Clean Power Archives — Page 4 of 4 — San Francisco Bay Guardian Archive 1966

Progressive supervisors block mayoral appointments

Sasha Cuttler

January 3, 2011

UPDATED: Progressives on the Board of Supervisors have finally started to push back on Mayor Gavin Newsom for his petulant refusal to vacate Room 200 unless his conditions for choosing a successor mayor are met, with the Rules Committee today blocking nine [UPDATE: seven] of 10 of the mayor’s committee and commission appointments.

Led by Sups. David Campos and Eric Mar, the three-member committee has been voting to continue consideration of the appointees to a future date at the discretion of Chairman Campos, even those who they voice support for. But they are trying to force a more equitable approach to governing the city during this transition period. The meeting is ongoing at this writing and can be viewed live here.

The one exception so far has been San Francisco Public Utilities Commission appointee Vince Courtney, with Mar and Campos voicing the urgency of filling the appointment on a body that is now moving forward Clean Power SF and other important initiatives. But they have blocked the appointment of Andrew Wolfram, Richard Johns, and Karl Kasz to the Historic Preservation Commission, Harry Kim and Herb Cohn to the Relocation Appeals Board, Florence Kong to the City Hall Preservation Advisory Board, Leona Bridges to the Municipal Transportation Agency Board of Directors, and Michael Kim and Leslie Katz to the Port Commission.

Former Sup. Amos Brown lashed out at the move, telling the committee, “I’m appalled to witness what’s happening here.”

But progressives have been equally appalled at Newsom for delaying today’s scheduled swearing in as lieutenant governor, reportedly to Jan. 10 after the new board is sworn in, and for demanding that the supervisors guarantee him that they will only support one of his preferred moderate caretakers for the interim mayor position. Newsom’s office did not return a Guardian call for comment on today’s meeting.

UPDATE 1:25 PM: After hearing more than an hour’s worth of testimony in support of Bridges, the committee unanimously voted to recommend her nomination to the MTA, citing that agency’s urgent need for a nominee from the African-American community who has a strong financial management background. The full board will consider her nomination tomorrow.

UPDATE 2:20 PM: Shortly before adjourning, the committee also unanimously recommended Katz be appointed to the Port Commission, saying that agency urgently needs another good appointee, although Mar indicated he didn’t think Kim was right for the position and that nomination was continued.

Beating the reaper

Jesse Hawthorne Ficks

May 25, 2010

rebeccab@sfbg.com

The wholesome-looking woman in the Pacific Gas and Electric Co.-funded Yes on Proposition 16 commercial seems trustworthy. "Voters should have the final say," she intones over a background of soothing music, "because we’re paying the bills."

TV-friendly slogans aside, many have deemed PG&E’s $45 million (a new figure well over the $35 million initially committed by the company — paid for by ratepayers who had no say) Prop. 16 campaign to be a subversion of the democratic process and corporate deception at its worst. And it’s aimed in part at stopping San Francisco — one of PG&E’s most lucrative territories and the home of its central office — from implementing a modest public power program called community choice aggregation (CCA).

But San Francisco may be slipping under the deadline. With a last-minute push by Sup. Ross Mirkarimi and other public-power supporters, it appears that the city will have the legal underpinning of a CCA program in place before the June 8 election.

It’s still complicated and a bit tricky, but under questioning by Mirkarimi April 21, SF Public Utilities Commission general manager Ed Harrington said that the city is going to meet all the necessary deadlines.

Prop. 16 seeks to require a two-thirds majority vote before a local government can move forward with a municipal electricity program. Voter approval of the measure on June 8 would effectively weed out any potential competition within PG&E’s service territory, particularly given that PG&E overwhelms all campaigns with multimillion dollar propaganda blitzes.

Paul Fenn helped craft the state law that created CCA, which allows local governments to purchase power on behalf of their citizens, a vision for an alternative to PG&E that lies squarely in the crosshairs of Prop 16. "Unfortunately, it’s mostly up to Republicans in Southern California how it turns out," Fenn said, because this election will attract conservatives to the polls to decide between gubernatorial candidates in the GOP primary. "Unless people in the Bay Area become aware."

