearing about Proposition 16, a ballot initiative that Pacific Gas & Electric Corp. plans to sink $35 million into, PG&E executive Ed Bedwell found himself in the hot seat. Sen. Mark Leno and Assembly Member Tom Ammiano, who both represent San Francisco, joined Assembly Member Jared Huffman (D-San Rafael) in grilling Bedwell about an initiative that seems to be aimed directly at the efforts of San Francisco and Marin counties to establish alternative power providers to PG&E.

"What this measure is really about is limiting competition," Leno charged as the hearing got underway. "It's not about anything else, right? In effect, this will do nothing but limit competition."

San Francisco and Marin are both in the process of creating community choice aggregation (CCA) programs, public entities that would offer electricity from clean, renewable technologies. Prop. 16, on the June ballot, would require two-thirds of voters to approve CCAs.

None of the state's other investor-owned utilities have supported into the initiative, but representatives from the California Chamber of Commerce and the California Taxpayer's Association joined Bedwell in testifying in favor of Prop 16.

Bedwell said he didn't believe there is any motive behind it, a statement that prompted laughter from the audience. He argued that Prop. 16 would "give Californians the right to choose who would serve them." He quoted a professor at UC Berkeley's Haas School of Business who said CCA is "fraught with danger" and added, "We couldn't agree more."

But if Prop 16 passes, the likelihood that San Franciscans will be able to choose between PG&E or a power provider that offers 51 percent green electricity will be significantly decreased. And if PG&E rates continue to climb, customers will have no choice but to go along for the ride with this energy monopoly.

Mark Toney, executive director of the Utility Reform Network who testified against Prop. 16, said PG&E has requested rate increases amounting to 30 percent by 2013. In rural communities where unemployment is high and farmers rely on energy-intensive water pumping for irrigation, these ballooning energy costs would hurt the economy.

Michael Boccadoro of the Agricultural Energy Consumers Association, an organization representing 40,000 growers that usually partners with PG&E, testified against Prop. 16. "This will have a chilling effect, not just on CCA, but on the irrigation districts as well," he said. In the midst of a recession, "we're in a very significant water crisis," he said. "Rate increases have a chilling effect on the farming community because we're paying for higher-priced power from PG&E and we have to pump groundwater."

Paul Hauser, representing municipally-owned Redding Electric Utility, testified that if customers in his economically depressed territory were paying PG&E prices instead of the municipal rates, they would pay an extra $440 per year.

"Never ... have I seen political activity by a regulated utility so far outside the bounds of acceptable conduct as PG&E's sole sponsorship of the Constitutional Amendment politely referred to as Proposition 16," said John Geesman, former executive director of the California Energy Commission. Geesman noted that PG&E Corp. derives all its funding from PG&E Co., which is regulated by the California Public Utilities Commission, meaning ratepayer dollars are being siphoned into the $35 million devoted to the Prop 16 campaign.

"It ought to be illegal to take ratepayer dollars and use it against ratepayer interests," Geesman said.

San Francisco Sup. Ross Mirkarimi testified that the opposition could never amass as much funding for a fight against Prop. 16 as PG&E will spend to promote it.


To vote or not has no bearing on the lack of integrity in both of Marin's and San Francisco's CCA plans. The David v. Goliath argument stirs pity for the small, neophyte programs without actually looking into the merits of each. Without a vote, ratepayers are duped into joining (by being automatically opted-in to CCA's) without first being able to make an informed decision through the voting process.

Posted by Guest on Mar. 05, 2010 @ 4:53 am

Living in Marin and working on our CCA I have found that the elected officials have much more of a need to get deeply informed by both sides. The public tends to read an article or two and at this point be bombarded by scary and misleading mailers from PG&E. Because the towns and county are not spending millions on advertising it becomes an unfair fight. And the towns that fell for PG&E courting and promises have been disappointed that the corp is not delivering. Our county Supervisors gave PG&E 3 years to put a plan in writing that could match the rate payer savings and increased clean energy that CCAs have created in other states, and PG&E did not deliver.

Posted by Guest on Mar. 05, 2010 @ 10:12 am

It should be clear to anyone owning PG&E stock that the present management is no longer looking after their interests. I've sold my shares, in part because this insane crusade against the CCA idea that PG&E once supported will affect the bottom line this year. The bigger question is whether PG&E has completely deserted the ideals of corporate responsibility and support for alternative energy it once espoused and thereby lose the support of its customers and the public at large. A utility that alienates both stockholders and ratepayers has an uncertain future.

Posted by Guest on Mar. 05, 2010 @ 2:07 pm

I have a close friend who works for a union. Her sole job is to figure out how much the union must refund members who do not want their dues used for any political purposes, as mandated by the U.S. Supreme Court. Where union membership is compulsory, the court held that it is a violation of a person's First Amendment rights to use dues for political purposes over the objection of that person, because doing so is akin to forcing that person to "say" something (s)he does not believe. We all have to pay PG&E for the necessities of gas and electricity. Can anyone tell me why PG&E is not subject to the same restriction as unions?

Posted by Jeff Hoffman on Mar. 07, 2010 @ 12:16 am