potrero view

March 2010

Editorial: Pacific Gas and Electric Grabs for Power

Published by The Sacramento Bee January 19, 2010

Pacific Gas and Electric Company (PG&E) spent $3.5 million to collect more than a million signatures to qualify what it calls the Taxpayers Right to Vote Act for California’s June ballot. The self-serving title makes it sound like motherhood and apple pie. It is neither; the opposite, in fact.

If voters approve the measure, it will protect the investor-owned utility from dissatisfied customers angry about bad service and high costs. The initiative makes it virtually impossible for those customers to escape PG&E and create their own public power agency or to be annexed by a neighboring government-owned and operated utility. Under its provisions, a super majority, or two-thirds of the voters, in any jurisdiction would have to approve a proposal to switch from an investor-owned utility and move to public power. Stated another way, one-third of the electorate, a minority, would get to decide this vital issue for the majority.

PG&E’s motives in this effort are obvious. Northern California’s largest investor-owned utility has among the highest electricity rates of any power provider in the country, and those rates will likely go a lot higher soon. Currently PG&E has some 10 rate hike requests worth more than $5 billion pending before the California Public Utilities Commission.  Increasingly, customers straining to pay those high electric bills are turning to public power for relief. PG&E charges its average customers 15.2 cents per kilowatt-hour for electricity. Sacramento Municipal Utility District (SMUD) customers pay 11.4 cents per kilowatt-hour, 25 percent less. Roseville’s rates are comparable to SMUD’s.

In recent years PG&E has spent tens of millions of dollars to fend off efforts by ratepayers in San Joaquin, San Francisco, Marin and Yolo counties who’ve tried to form their own public utilities or annex themselves to public power agencies. If its initiative passes, PG&E won’t have to worry about fighting small battles all over the state. The constitutional amendment makes it virtually impossible for any jurisdiction to escape the PG&E monopoly.  It also makes it difficult for cities that have public power agencies to extend that coverage to areas they annex in the future without going through onerous and expensive public votes. Given the two-thirds threshold they face under the initiative, they would likely lose. It gets worse.

Attorneys for the Northern California Power Agency, the organization that represents public utility districts, say the way the initiative is drafted may prevent public agencies from providing power to a new subdivision, apartment building or business built within their own jurisdictions without first getting a two-thirds vote of approval from the public.

Finally, the PG&E ballot measure is another troubling example of the initiative process going dangerously awry in California, of a powerful special interest seizing the initiative process for its own narrow benefit. The measure the utility is bankrolling is not a simple statute. It is a constitutional amendment. If it passes, it enshrines unfair protections against competition for PG&E, one of the richest, most powerful corporations in the state, into the California Constitution.  

It is unusual for The Bee to come out against a ballot measure before the campaign has really started. The PG&E initiative deserves special attention. It’s that bad.

 

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