On Sunday, the Los Angeles Times laid a challenge right at the door step of the California Legislature. Ivan Penn's article about the billions ratepayers have overpaid for their electricity due to construction that has not proven useful to ratepayers cries out for a legislative fix to restore the doctrine of "used" and "usefulness" for new projects.
Ratepayers, for example, are very likely to pay the $200 million cost of an expansion in Aliso Canyon, even though it may never go online and be useful to ratepayers. Prior to the Public Utilities Commission's corruption era, headlined by PUC President Michael Peevy, now under criminal investigation, utility projects had to undergo the "used and useful" test before ratepayers paid the bill.
Following the electricity crisis, State Senator Rod Wright passed legislation to allow for ratepayers to be billed in procurement decisions regardless of the usefulness of the project to ratepayers. The overture to utility investors on Wall Street, stinging from the electricity crisis, was only half the puzzle. Peevey's PUC, through an exploitation of its authority, abandoned the "used and useful" doctrine in other utility decisions, effectively giving the utilties automatic debit authorization to bill ratepayers even if projects, like the San Onofre Nuclear Operating Station, went off the rails.
Senator Wright was convicted of voter fraud for living outside of his Senate district. Peevey's pandering to utility lobbyists, and his outright extortion of the companies, is the subject of criminal investigation. The ugly details, part of the public record, have the makings of a Hollywood movie and are our inspiration for creating the www.PUCpapers.org.
Isn't it time for the legislature to roll back the era of corruption at the PUC and require utilities to prove projects' usefulness before billing ratepayers? It's a challenge that a legislature, stinging from corruption scandals far beyond Wright's, must answer if it is to restore the public's faith in it, as well as the PUC.
