Don’t be surprised if the California Public Utilities Commission is soon put in charge of making the Oakland Raiders winners again, or managing Kanye’s award show appearances.
After all, the PUC already has responsibility for almost every other difficult California problem.
Are we asking too much of the PUC? Perhaps, but this is how things are in a state whose leaders routinely dodge the most complicated challenges. The PUC is full of technically proficient people, from engineers to scientists to judges, who are accustomed to getting blamed when they can’t resolve the impossible problems we send their way.
California leaders’ preference for the PUC as solvent for bureaucratic clogs was the little noticed subtext of the recent debate over the wildfire legislation AB 1054. While media and politicians debated whether the new law was a bailout for utilities, the legislation’s details were all about giving the PUC the thankless job of inventing a complex new regime for the prevention and costs of wildfires.
Such transfers of responsibility to the PUC are justified by politicians’ lack the technical expertise of the PUC. But there are other reasons too. Companies, particularly in telecommunications, find it more efficient to be regulated by one statewide entity than by California’s myriad local governments. And politicians appreciate how the commission, by taking on hard questions, absorbs criticism that might otherwise be directed at elected officials.
There are some rewards for playing the punching bag. With its vast portfolio and its bottomless tolerance for political pain, the commission, its five members appointed by the governor, has become the most powerful regulatory entity in a regulation-mad state. It has grown into a decentralized agency with 1,300 employee positions and more divisions than the Marines and Major League Baseball combined.
And it’s becoming even more powerful, since its responsibilities—telecommunications, electricity, gas, water, passenger transport, and rail safety—overlap with the two greatest forces altering California life: the digitalization of everything, and climate change.
While the size and reach of today’s PUC is new, the commission has always been central to modern California’s story. The commission was established by the voters in the same historic 1911 election that introduced other Progressive reforms, including the ballot initiative process.
The commission was conceived as a new regulatory check on the power of the railroads. But it only took a few years to expand its authority to natural gas, electricity, telephones, water, cars, and trucks.
In the post-war era, the PUC extended its power to regulating new communications industries, and in recent decades it has become a protector of consumers and of public safety—especially after the deadly 2010 explosion of a PG&E gas pipeline in San Bruno.
The PUC has long faced criticism for favoring the utilities it regulates. Earlier in this decade, a public scandal erupted when federal and state investigations showed inappropriately close communication between then PUC President Michael Peevey and PG&E.
But even as California leaders urged audits and reform for PUC, they kept adding to its duties. After last year’s deadly mega-fires, including the one that destroyed Paradise and was linked to a PG&E transmission tower, the response in Sacramento was to house a new wildfire safety division at the PUC, at least temporarily.
Running this commission, one assemblyman has said, is like “managing a lion.” That’s an understatement. When the current PUC president, Michael Picker, widely praised for restoring credibility for the PUC, announced his retirement, the San Francisco Chronicle asked if he had enjoyed the work. Picker replied: “It’s the most frustrating job I’ve ever had. Not the worst—I worked for a meat packer picking up dead cows once.”
Gov. Gavin Newsom announced he would replace Picker with Marybel Batjer, who handled thorny problems for both Jerry Brown and Arnold Schwarzenegger. But this will be thornier. It would be hard enough to run the PUC as it exists now. But with a six-year term, Batjer will soon be overseeing a PUC that must do even more as it tries to keep up with California’s many inventions.
Figuring out how to better regulate a regulator that regulates almost everything is the supernova of problems. The PUC’s portfolio should be narrowed, and its structures made more democratic. But if you asked the governor and the legislature to take on such reforms, they’d probably just kick the task back to the PUC itself.
Joe Mathews writes the Connecting California column for Zócalo Public Square.