Questioning Prop. 16

The bill vs. CCAs

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rebeccab@sfbg.com

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.