PG&E’s Proposition 16 not winning any early support

Last week the county’s Board of Supervisors and the Sonoma
County Water Agency followed suit by joining nine of Sonoma
County’s city governments in opposing Proposition 16, a measure
added to the June 8 statewide ballot by PG&E to restrict
California cities and counties from getting into the public
electricity and power business.
“Proposition 16 will restrict the county from creating cost
saving energy and water efficiency efforts and would burden local
governments with new costs at a time when we have little
funds,” supervisor Valerie Brown said in announcing the formal
action.
PG&E, the California Chamber of Commerce and other large
investor-owned utilities are supporting Prop. 16 as a safeguard for
taxpayers to control “costly and risky government schemes to take
over local electric service.”
The giant utility has publicly committed $25-35 million of
corporation and ratepayer money to argue in favor of the ballot
initiative.
In this “David versus Goliath” battle, opponents to Prop. 16
have raised only a small fraction of PG&E’s millions. Most of
those funds were raised by The Utility Reform Network (TURN), a
consumer rights group organized two decades ago to fight
PG&E and other utility rate increases and operations.
“It really shows how broken the system is that a corporation can
put an initiative on the ballot and spend however much it
wants,” TURN’s executive director Mark Toney said in a recent press
release.
A PG&E spokesman defended Prop. 16 as an important voter
safeguard. If passed, local governments would be required to win a
two-thirds vote before providing local electricity services or
expanding any existing services. In some cases, Prop. 16 would
require two separate votes, one by the voters in any new territory
to be served and then one by all the voters within the local
government jurisdiction.
One city in Sonoma County —Healdsburg — is taking Prop. 16 as a
very “personal” issue because it has owned its own electric company
for 40 years and is not served by PG&E.
“This is nothing more than a power grab,” said Healdsburg City
Council member Gary Plass.
“In my analysis PG&E is in a position to spend $35 million
to convince voters to pass a state constitutional amendment to
protect their monopoly and to greatly restrict local cities and
counties from seeking attempts to offer lower rates, more efficient
or greener services,” Plass said.
“Prop. 16 takes away the options to deal with our own power
needs as we see fit to address them,” said the water agency’s
Cordell Stillman, capitol projects manager. The county’s water
agency has been producing energy at Warm Springs Dam since 1985 and
is chartered by the state to “buy and sell” power. The agency is
one of 13 local irrigation, public utilities and local governments
that has formed a joint powers authority called the Power and Water
Resources Authority.
“We buy and sell power all over the grid,” said Stillman. “If
any one of our members or all of us decide to add new generating
equipment or some other project, we don’t know how many elections
we might have to have under Prop. 16 to get anything done.”
Ann Hancock, of the county’s independent Climate Protection
Campaign said passage of Prop. 16 could have “huge impacts” on the
county’s efforts to pursue alternative energy programs.
“Prop. 16 would take away the major tool for working on new
energy programs,” said Hancock. “That tool is ‘community
choice.’”
Hancock challenges PG&E’s allegation that the electric
utility business is too complex and risky for small cities or local
governments. “Just look at Healdsburg; they’ve been doing all right
all these years and they have lower rates.”
Plass complains that Prop. 16 is “vaguely written” and could
bear other unknown impacts on existing services like Healdsburg’s
and other new ones such as being proposed in Marin County.
Healdsburg is a member of the Northern California Power Agency
(NCPA), formed over 40 years ago by 15 local governments,
irrigation districts and public utilities. Much of NCPA’s
electricity is steam-generated at The Geysers above Healdsburg.
A proposal by several small governments in Marin County to form
a Marin Energy Authority (MEA) is what many believe has triggered
the $35 million campaign by PG&E to protect its territories,
shareholder dividends and monopoly contracts.
Twice before in recent years, PG&E waged expensive efforts
to stop local governments from entering the energy and electricity
ball game.
In 2006, PG&E spent $10 million in campaign funds to defeat
a community cooperative in Yolo County and in 2008 PG&E spent
almost $13 million to stop an initiative by the City of San
Francisco to compete with PG&E for electric customers.
The North Bay Leadership Council which serves business members
in both Marin and Sonoma counties (including PG&E), opposes the
MEA while offering some support for a similar effort in Sonoma
County, the Sonoma County Energy Independence Program.
Under Prop. 16 both county government-led programs would require
new two-thirds majority elections.
The leadership council’s Cynthia Murray says the MEA would
“create a new unnecessary bureaucracy and add new taxpayer
risks.”
On the other hand Murray said her group has been impressed with
Sonoma County’s Energy Independence Program, as authorized by
AB811, which is giving loans to businesses and homeowners to reduce
greenhouse gas emissions and achieve energy and water
efficiency.
“Sonoma County is leading the way in new energy efficiency
programs which save taxpayer dollars,” said supervisor Brown.
“Another point to consider is that ratepayers that receive
electrical service from public jurisdictions at least have the
opportunity to provide input to the decision makers on proposed
rate hikes.”
Prop. 16 is one of five statewide ballot initiatives on the June
8 primary. Sample ballots are being put in the mail this week by
the Secretary of State.