BEAT THE CLOCK

Public power advocates are fighting to stop Prop. 16 — but at the same time, in San Francisco, there’s a frantic effort to gets its own CCA in place. The city is poised to have completed a CCA contract by June 8 — election day.

Although the contract will not be finally approved by committees, the Board of Supervisors, and the mayor until after the election, City Attorney Dennis Herrera says the steps are solid enough to protect the city against the inevitable PG&E lawsuit.

The approaching election day has sent the SFPUC scrambling in a months-long race against the clock to seal the deal on CleanPower SF, the CCA program that envisions offering energy customers the choice of a climate-friendly, 51 percent renewable mix by 2019.

Had the city agency failed to strike a deal with Power Choice Inc. (PCI), the program’s service provider, before the June 8 election, years of effort to get the clean power program off the ground could have gone down the tubes. Mirkarimi, City Hall’s strongest advocate for CleanPower SF, urged the SFPUC to get into gear, nicknaming Prop. 16 "the grim reaper."
Things grew tense in April and May as contract negotiating sessions wore on without success, green-power advocates sparred publicly with the SFPUC, and the "grim reaper" approached. A breakthrough came May 21: the SFPUC announced at a meeting of the city’s Local Agency Formation Commission (LAFCo) that it had finally signed a term sheet agreement with PCI.

A contract based on the terms is expected to be prepared by early June, Harrington said, adding that it could be introduced to the Board of Supervisors on June 8. A month-long review period is expected to follow.

"Today was an announcement of a very critical milestone," Mirkarimi, who chairs LAFCo, noted after the meeting. "I’m delighted to see us turn a corner, and I think … having a term-sheet signed, having a CCA implementation plan approved by the CPUC, and having literature sent out in three different languages to 250,000 households in San Francisco is all a testament that we are, as a city, absolutely serious in implementing and delivering our clean power energy program."

He nonetheless kept cracking the whip on advancing the goals of the program during the meeting. "Any hiccup whatsoever on timelines is a dangerous hiccup," Mirkarimi said.

"We fully expect to meet all deadlines," Harrington responded.

Public power advocate Eric Brooks, who has helped move the CCA program forward since the outset, expressed trepidation at a stakeholders meeting about the SFPUC’s commitment to the program, saying he believed that the city could have cleared the deadline months earlier without having to worry about Prop. 16 as a deadline.

Brooks advocated for Local Power, Fenn’s firm and a city contractor, to play a more central role in program design, saying that as long as the SFPUC remained at the helm, the program would be shaped by "the same inside-the-box thinking" and limited enthusiasm.

LITIGATION LIKELY

Despite recent leaps forward, the common wisdom around City Hall is that CleanPower SF is nonetheless unlikely to escape PG&E’s litigious wrath — particularly if Prop. 16 gets a thumbs up at the polls. If it passed, Prop. 16 would become effective immediately, according to the City Attorney’s Office.

"It’s not a foregone conclusion that Prop 16 will pass," City Attorney’s Office spokesperson Matt Dorsey pointed out. And if it does? "In our view," he said, "San Francisco has already implemented its CCA program," making it capable of withstanding a legal challenge.

"We are talking to the city attorney every single day," Harrington noted during a recent SFPUC stakeholders meeting.

But Fenn warned that a complicated lawsuit could still inflict damage. "Litigation processes can outlast political possibility," he cautioned. "San Francisco may be caught up in the courts." Or, if Prop 16 passes and the program moves forward as planned, "[CCA] might be a weird new variant that only exists in San Francisco and Marin."

Marin County’s CCA program is already up and running, and the Marin Energy Authority recently began providing power to its customers. PG&E — which is bound by state law to "cooperate fully" with CCA implementation — fought it by contacting customers to persuade them to opt out of the program via mailers sent in violation of CPUC laws that only allow CCAs to solicit opt-outs. PG&E earned a sharp rebuke in a May 3 letter from CPUC executive director Paul Clanon, specifically warning the company to "refrain from sending any mailers of this nature in the future."

On May 12, Clanon was back with a second letter. "On May 4, PG&E mailed a letter to every customer that had not opted out of MEA’s service, formatted in a manner that directly conflicts with the direction I provided to PG&E just one day earlier," he wrote. This time, he warned the utility that it was "in danger of the commission’s imposing significant and continuing fines and other penalties."

