Move by big three utilities to tilt the playing field in their favor

IOU “Code of Conduct” under attack

The original Community Choice law in California, AB 117 (2002), required the big electric utilities to “cooperate fully” with local governments evaluating Community Choice. The experience of the first cities and counties to pursue Community Choice made it painfully clear that the utilities did not seem to understand what “cooperate fully” meant. SB 790 (2011) was enacted to spell it out for them, and to put a harness on any future utility skulduggery (I’ll get to what that was momentarily). SB 790 established a “Code of Conduct” for the utilities relative to newly emerging Community Choice agencies (CCAs). It was very much needed, there was a very sound reason why it came to be, and it has been working well, for the most part. It should be left as it is.

On January 30, the big three utilities in California, Pacific Gas & Electric, Southern California Edison, and San Diego Gas & Electric, filed a joint petition that strikes at the heart of the the code of conduct. Technically, it is a petition for modification of Decision 12-12-036, a 2012 CPUC Rulemaking decision that refined the Code of Conduct.

In the filing the utilities are asking the CPUC to:

  • Allow them to communicate with local governments regarding CCAs
  • Allow them to communicate with the news media — newspapers, television, and radio stations, about emerging CCAs.

That might sound reasonable to someone who doesn’t know the history. But here is what happened: In the mid-2000s the cities and counties in the San Joaquin Valley, Marin County, and San Francisco, embarked on the first early efforts to exercise the newly established authority of local governments to form Community Choice Aggregations. They were met with an onslaught of marketing, legal, administrative and ad hominem attacks carried out by PG&E. In Marin County alone it is well-known that PG&E spent about $4M in an attempt to stop Marin Clean Energy from ever forming. The campaign included mailers, phone calls, meetings with elected leaders in all cases promulgating unfounded speculation about lights going dark, skyrocketing rates, incompetent elected leaders, and more. It poisoned the community with distortions, inaccuracies, and flat out lies. This is the kind of communication the IOUs are now trying to tell us is in the public interest?

In the aftermath of the blatant obstruction of the pioneering efforts of the San Joaquin Valley, Marin County, and San Francisco, State Senator Mark Leno chaired a series of Senate Select Committee meetings on Renewable Energy in 2010, specifically to hear the stories that these cities and counties could tell about their efforts and about the behavior of PG&E in this context. It was this series of hearings that led to the introduction, robust debate, and ultimate enactment of SB 790 and the Code of Conduct.

Now the utilities claim:

  • That lifting these restrictions will advance the public interest, will be consistent with California law, and is necessary to ensure that the code complies with the U.S. Constitution.
    • Response: Evidence has shown that the public interest will not be served; SB 790 is California law; First amendment rights were amply debated and the ability to file marketing plans under the law allows for the utilities’ constitutional speech.
  • That their goal is not to prevent CCA formation, and that they support customers’ right to choose CCAs.
    • Response: There is a long history of IOU obstruction of CCA clearly intended to prevent CCA formation.
  • That they do not seek any changes to the code of conduct’s marketing provisions, which restrict their ability to communicate with customers regarding the utility’s and CCAs’ energy supply services and rates
    • Response: They would not need any changes to the marketing provisions if they get the other restrictions lifted; they will do their marketing in the media, as they did in the past.
  • That the petition only concerns communications with local governments and the media.
    • Only? That is the core of what is effective about SB 790. With free range to spread misinformation to local governments and the media, the IOUs won’t need anything else to begin crushing community efforts to chart their own energy destinies.

It doesn’t work for the utilities to say they have turned over a new leaf. Recent experience in San Diego, the only instance in the state where a utility, in this case, SDG&E, has filed a marketing plan under SB 790, is outlined in our November 29, 2017 webinar, The San Diego Challenge. The activity underway there is clearly not in line with the spirit if not the letter of SB 790.

The utilities have asked that the CPUC take prompt action on the petition according to the following tight schedule:

  • Responses to petition are due: March 1, 2018
  • The Joint Utilities’ reply to responses is due: March 12, 2018
  • Proposed Decision to be issued: June 1, 2018

Email your comments to the CPUC at:  And urge your local elected officials and/or Community Choice agency to work with the California Community Choice Association to mount a forceful response.

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