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The California Public Utilities Commission is in crisis and in the headlines and needs help to regain its focus on serving the public interest transparently.

I spent 15 of my 19 years at the CPUC working as its public advisor before leaving in 2004. The Public Advisor’s Office was established by law to help the public participate effectively in CPUC administrative proceedings and to help the commission encourage effective public participation.

From this vantage point, I have opinions about the deeper levels of the problems facing the CPUC than are revealed in the headlines today.

And I outline below some ideas about important needed next steps.

There is no doubt that one of the central problems at the CPUC is what is often called “regulatory capture,” meaning that the commissioners and, to a lesser extent, the staff, become captured by those they regulate.

This happens because the representatives of the regulated utilities have become part of the daily life and habit of the CPUC.

The CPUC is not the only government agency to become captured. It is an all-too-well-known phenomenon among regulatory agencies.

The answer to this problem lies partially in structural reforms like those to ensure that commissioners do not speak to parties in cases outside of publicly noticed hearings.

Preventing regulatory capture also requires the governor to appoint knowledgeable people who have the will and personality to understand their role and avoid being “captured” by the regulated utilities.

A second deep problem is a dirty little secret among those who know the regulatory world of the CPUC that is not discussed in the press.

The dirty little secret is that the CPUC cannot possibly effectively do every job assigned to it.

There are simply too many laws with too many requirements and too few staff.

For example, even if you tripled the five or so staff people the CPUC has who cover gas pipeline safety, they could not possibly monitor every utility installation of underground pipe or maintain their own independent database of the pipes in the ground. The CPUC has only barely enough to audit the efforts of the utilities. Yet many in the public think and expect that the CPUC will be there when all gas pipelines are installed and will have its own independent database of what pipes are where.

One answer to this problem is to have a top-to-bottom independent review of the CPUC responsibilities. Experts and public members of the review panel should examine every law that requires CPUC regulatory action and determine which are truly needed to protect the public safety and health, which are otherwise essential and which need to be rescinded so that the CPUC can focus on its essential responsibilities.

The review needs to examine how many staff are actually necessary to do an effective job for each of the statutory requirements examined by the review panel.

If this is done in a public way, it may also help the state Legislature and the public have fuller understandings of how much varying levels of regulation and oversight cost.

There is no doubt that the CPUC is in crisis. Not only does it need change from within, it must find a way to regain public confidence.

In the last session, the Legislature passed numerous bills that addressed the crisis at the CPUC. Some of these were thoughtful and others not as much. The governor vetoed all of them. It was good to hear that Gov. Jerry Brown has now engaged with the Legislature to try to agree on needed reforms.

It is also clear that the CPUC needs a public, independent review of its statutory responsibilities. If the governor will not appoint such a review panel, then the Legislature should.

This is a much more reasonable and prudent first step to take, especially when compared to the short-lived constitutional amendment proposal to take the CPUC out of the state Constitution.

This proposal asked us to trust that the Legislature would come up with the details of how to distribute the CPUC’s functions and responsibilities only after the fact. Before starting down that road, wouldn’t it be good to have a thorough review of the current statutory responsibilities of the CPUC?

Robert Feraru is a former employee for the California Public Utilities Commission who held several senior staff positions from 1985 to 2004. He lives in Richmond. This piece first appeared in the Santa Rosa Press Democrat in March 2016.

Comments on this entry are closed.

  • Jean April 27, 2017, 11:39 am

    Wouldn’t it make sense for the CPUC to share safety inspection and enforcement with the jurisdiction where the utility infrastructure / equipment is located? San Bruno certainly had an interest in the safety of its residents and integrity of capital improvements, and would have been in the best position to take appropriate action. City and County Public Works departments are run by licensed engineers who have the knowledge and manpower to deal with these issues.
    Another suggestion: no former utility executive or board member should be eligible to serve on the CPUC. Their skills would be welcomed in many other capacities.

    • James Toy April 27, 2017, 5:25 pm

      Not a bad idea, Jean, but with such an arrangement some state funding would be required because municipal budgets are already spread too thin to take on additional responsibilities without help.

  • David Breedlove April 27, 2017, 12:07 pm

    Hire that guy. He’s a gem.

  • Donna Gilmore April 27, 2017, 12:39 pm

    Commissioners are appointed by the Governor and confirmed by the Senate. When Loretta Lynch didn’t follow “orders” from the Governor, she was removed from her CPUC President position. Learn more about this and watch Loretta Lynch interview at
    https://sanonofresafety.org/cost-of-nuclear-power/

    The Nuclear Regulatory Commission is also a “captured” agency. For example, PG&E loaded over half the highly radioactive spent nuclear fuel waste incorrectly in thin-wall storage canisters, yet the NRC gave them a pass and didn’t make them reload the canisters. These canisters are welded shut and cannot be inspected without destroying the canisters. The NRC claims it will be fine, but has no idea if the incorrect loading has or will damaged the fuel assemblies (due to overheating from the incorrect loading). Each canister contains more highly radioactive Cesium-137 than was released from Chernobyl. PG&E cannot even inspect the outside of the thin-wall stainless steel canisters and the NRC admits canisters can crack from the moist ocean air, yet the NRC continues to approve these canisters, PG&E continues to buy them and the CPUC continues to give them money to buy more. Each canister system costs about $4 million (including labor). I intervened in a CPUC proceeding on San Onofre decommissioning. I made a cost-based case regarding how these inferior canisters may fail in as little as 20 years and no funds are allocated for replacement or maintenance (and they cannot be inspected or repaired). The CPUC judge ruled my legal brief and testimony meritorious, but said it was “out of scope”. The Commissioners all ruled in favor of Southern California Edison even though they knew the problems with these canisters and knew there were no ratepayer funds to deal with failing canisters. To make matters worse, PG&E and Southern California Edison have no way to inspect or maintain these thin-wall canisters to avoid leaks. Holtec’s president, Dr. Singh, the manufacturer of the canisters, says even a microscopic through wall crack will release millions of curies of radiation into the environment.

    The California Coastal Commission continues to allow both PG&E and Southern California Edison to install these canisters near our California beaches, in spite of knowing the problems with these canisters.

    Learn more at https://sanonofresafety.org/

  • david fairhurst April 27, 2017, 1:38 pm

    Good info. I agree with Jean on her suggestions too.
    I have never been responded to whenever I have contacted the PUC and do think they just don’t give a rats behind for the public. Isn’t Cal-Am selling something that really doesn’t belong to them? Isn’t it a lot like they are selling “air”? You can not live without water so why is it a “profit” market?

  • Karl Pallastrini April 27, 2017, 7:44 pm

    The substance of Mr. Feraru’s article is simply “overwhelm.” The PUC does not have the resources or personnel to do an effective job of monitoring the systems in their charge. What happens when this occurs? Rubber stamping anything that has a remote chance of holding water…no pun intended. The PUC has become a large part of the problem, due to their ineffectiveness in protecting rate-payers subject to dealing with private, for profit, providers.

  • bill leone April 29, 2017, 8:33 pm

    It is Not surprising news that the CPUC is an accomplice to a criminal organization. However, it’s malfeasance is merely a symptom of a large socieo-economic problem, which is comprised of corrupt
    politicians, lack of public vigilance, voraciously greedy corporate criminals, the Social Darwinism underlying the Financial Sector of the American economy, as well as the guiding philosophy of Free Marketeer Conservatism & Libertarian thought.

  • Karl Pallastrini April 30, 2017, 7:33 pm

    Well said…I hope that those in power remember that you can’t take it with you.