PG&E responded by saying the mass mailing of illegal opt-out notices had been an accident, and apologized. "They accidentally licked envelopes, accidentally stuck the stamps, and accidentally sent them out?" asked an incredulous Ben Zolno, a Prop 16 opponent, in a phone conversation with the Guardian.

"Nobody quite remembers PG&E acting so outrageously," Sen. Mark Leno remarked to the Guardian in the wake of the debacle. The CPUC later determined that any opt-outs solicited by PG&E’s illegal mailers were void.

At a May 20 meeting, the CPUC bolstered restrictions prohibiting PG&E from printing false statements about CCA programs in mailers but made no move to impose penalty fines. City officials characterized the decision as falling short of the action needed to halt the utility’s attempts to sabotage Bay Area CCAs.

"We would expect the CPUC to tell them to cooperate," Harrington told the Guardian. "What the CPUC said was ‘you can’t lie.’"

Meanwhile it’s up to the CPUC to decide whether to honor PG&E’s request for a $4 billion rate hike, which will amount to an average 30 percent increase on customer bills over three years. "They’re not always guaranteed to get what they ask for," CPUC spokesperson Andrew Kotch noted. Public hearings on the increase are coming soon, with a final decision scheduled for December.

"There have been other sizable rate increases and PG&E keeps coming back for more," says Dwight Cocke of The Utility Reform Network (TURN), which is also part of the Prop. 16 opposition campaign. "Up until recently, PG&E was shutting off 15,000 customers per month" for nonpayment, forcing customers to pay extra deposits and reconnect fees to get their electric service back.

"For a lot of people on fixed incomes and low incomes," he said, "it spirals out of control."

Read up: www.prop16.org; www.powergrab.info

Buying power

March 16, 2010

news@sfbg.com

California voters are about to be bombarded by more than $50 million in political advertising designed to convince them to approve a pair of measures desperately sought by two powerful corporations with a long history of lies and political corruption.

Will this brazen and transparently self-serving effort work? And what does it say about the state of modern politics — particularly California’s money-driven initiative system — that these deceptive campaigns just might convince voters to cast ballots against their own interests?

The corporations have every incentive to try to buy the election — and if they win, it could encourage others to follow. By spending tens of millions of dollars on a campaign today, they will potentially save and earn many times that over the long run. It’s a business decision, plain and simple.

If Pacific Gas & Electric Co. can pass Proposition 16, which requires a two-thirds vote for any municipalities to do renewable energy projects and deliver that power directly to consumers, that will kill the chances of government-backed rivals popping up to compete. It will save the company the tens of millions of dollars it regularly spends to defeat public power campaigns across the state.

If Mercury Insurance is successful with Proposition 17, which overturns part of the landmark insurance reform measure Prop. 103 and would allow companies to increase the car insurance premiums for new drivers and those whose coverage has lapsed, a company notorious for mistreating customers and defying regulators will be able to greatly increase its market share and profits.

Both measures are strongly opposed by legitimate consumer rights groups, public interest advocates, and almost all of San Francisco’s elected officials. But both corporations have proven to be unusually effective over the years at using lavish spending — with money extracted from consumers — to convince private groups and public officials from both major parties to do their bidding.

And plenty of public officials who ought to be opposing the measures are either on the wrong side or silent.

Will Mercury-backed Californians for Fair Auto Insurance Rates (which calls itself Cal-FAIR) be able to convince voters that Prop. 17 is really about saving drivers money? And will PG&E-financed Californians to Protect our Right to Vote succeed in making the case that supermajority thresholds are a needed safeguard against the electricity schemes of elected officials?

That all depends on how informed voters are when they cast their ballots.

MERCURY RISING

Mercury Insurance founder and chairman George Joseph became a billionaire by offering car insurance policies to California drivers who were at a higher risk for accidents than most other companies would accept, charging them expensive rates and then challenging their claims.

