BALLOT INITIATIVE WOULD END PRIVATE UTILITIES, CREATE STATEWIDE PUBLIC UTILITY DISTRICT

East County News Service

November 8, 2015 (Sacramento) – California’s Secretary of State has approved signature gathering for a ballot initiative that if approved by voters, would end private utility corporations such as San Diego Gas & Electric, Southern California Edison and Pacific Gas & Electric.

Under the measure, the state would buy out the companies and operate a publicly owned California Electrical Utility District that would set electricity rates, build infrastructure and provide power. Bonds or taxes could be levied to fund costs. The measure’s backer, Ben Davis Jr., contends the state can provide power at lower rates for California customers and notes that nationwide, public utilities have 15% lower rates on average than privately owned utilities.

The Sacramento Municipal Utility District, where Davis served as a Rate Advisory Board member, averages 25% lower than California’s IOU rates.  The initiative would allow existing public utility districts to remain.

It is unclear however whether it would allow formation of new municipally owned districts, such as the San Diego Energy Foundation’s proposal for a public district to serve the San Diego region.

An 11-member elected board, with each member representing a ward or district, would run the new state utility district. How successful (or not) a publicly owned utility district could be might hinge on who serves on the board, since the caliber of governance is key.  

The recent scandals and at times, failure to provide oversight by the Public Utilities Commission is an example of failed governance.  But a key difference is the PUC commissioners are appointed by the Governor, while board members for the new California Electrical Utility District would be elected by the people—and presumably could be removed by the people if they abused their powers.

Utility corporations are expected to wage a vigorous campaign to oppose the measure if it qualifies for the ballot.

Two prior efforts by Davis to create a public utility district failed to get enough signatures. But recent utility scandals and investigations into alleged undue influence by utilities on the Public Utilities Commission over the San Bruno pipeline explosion and other matters could spur more consumer interest in doing away with investor-owned utilities.  Voters could perceive publicly owned utilities as offering greater transparency, with profits flowing to the public treasury instead of corporate shareholders. 

Elimination of private utility corporations could have sweeping implications potentially impacting everything from grid stability to wildfire detection and firefighting services provided by utilities, as well as an end to grants that private utilities give to local charities. If enacted, the measure would also eliminate the utility industry's powerful lobbying force that has pushed to slash incentives for consumers to invest in rooftop solar, backed a nuclear waste dump at San Onofre, and lobbied to provide incentives for building industrial-scale power facilities such as desert solar and massive wind projects, as well as high-voltage lines such as Sunrise Powerlink.

Backers have until April 26, 2016 to gather the 365,880 signatures necessary to qualify for the ballot.  But under new election laws, if Davis succeeds in getting at least 25 percent of the required ballot signatures, California Senate and Assembly committees will be required to hold hearings on the proposal, UtilityDive.com reports.

Davis is also pushing for a second initiative that would shut down California’s last remaining nuclear power plant, Diablo Canyon.