PG&E watch: The rate hike, the LNG pipeline and the $82 million corporate giveaway

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By Rebecca Bowe

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Image courtesy of TURN

Pacfic Gas & Electric Co. collected $82 million from the state last year as a reward for running energy-efficiency programs, even though an independent verification report conducted by the California Public Utilities Commission showed that the utility failed to reach target goals for curbing power usage.

In addition to the $82 million bonus, PG&E and other utilities received millions in ratepayer dollars to administer the energy-saving programs. But under utility management, large portions of these energy efficiency funds go to administrative costs, leaving less for actual energy-reducing measures. The funds are derived from fees on ratepayers’ utility bills. And despite its past failure to meet the goals, PG&E is asking for even more money on the next round.

Groups like The Utility Reform Network (TURN) and Women’s Energy Mattters (WEM) have long advocated for independent administration of energy-efficiency programs, citing evidence that nonprofits have had better performance at the helm, with lower administrative costs and greater success at curbing electricity consumption.

On Tuesday, members of the public -- who foot the bill for these programs -- will get a rare opportunity to weigh in on how their money is spent.

A “Public Participation Hearing” (PPH) will be held at the California Public Utilities Commission (CPUC) in San Francisco to discuss energy efficiency spending. The meeting is scheduled for 2 p.m. on July 28th at the California Public Utilities Commission, located at 505 Van Ness Ave. in the Auditorium.

TURN is asking public participants to request the following:

1) Ordering [utility companies] to spend at least 75% of Energy Efficiency funds for home energy audits, weatherization and other programs that create green jobs and community investment.
2) Ordering [utility companies] to spend no more than 25% of energy efficiency funs on stockholder bonuses, administrative overhead and multi-million dollar executive salaries.

WEM, on the other hand, goes even further, urging public participants to tell the CPUC to take the energy efficiency programs out of the utilities’ control and hand them over to an independent entity instead.

“It is critical that we urge the CPUC to let local governments run independent energy efficiency (EE) programs since the utilities are not running them in a responsible and effective manner,” stated Barbara George, Executive Director of WEM. “CPUC should suspend the current system of utility profits on energy efficiency pending an in-depth investigation. PG&E has been using public energy efficiency dollars as a political slush fund. WEM has attended and videotaped meetings in Marin where PG&E executives offered special deals on energy efficiency and solar in return for elected leaders voting to deny their citizens the choice of cleaner, cheaper, locally-controlled power under Community Choice.”

Another PG&E related pitch has gone out on behalf of the Sierra Club and OurCity, urging support for a proposed Board of Supervisors resolution that would condemn the utility’s partnership in the Pacific Connector, a 250-mile liquid natural gas pipeline that would run from Oregon to California.

Supervisor Chris Daly has placed an item on the SF Board of Supervisors "adoption without committee reference" agenda for the July 28 Board meeting urging PG&E to withdraw from the project partnership.

The proposed resolution notes that a LNG import terminal associated with the Pacific Connector would pose a safety hazard for17,000 people in the communities surrounding Coos Bay, Ore. The terminal development would also permanently destroy 2,000 acres of forested area and watershed that provide critical habitat for the spotted owl, marble murrelet, and coho salmon. The resolution questions the need for the Pacific Connector, and points out that adding imported LNG would result in a significant net increase of greenhouse gas emissions in PG&E’s natural-gas portfolio.

Amid all of this, a new PG&E rate hike may be on the horizon. The utility recently submitted a request to the CPUC seeking a rate increase averaging 6.5 percent by 2011, the Sacramento Bee reported recently, which would drive up residential electricity rates an average of 8.3 percent, and business rates by 3.3 to 5.4 percent. “The Sacramento Municipal Utility District's board recently approved an across-the-board 13.5 percent residential rate hike to be phased in over the next 18 months,” the Bee noted. “SMUD's rates, however, will remain significantly lower on average than PG&E's.”