Travel back in time to the mid-1980s, when California’s insurance rates for both cars and property were nearly the highest in America and climbing fast. Back then, the state insurance commissioner, who could have stopped much of the price acceleration, was appointed by the governor.
Then, in 1988, a consumer group called the Foundation for Taxpayer and Consumer Rights and its leader, attorney Harvey Rosenfield, changed all that. The group ran the Proposition 103 ballot initiative and turned the insurance commissioner into an elected official. Bingo! Since then, California insurance rates have risen slower than those in any other state, but coverage remains as good as anywhere.
The corruption and safety scandals of the last few years demonstrate that it’s high time to regulate utility companies in this state as firmly as insurance companies, and to make utility regulators responsible to the public and the voters just like the elected insurance commissioner.
For today, with California’s electric and gas utility prices eighth highest in the nation, trailing only the inaccessible likes of Alaska and Hawaii, plus a few northeastern states like New York and Connecticut, utility rates are climbing as fast as insurance premiums once did.
No one can doubt anymore that Californians are beset by flawed utility regulation that even now favors big energy distributors over their customers. Corruption scandals come thick and fast for the state’s Public Utilities Commission, with power over both electric and gas rates and the safety of pipelines and power plants.
So this commission has failed abysmally, especially in recent years when lax regulation allowed disasters like the recent months-long methane gas leak at Porter Ranch in Los Angeles, the 2012 failure of the San Onofre Nuclear Generating Station and the fatal 2010 gas pipeline explosion in San Bruno. In each case decided so far, consumers have had to foot most of the bills for the shortcomings and blunders of their energy suppliers.
But Gov. Jerry Brown, who appointed all five present utility commissioners, says not a negative word about his appointees past or present, nor has he tried to rein them in, even after some admitted conflicts of interest. In the last two years, about the only thing he’s had to say about the PUC came when former commission President Michael Peevey left office in disgrace at the end of 2014, just after his collusion with Southern California Edison Co. on who would pay for the San Onofre closure was proven. “At least he got things done,” Brown observed.
Yes, and Benito Mussolini made the trains run on time.
The PUC’s most recent pro-utility move: It refused even to read a request from the Consumer Watchdog advocacy group for a public investigation into the Porter Ranch gas leak, which forced a months-long evacuation of about 4,000 families. This was a blatant violation of the California Constitution, which guarantees the right to petition public officials.
In a sane world, all this would lead to taking the PUC down a peg or three from its exalted position, where members cannot be dismissed even by the governor who appointed them and their decisions can’t be questioned in ordinary courts.
“This is as bad or worse than things were with insurance rates,” says Rosenfield, who still often represents Consumer Watchdog (new name of the outfit he started). “We need to make the PUC accountable to the public and not a puppet of the governor. Commissioners need to understand they work for consumers, not the utilities.”
Added Jamie Court, now head of Consumer Watchdog, “I would like to recall the current commissioners, but that can’t be done. There’s no doubt the corruption at the PUC would not exist if commissioners were elected, or if there were just one elected commissioner.”
So Court says he would support a 2018 initiative making the state’s utility regulator(s) elected, and would run the campaign for it “if we can raise enough money.” He says any such measure, like Proposition 103, would also need to impose other rules to open all records to the public and to make rate-case hearings more accessible.
With a governor unwilling to say, let alone do, anything about the corrupt commissioners he’s appointed, the time has arrived for voters to take things into their own hands.
Thomas D. Elias writes the syndicated California Focus column.