When Forbes magazine named Joseph the 283rd richest American in 2005, with an estimated worth of $1.2 billion, it wrote laudably about the practice in describing him: “Numbers guru earned Harvard math and physics degree in three years. Began as actuarial trainee at Occidental Life for $225 a month, quit after realizing salesmen made more. Created own property and casualty insurance company. The Mercury General 1962: targeted customers having trouble getting auto insurance; aggressively investigated suspicious claims. Took public 1985.”

Mercury currently has about $2.3 billion in market capital and a stock price that has roughly doubled in the year since the company began funding a $3.5 million signature-gathering effort to place Prop. 17 on the June ballot. That may be a coincidence, but it’s certainly true that Mercury’s fortunes are tied up with California motorists.

The company’s most recent annual report, filed with the U.S. Securities and Exchange Commission last month, shows California car insurance policies are the lion’s share of the company’s business. Almost 80 percent of its premiums are in California (followed by Florida, Texas, and New Jersey), and 83.2 percent of its $2.6 billion in total premiums cover private passenger cars (as opposed to commercial auto, homeowners, and other insurance products). In California, 81 percent of Mercury customers earned “good driver” discounts, while 19 percent are in higher-risk categories, paying much higher monthly premiums.

California’s car insurance regulation system was created almost entirely by the 1988 pro-consumer ballot measure Prop. 103. That initiative established a system of regulatory oversight and financial transparency, cutting premiums by about 20 percent and limiting what companies could consider when assigning rates.

The main rating factors, in descending order of importance, are customers’ driving safety records, number of miles they drive each year, and the number of years they have been driving — which all have a direct relationship to the odds of having an accident.

Before Prop. 103 went into effect in 1990, insurance companies could pretty much charge whatever they wanted, based on whatever criteria they saw fit. And that freedom became a gold mine in 1984 when the California Legislature required all drivers to have car insurance.

“After that, everyone in the marketplace is required to buy insurance and there’s no protection against how much insurance companies could charge you for it, or even if they refused to sell it to you because of where you lived or the color of your skin. There were just no protections,” said Harvey Rosenfield, founder of Consumer Watchdog.

So Rosenfield wrote Prop. 103 and he’s been battling Mercury Insurance ever since. They’ve tangled in the halls of the Legislature, where politicians from both major parties have received millions of dollars in campaign contributions to push bills to undermine Prop. 103. They’ve fought in court in countless hearings over more than two decades, most recently on March 12 in a dispute over Prop. 17 ballot language and arguments. And they’ve fought in the court of public opinion, right up to today, as Rosenfield leads the fight to defeat Prop. 17.

“One of the most pernicious practices after the Legislature said you have to buy insurance was that when you went to the insurance companies and said, ‘OK, I’m required by law to buy insurance, now sell it to me.’ They’d say, well you didn’t have it before, so we’re not going to sell it to you now. Or, you didn’t have it before so therefore we’re going to surcharge you and double the price of insurance. Talk about a Catch 22,” Rosenfield said.

Rosenfield and other consumer advocates appealed to legislators, but, he said, “Of course, the Legislature was too beholden to the insurance lobbyists to do any of the proposals that we were offering, so we went to the ballot box in 1988.” And despite an $80 million campaign financed by the insurance industry, Rosenfield’s group won — sort of.

“No longer would your ZIP code be the dominant determinant for how much you pay,” Rosenfield said. But the struggle to implement the law continued. “That battle, just to get that put it in place, we didn’t win that until 20 years after [Prop.] 103 began. We won basically in 2006, 18 years later, after court challenges and going to the [insurance] commissioner.”

INSURANCE POLITICS

Mercury was one of the major industry players challenging Prop. 103 in court. The company also deftly worked the political system, most scandalously through former Senate President Pro Tem Don Perata, a Democrat now running for mayor of Oakland. Mercury not only gave extensive political contributions to Perata, who then carried legislation for Mercury, including a bill to basically do what Prop. 17 would do, but a San Francisco Chronicle investigation in 2004 found that Mercury’s cash allegedly went into Perata’s personal account in a money-laundering scheme that reportedly triggered an FBI investigation and raid on Perata’s house (no charges were ultimately filed).

