PG&E Trying to Make Fight For Public Power Nearly Impossible

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In 2006 the public was allowed to vote on two measures in Yolo County and there were two counterpart measures in Sacramento County to allow Yolo County residents to discontinue using PG&E as their power company and join SMUD.  SMUD represented a cheaper and more environmentally friendly approach through its public owned, not-for-profit enterprise.  In a rare show of unanimity among local elected officials, nearly every elected official from the Yolo County board of Superivisors, the city Councils of Davis, Woodland, West Sacramento, and Winters, and even school boards all supported the move.

PG&E seeing its livelihood threatened proceeded to dump over 11 million dollars into a campaign to discredit the efforts of SMUD and scare the daylights out of residents in Sacramento County.  It worked.  One of the ballot measures in Yolo County passed and the other failed by a small margin of votes.  However the ballot measures were overwhelmingly defeated in Sacramento County.

In this week’s Sacramento News and Review, we have now learned that this lesson was too close for the comfort of PG&E.  Cosmo Garvin reports that PG&E is now making a push for an amendment to the state constitution that would make it difficult if not impossible for publicly owned utilities like SMUD to expand into new territory. 

The “Taxpayers Right to Vote Act” would also hamper the ability of communities to create their own public utilities, an activity that ballot measure spokesman Greg Larsen likens to a government takeover.

“If communities choose to pursue any kind of government takeover, it can happen, but there has to be a vote,” he said.

The very name of this ballot measure is misleading.  For it is clear that in fact in 2006 there was a vote–in fact four votes two in Yolo and two in Sacramento County.  However, apparently those elections were not actually required by law.

Nevertheless this measure would set a much higher standard, according to Mr. Garvin’s article, “requiring voters to approve any takeover of an existing public power grid by a two-thirds vote. Raising the bar even further, the new law requires an election in the proposed new service area, along with a separate election in the existing service area, without exception.”

The communications director of SMUD, Elisabeth Brinton suggests in the article that the PG&E backed constitutional amendment would not give the ratepayers much of a choice.

“It really goes to the heart of the right of people to have choices, that’s the intent of this measure.  It’s horrendous. The cost of doing these elections, the whole process is really extraordinary.”

Like the misleading name of the ballot measure, the initiative is being pushed by a group with a deceptive name, Californians to Protect our Right to Vote.  It’s basically an “astroturf” effort however as the filing fees are being paid for by PG&E and according to spokesperson Greg Larsen, PG&E is “definitely part of our coalition.”

Wikipedia refers to the term astroturfing as:

“Political, advertising, or public relations campaigns seeking to create the impression of being spontaneous “grassroots” behavior, hence the reference to the artificial grass, AstroTurf.”

It continues:

“The goal of such a campaign is to disguise the efforts of a political or commercial entity as an independent public reaction to some political entity—a politician, political group, product, service or event. Astroturfers attempt to orchestrate the actions of apparently diverse and geographically distributed individuals, by both overt (“outreach”, “awareness”, etc.) and covert (disinformation) means. Astroturfing may be undertaken by an individual pushing a personal agenda or highly organized professional groups with financial backing from large corporations, non-profits, or activist organizations.”

Clearly this term would apply to the current situation.

The News and Review further ties the two efforts:

“Although it’s still early in the process, Larsen said any future campaign would likely rely on the services of Townsend Raimundo Besler & Usher, the same Sacramento firm which ran PG&E’s anti-public power campaigns in Sacramento and Yolo counties in 2006. Townsend Raimundo Besler & Usher is also the firm that ran Kevin Johnson’s successful mayoral bid in 2008 and is now trying to help one company obtain the rights to store 3 billion cubic feet of natural gas under the ground (and under houses and business) in the Avondale-Glen Elder neighborhood of Sacramento.”

The push for public power in part has to do with the lower electrical rates but also the greener energy mix.  Mr. Larsen argues that the voters should have a say in this process but fails to cite a single case where they have not.

