There's a pony somewhere in PG&E's pile of state rate-distribution manure
This is in reply to the March 6 Community Voices article by Alan Zaremberg, CEO of the California Chamber of Commerce, "Prop. 16 would force cities to think." PG&E has long been his largest and most reliable dues-paying member. He must be a happy man. Pacific Gas & Electric Co., perhaps not so much.
The same week that Zaremberg's article appeared in The Californian, PG&E CEO Peter Darbee was telling an investor conference in New York that the idea behind Proposition 16 is to "greatly diminish" those pesky voter efforts to find new electricity providers.
Maybe Zaremberg didn't get the memo.
In banging the drum for PG&E's blatant attempt to cement its monopoly into the California Constitution through Proposition 16, Zaremberg blew hard on the trumpet of giving the voters the final say over who provides their electricity. Ironic that a surprise confession by PG&E's local representative just prompted Kern County supervisors to unanimously place an advisory question on the November ballot concerning PG&E's future role in this community.
"Kern County customers are being impacted with high costs and are subsidizing other areas of the state," PG&E's Ken Cooper told the supervisors. The Californian reported that the "blunt acknowledgment that PG&E rates are unfair left many observers stunned." ("PG&E agrees local rates are unfair," March 3.)
Within days, PG&E's Senior Vice President for damage control, Tom Bottorff, wrote a March 8 Community Voices article, "PG&E's proposal to reset residential rate tiers assigns costs more equitably," trying to get the horse back in the barn. "This is not a situation of Kern County versus the Bay Area," he wrote.
A hypothetical customer along the coast using 1,000 kwh in a summer month would pay $317.24, according to Bottorff, while a Kern County customer using the same amount would only pay $159.48. "In fact, Kern County households in 2009 paid a lower average rate than households did, on average, in the rest of PG&E's service territory." And there's a pony in that pile of manure somewhere.
While PG&E struggles to get its story straight, it ought to answer two basic questions about Proposition 16: First, how will restricting customer choices of electricity providers -- its sole acknowledged purpose -- bring PG&E rates down in Kern County? Most Americans are deeply imbued with the belief that competition brings lower prices. Did somebody exempt electricity from laws of supply and demand?
And second, where did PG&E -- the only financial contributor to Proposition 16 -- find the $35-plus million to spend on this propaganda campaign to mislead the voters? The California Public Utilities Commission is supposed to set PG&E's return on equity at the level that will produce investment capital for necessary new infrastructure. Generating a political slush fund is not supposed to be part of the process.
The undisputed facts are that PG&E currently charges its residential customers a top rate of 49 cents, compared (according to the Kern Taxpayers Association) to 34 cents for Southern California Edison and 17 cents for the Los Angeles Department of Water and Power. PG&E has confirmed KernTax's data.
Then again, these scorched-earth battles between investor-owned utilities and their customers don't seem to take place within the Southern California Edison service territory. Maybe that's why SCE hasn't found it necessary to sponsor deceptive ballot measures or put a single nickel into supporting Proposition 16.
Supervisor Jon McQuiston got it right when, as quoted in that March 3 article, he told PG&E, "If (the rate structure) is unfair and unjust, I can't reconcile why (PG&E) would spend $36 million to make it harder for people to solve it locally. It's almost like talking out of two sides of your mouth."
Get ready for a lot more. Word is that PG&E is about to launch its massive, carpet-bombing, round-the-clock, saturation advertising blitz for Proposition 16. To paraphrase Zaremberg, that will force people to think.
John Geesman served on the California Energy Commission from 2002 to 2008.