Rosenfield described how the company operates in the political arena: “Mercury realizes it’s going to lose the civil suit, goes to Sacramento, spreads a fortune in campaign contributions, and lo and behold, gets a bill passed overriding this provision of Prop. 103, legalizing its surcharges. [Gov. Gray] Davis vetoes it in 2002 on the grounds it violates Prop. 103. Another year goes by, Mercury spreads even more money around, and this time Davis is in a recall election and needs Mercury’s money. So he takes the money — it’s $100,000 or more — and Davis signs the bill. We have to go to court and challenge the bill as an unconstitutional amendment to Proposition 103, which we finally succeed in doing and it’s upheld by the Court of Appeals in 2005. All that time, Mercury is overcharging people. Ultimately, Mercury is told that the law you sponsored is invalid and you can’t do it anymore, so it stops in 2005 — 10 years of wanton, brazen violation of the law. And that brings us to the Mercury initiative.”

Joseph refused to talk to us (he grants almost no press interviews) and Mercury spokesperson Coby King referred questions to Kathy Fairbanks, who heads the Mercury-sponsored Cal-FAIR.

But when we noted that this group is supposedly independent of Mercury, and that my questions were about the company’s history of hostility to Prop. 103, King finally made this comment: “Prop. 103 is the law of the land, but to the extent there are improvements that can be made that are pro-business and pro-consumer, Mercury has not been shy about acting in the public interest.”

POWER PLAYS

Another corporation that has not been shy about flexing its muscle in the political arena is SF-based PG&E, California’s largest and most influential utility company. It is single-handedly bankrolling the Yes on 16 Campaign. Dubbed the “Taxpayers Right to Vote Act,” Prop. 16 was crafted by a Sacramento public relations outfit and law firm that have long histories with PG&E. Its goal: end the expansion of public power in California.

The utility has amassed a war chest of funding to sink into passing Prop. 16, which would make it difficult for municipal governments to break into the electricity business by requiring a two-thirds vote at the ballot before any such efforts could get underway.

Last month, PG&E executives notified shareholders that the estimated $35 million expenditure for the Prop. 16 campaign would affect individual share values by 6 cents to 9 cents. Following on the heels of this news brief was the revelation that PG&E CEO Peter Darbee received a total compensation of $9.4 million in 2009, reflecting a 9 percent pay spike from the previous year, according to the Associated Press.

Since PG&E Corp., the parent corporation, derives 100 percent of its revenue from PG&E Co., the utility company regulated by the California Public Utilities Commission, critics have argued that PG&E is using ratepayers’ money to finance a campaign ultimately designed to limit ratepayers’ ability to choose their electricity provider.

As the utility seeks to alter the state constitution with Prop. 16, it is also boldly pursuing a rate hike of roughly 20 percent by 2011. Winning the Prop. 16 campaign could trigger an economic boon for PG&E since it would dramatically decrease the potential for municipal competitors to spring up and win over customers with lower rates, cleaner power, and more reliable service. Locking in such a monopoly would leave consumers with little choice but to endure rate hikes.

If Prop. 16 fails, however, the utility company’s financial outlook will be dicey. If twin efforts at green, community choice aggregation (CCA) programs moving steadily forward in San Francisco and Marin County prove successful, PG&E could see a depletion of its customer base from those territories and any other municipalities that follow suit.

What this means is that the stakes are high — and PG&E is prepared to pull out every trick in the book to win the Yes on 16 campaign. And yes, there actually is a playbook for how to use deceptive tactics to win these campaigns, a copy of which was obtained by the Guardian.

PG&E’S PROPAGANDA MANUAL

The San Francisco public relations firm Solem & Associates, which has worked with PG&E for nearly 30 years, has produced a step-by-step guide tailored specifically to its anti-public-power campaign needs. This hefty insiders’ playbook is titled “Defending Your Shareholder-Owned Electric Company Against New Municipalization Threats: A Tactical Guide.”

Jonathan Kaufman and Anne Solem, both executive vice presidents, are listed as coauthors. Kaufman is a white-haired guy with owl-like spectacles who can be seen regularly in the public seating section in meetings at City Hall, furiously scribbling notes, whenever the city’s green CCA program is up for discussion. He did not return the Guardian’s calls for comment.

The key strategy explained in Solem & Associates’ playbook is to create the impression that there are influential community leaders and a grassroots coalition agitating independently for the company’s agenda — when in fact the entire campaign is funded, organized, and run by one corporation.