“SMUD customers have historically paid lower electricity rates than PG&E customers, and they now have access to an energy mix that is slightly greener, using more power from renewable sources like wind and solar. While PG&E customers can try their luck complaining to the company’s customer-service department if they have a problem, SMUD ratepayers can directly harangue the utility’s board of directors at weekly public meetings, should they choose to do so.

Therefore, it’s not surprising that where SMUD and PG&E butt up against each other, PG&E customers occasionally try to defect. The proposed ballot measure would erect a wall making such defections difficult, if not impossible. It’s only fair, Larson says, because switching to public power generally requires the government agency to buy out the private agency’s land, power lines and other equipment.

“If a government goes to go and buy out a power system, the people wind up footing the bill,” Larsen said. “When governments want to get involved in the energy business, the voters should have the final say.”

Still, Larsen couldn’t name any occasion where the electorate had been denied a vote on a public power proposal. “You’re making it too complicated,” he said. “This measure simply sets up a standard.”

Voters have always had the final say on public power proposals, at least in the Sacramento region. In fact, as noted, there were four votes on SMUD’s expansion in 2006 alone. PG&E was successful in getting an advisory vote passed on that year’s June primary ballot. That measure called for a binding vote in both Sacramento and Yolo counties before SMUD’s expansion could be approved. “

The bottom line appears to be that if residents want public power, they are going to have to ward off efforts such as these.  And it will not be easy.  As mentioned earlier, PG&E spent more than $11 million on the fall election which shattered all sorts of local campaign finance records.  SMUD as a public agency could not spend any money on the political campaign, and while local businesses and the elected officials were basically united behind the measure, they were no match for the financial clout of PG&E.

It seems overkill that PG&E would wish to further stack the deck, but that is exactly what has happened.

“You see people rebelling all over the place,” observed Susan Patterson, a former member of the SMUD board and one of the leaders of the 2006 campaign to expand public power into Yolo County. “This is PG&E’s attempt to put the final nail in the coffin for public power.”

“SMUD can’t put any money into a political campaign,” Patterson noted. “But PG&E has a bottomless checking account.”

The residents of California now are going to have an uphill fight to keep even the possibility of life without PG&E alive.

—David M. Greenwald reporting

*image at the top was the image scanned from a misleading brochure that implied that PG&E was affiliated with the No on X campaign and represented the environmental and progressive choice.  Here was the Vanguard article at the time.

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About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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19 thoughts on “PG&E Trying to Make Fight For Public Power Nearly Impossible”

  1. anon

    Text of the proposal is [url]here (.pdf)[/url]. Note that ‘public power’ agencies are not subject to CPUC regulation. Also need to remember that public power failed here (in part) because of the infrastructure cost estimates.

  2. I would argue

    That Public Power failed here in part because PG&E was able to make their case using their vast resources to scare the public into believing the costs would be prohibitive.

  3. Sacramento Citizen

    I voted against the Smud deal because I am not going to agree to higher energy costs just to please davis. Davis wants a favor, so they are going to have to give something up to get it. Davis needs to show more humility. They don’t just get cheap energy because they want it. Davis looks their collective noses down at everyone else, so why am I going to give them cheap electricity?

  4. Sacramento Citizen

    Hook, line, sinker:

    you insult me at your own peril. Sacramento citizens decide smud annexation, not davis. my vote outranks yours.

  5. Sacramento Citizen

    Hook line sinker.

    your point is nothing. you assume I voted the way I did because pG and E told me to. you have nothing to base that on.

    the bottom line is Davis wants a favor from me. I should just send cheap energy Davis’ way because they want it. Tell me this: as a sacramento citizen, what do I get in return for my generous annexation of cheap electricity to davis?

  6. Huh?

    “Sacramento citizens decide smud annexation, not davis. my vote outranks yours.”

    I assume you voted against SMUD annexation of Yolo bc there was no financial advantage in it for Sacramento? Yet Sac County was perfectly willing to have TANC put power towers through Yolo, which Yolo would have gained no benefit from, but would have carried all the burden for Sac County. So when you say Davis looks down their nose at Sacto, I would say that was the pot calling the kettle black.

  7. David M. Greenwald

    There are a lot, the article mentions one up in Roseville.

