Wining and Dining With Energy Firms Still the Norm for PUC Commissioners

As investigations over alleged back-room dealings at the California Public Utilities Commission continue, Commissioner Mike Florio was wined and dined at a convention for a trade group that represents energy providers. 

Florio was the keynote speaker at the June 25 Western Power Trading Forum convention in Napa, according to the San Diego Union Tribune. Golf, spa, dinner hosted by energy firms, an after-hours reception and a late-night poker game were on the convention’s agenda, according to the newspaper. 

A recently released report revealed that the PUC’s frequent reliance on secrecy was pervasive and flouted existing rules for communications between commissioners, their staff and utilities they were allegedly overseeing.  The independent review, initiated by the PUC and written by Michael Strumwasser and Beverly Grossman Palmer, of the law firm Strumwasser and Woocher, noted that ex parte disclosure notices were, for the most part, a sham. 

Critics of the PUC complained in the report that commissioners were often hosted by utilities and their allies at seminars, sometimes provided at exotic remote locales, and that the commissioners were lectured and beseeched regarding issues directly involved in pending adjudicatory and rate setting cases. Federal and state officials are investigating alleged improper ties between PUC regulators, including former president Michael Peevey, and industry executives.

At an Assembly hearing about the PUC this week, experts indicated that sometimes years of evidence at rate setting hearings were trumped by private one-on-one discussions between PUC officials and some utilities. There was outright violation of the existing ex parte rules by some commissioners and some utilities, badly damaging the commissions’ reputation and credibility – and the culture that existed at the PUC, they said. 

“Even if they were lulled by longstanding commission practice into believing such conduct was technically legal, what so numbed their sense of fairness that, knowing there would be no notice of the communication and, thus, little likelihood of being discovered, they could give one party secret advice in a proceeding then pending before them?” the review stated.  “What made them think this was appropriate conduct for a CPUC commissioner or of a member of a commissioner’s personal staff?”

As for Florio, considering the investigations and other details now public, this “corrupting” practice should be stopped, a former PUC commission president told the Union Tribune. 

“To my knowledge, the Western Power Trading Forum is one big opportunity to have an illegal ex parte with any commissioner that the group can convince to come and talk to them,” said Loretta Lynch, now an attorney in private practice. “In some of the most luxurious settings, groups like WPTF wine and dine commissioners while engaging in private, backroom conversations concerning issues directly in front of the PUC.”

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