More than 35 years ago, before 1988, California’s insurance commissioner was an appointed official, and one result was that insurance companies who contributed to governors’ political campaigns invariably got favored treatment when they wanted to raise their premiums.
Insurance commissioners since then have been far from perfect, but no one questions that consumers have saved more than $13 billion in rate-increase reductions since the office became elective via Proposition 103.
Decades later, isn’t it about time the same thing happened to the California Public Utilities Commission, originally set up in the early 1900s to keep consumer prices down?
For if there’s ever been an agency in state government that favors the industry it regulates over the consumers it’s supposed to protect, that is the PUC.
Time and again, the PUC finds ways to keep electric companies alive and well-heeled even after they’ve been convicted of negligence and malfeasance for causing well over 100 deaths.
No matter how many fires they cause, no matter how many gas leaks and explosions their facilities somehow allow to happen, whenever companies like Pacific Gas & Electric, Southern California Edison, Southern California Gas and San Diego Gas & Electric ask for rate increases, they are forthcoming.
Meanwhile, no one can touch the five PUC commissioners who facilitate this via a well-documented Kabuki dance where utilities always demand more from customers than they know they’ll get. Just like in a Kabuki dance, an elaborate ritual ensues but the outcome is foreordained.
Even when these companies are fined hundreds of millions of dollars, it’s like water off a duck because they know they’ll get it all back and then some in their next routine rate increase.
Meanwhile, the PUC goes merrily along, its five members each serving six-year terms. Not even the governor who appoints them can fire them, and their decisions can be appealed only to the state Supreme Court, a rare event.
Here’s just one example of how the commission favors the utilities: After CalFire investigators found PG&E negligence in 2017, 2018 and 2019 caused several of the largest and most destructive wildfires in California history, the PUC unanimously okayed Gov. Gavin Newsom’s plan to dun consumers more than $13 billion to cover the costs of future fires expected to be caused by PG&E and its brethren.
No one ever explained why a company as irresponsible as PG&E had shown itself to be deserving of a huge subsidy, which consumers around the state are paying on today via their monthly bills.
No one ever explained why California would not be better off if that company and others were broken up and the pieces taken over by state and local governments. There was not even an investigation of this possibility.
Quite possibly, this happened because PG&E and the other utility companies have been major donors to Newsom’s political campaigns and others, to the tune of tens of millions of dollars over two decades.
This never became an issue in the 2021 drive to recall Newsom, possibly because the PUC acted exactly the same under Republican governors like Ronald Reagan and Pete Wilson.
Meanwhile, one survey sponsored by a group called RecallCPUC found that same year that 64% of Californians wanted to get rid of the PUC.
It’s actually not a bad idea to dump the present five commissioners and the system by which they are named. But no one has seriously suggested how to replace them.
The simplest outcome would be to move PUC functions into the governor’s office, where things would be even more political and campaign donation-driven than today.
A better solution is to make the PUC, like the insurance commissioner, elective as it is in some other states, like Texas. This could be done via the initiative process, just as it was with the insurance department.
If there’s enough public support, there would be plenty of time this spring to write and qualify an initiative for the November ballot to make a change that can only benefit the great mass of Californians.
So, yes, make the commission overtly political, that is, subject to the will of the voters. They could not possibly pick worse commissioners than the governors of the last 50 years.
Email Thomas Elias at [email protected].