    Here’s a list of all them ([url]http://www.appanet.org/aboutpublic/ppstatelistingsdetail.cfm?State=69&sn.ItemNumber=2059[/url])

  8. Sue Greenwald

    The SMUD board agreed to the annexation because independent consultants said that both Sacramento AND Yolo rate-payers would end up with lower rates due to the economies of scale. “Sacramento Citizen” should understand that there is a reason that PG&E spent $11 million dollars to keep the Yolo County market, and that reason is that we are a profitable market.

    Under the agreement that we voted on, Yolo County ratepayers alone would have paid the entire cost of the poles and wires. The independent consultants determined that we would still save on rates, without costing Sacramento anything. Ultimately, the economies of scale would have lowered both rates on both sides of the causeway.

  9. citizen

    I just wish our lives were not controlled in so many fundamental ways by the deep pockets of corporations which are, ironically, filled with our dollars. Unfortunately, this will not change until the public learns to read, write and think.

    With this in mind, I hope comments to this blog do not degenerate into grade school name calling. I know Sacramento has better to offer.

  10. Dan Berman, Davis

    Thanks to Davis Vanguard for reminding people what PG&E is up to. Don’t forget that the Yolo County supervisors and the city councils of Davis, West Sacramento, and Woodland each voted unanimously in favor of a SMUD takeover of the 71,000 electric meters from PG&E.

    Nine years of advocacy paid off in Davis proper, where we beat PG&E by a vote of 62% to 38%, but we just couldn’t resist the PG&E media onslaught in the rest of Yolo County and in existing SMUD service territory. Apparently most people didn’t know that SMUD charges 25% less than PG&E.

    In fact SMUD itself would have benefited from the annexation: SMUD revenue would have increased by 14% and costs would have gone up by 8%, according to studies carried out by SMUD staff. In additon, as Davis City Council member Sue Greenwald pointed out, Yolo ratepayers would have paid all the costs of the annexation.

    On a state-wide basis, PG&E also fears campaigns for Community Choice Aggregation (CCA), which would allow cities and counties (instead of PG&E) to buy green energy on behalf of local private utility customers. There are active campaigns going on in San Francisco and in Marin County to do just that.

    At present the South San Joaquin Irrigation District continues to campaign to replace PG&E service to 35,000 electric customers. Since SSJID owns ample hydro resources, the change will substantially lower electric bills once it is successful. PG&E is spending millions to fight this effort in court. Stay tuned.

  11. Rich Rifkin

    Dan, if we formed a DMUD, what would be our source of electric power? Would a DMUD have rights to acquire federal hydroelectric power the way SMUD does? Would DMUD have to construct power plants? Could DMUD get by purchasing surplus power on the open market? If it is the latter, would that still be cheaper than PG&E?

  12. smuds not as great as you think

    I worked for a company that worked with both SMUD and PGE. I found out about the business rebates for companies to do retrofits. Smud’s prices are not that cheap. 8 cents a kwh while pge is 14 cents a kwh. But smud has all sorts of “surcharges” and “fee” and “taxes” where after all is said and done, they come out to be about the same. It’s completely misleading. Also, the business rebates for SMUD are so inconsequential, that many businesses don’t do the rebates or retrofits cause it’s not worth it to them. SMUD then takes that money from the :”public purpose programs” that every body pays into, puts it into an escrow account, takes money from the interest an spends it for themselves. PGE does the same thing but not as bad as SMUD. At least PGE offers a good incenting in the rebate program for businesses to go through a green renovation. Wall greens, and a bunch of other companies got a lighting retrofits and solar energy on their warehouses because the incentives from PGE were awesome. SMUD hasn’t done much retrofitting because it’s not worth it for companies.

  13. smuds not as great as you think

    ps, I got my house retrofitted through the PGE energy partners program. They came in, filled in some cracks, plug outlets, changed the lights out, I got a new air conditioner, new energy efficient fridge, and a bunch of other stuff and my bill was cut by 40%. SMUD doesn’t have a program like this. It’s not as great as you think. Don’t believe the SMUD hype.

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