Just like yesterday
Then I'll get on my knees and pray
We don't get fooled again
Don't get fooled again
No, no
At the end of most legislative sessions there is a big special interest power grab hanging in the balance. The biggest this year may be a long-time wish list item of the utilities and energy sector: connecting California’s state electricity system to a Western grid.
It’s an idea first introduced and authorized during electricity deregulation, that great moment in California history when Enron and the like showed us how naïve our politicians and policy wonks could be, and how we had to endure blackouts if we didn’t pay their price.
The stage is being set for another swindle of the consumer and the environment by some of the same cast of characters who took the state to the cleaners the first time.
What the utilities and energy sector sees is another opportunity for deregulation. The Western grid, long the manifest destiny of an energy sector seeking opportunities to “arbitrage” electricity again, after the failed deregulation disaster of the turn of the century, is a way around California law, such as it is.
In a California-mostly grid, which we have now, California law rules – the legislature’s and the Public Utilities Commission’s. In a Western interstate grid, it’s the Wild West where the Federal Energy Regulatory Commission, or FERC, has final say. And FERC makes the stacked California PUC look like wild eyed socialists. It’s fully rigged by utility companies and energy insiders.
In such an interstate Western system, interstate commerce gets the utilities and generators beyond California law. That’s helpful when the main grid backer, Warren Buffet’s PacifiCorp, has a 60% coal portfolio and California claims to have a “renewable portfolio standard.”
Who’s pushing the plan? Governor Brown and his energy regulators, many of whom made their bones in the deregulation debacle.
Brown’s Cal ISO issued an uncritical cheer-leading report for the Western grid, set up by eleventh hour Brown-backed amendments to SB 350 last year. CAISO is full of old industry hands. For example, Brown’s ISO appointee Mark Ferron was on the Deutsche Bank energy trading desk during the electricity crisis.
Brown’s California Energy Commission chair and Western grid booster Robert Weisenmilller was a consultant to energy companies during deregulation (including former PUC chief Mike Peevey's) who explained how to game the deregulated system. Then there’s Nancy McFadden, Brown’s top aide, who spent the electricity crisis as utility overseer under Gray Davis, before becoming Sr Veep at PG&E.
Will the legislature be fooled again?
Big, bad things usually happen in the last days of the legislature. This time there’s no good reason to rush, other than pressure from Brown and the utilities, and fear that scrutiny will lead to more questions than answers.
After California recovered from the electricity crisis debacle, bucking up utilities and giving them back an electricity generation portfolio, the companies were given a green light to overbuild capacity on the backs of the ratepayers. California is way overcapacity in electricity. The scam of the century was accomplished under a PUC dominated by former president Michael Peevey, now under criminal investigation for turning the keys over to the utilities, from which he once hailed as Edison’s chief.
We have way too much electricity. The utilities know that their gravy train in building more natural-gas powered electricity plants at ratepayers expense, the boom of the century under Peevey in the wake of San Onofre’s closure, will end without a bigger Western market.
Ratepayers shouldn’t be paying for more power plants, particularly fossil-fuel powered natural gas ones. We don’t need more electricity given the glut of rooftop solar, which is not adequately counted in the utility-skewed renewable portfolio standard Brown signed last year.
Brown, the utilities and their well-paid allies in the legislature are hoping for an end of the session score before the public knows what hit them. The Western grid is the new electricity deregulation. If legislators fall for it, the vote will be on their records forever, just like the last generation of legislators, who followed former State Senator Steve Peace’s sop to the deregulated energy sector into the dark of California blackouts.
