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.