Although the playbook never comes out to state just how the utility should go about persuading these “community allies” to see things their way, it makes it clear such allies are crucial to convince legislators, voters, and the general public that electricity programs run by municipal entities are “fraught with financial risks and other hazards.”

The playbook even recommends seeing to it that “independent” studies are published with findings that support this claim. “To provide third-party credibility to your company’s point of view … develop various reports and studies that analyze the risks and costs involved in a new public power takeover,” the playbook suggests. “It is preferable that the studies come from an independent group rather than your company.”

At certain junctures, Kaufman and Solem blatantly encourage the electric company to engage in misleading practices to hide the influence of campaign consultants working to advance a corporate agenda. “Develop opinion editorials and draft letters to the editor,” the playbook instructs. “Then ask your community supporters to personalize them and submit them to local newspapers.”

It’s interesting, given this advice, that a Twitter feed posted recently by Californians to Protect Our Right to Vote, a PG&E-bankrolled front group set up to promote the Yes on 16 campaign, highlights two different op-eds in the Fresno Bee and Sacramento Bee published within two days of one another. Both editorials were written in support of Prop.16 — one from a former sheriff of Sacramento, and the other from a former city council member of Fresno. Both editorials mention budget cuts to police and fire departments in the second paragraph. Both express surprise at the publications’ editorials against Prop. 16 in the fourth paragraph. Both cite the same statistic in the second-to-last paragraph. And both conclude with the words: “Taxpayers Right to Vote Act.” Is it a strange coincidence?

The playbook contains specific instructions for media-relations techniques, too. “Identify several community and business leaders who are willing to serve as spokespersons for your company,” the playbook recommends. “Try to keep the community leadership out in front of the reporters. Your community supporters can be much more effective with the media than perhaps your company’s own spokesperson.”

In other words: Try not to let anyone know that this is nothing more than a special-interest campaign.

Solem & Associates also suggests planting people at key local government meetings (in case of public comment, “provide them with talking points,” Solem & Associates recommends).

ON THE GROUND

How these tactics get played out in real life can be seen this year in the fight between the PG&E and Mercury front groups, and the eclectic coalition of grassroots organizations and public officials who are opposing them.

Jeff Shields, general director of South San Joaquin Irrigation District, a body governed by five elected board members, described how PG&E operates in testimony to a legislative hearing in Sacramento last month.

“PG&E attends every board meeting of SSJID, often taking video and tape recordings of our meetings, and they fund political consulting firms to campaign against our efforts and pepper us with Public Records Act requests,” he said. “Never once has a voter in our service area had the opportunity to cast a vote to allow PG&E to provide service and never have our citizens been afforded an option to vote for a PG&E Board member or attend — let alone record — a PG&E meeting.”

Yet all of the rhetoric by PG&E’s Californians to Protect the Right to Vote perversely casts the measure as about voting rights, even though this undemocratic measure protects an unelected power provider and is promoted with money that ratepayers didn’t approve for the purpose. “I am a California veteran,” Shields said. “I defended this country in uniform and I am appalled that PG&E has stated in no uncertain terms that its shareholders are paying to amend our constitution. If that is true, then it is important to examine who those shareholders are.”

He pointed out that Barclays Global Investors U.K. Holdings, Ltd., a U.K. bank, owns roughly 4 percent of PG&E shares, while JP Morgan Chase & Co. owns around 2.5 percent. “If these foreign banks and Wall Street institutional investors are truly at will to manipulate the California Constitution and this legislature has no ability to prevent that, God help us all, for the greed that motivates PG&E’s Proposition 16 is only the first thread to be pulled from the fabric that binds our society.”

John Geesman, a former member and director of the California Energy Commission, raised the possibility that if the utility is able to amass so much funding for a ballot initiative, its rates are too high. “The indisputable truth is that PG&E’s rates are set by the CPUC to provide capital to invest in needed infrastructure. If rates are so generous that PG&E can create a $35 million slush fund for political adventurism, something is seriously wrong.”

Indeed, Sup. Ross Mirkarimi, who shepherded the creation of this city’s CCA, Clean Power SF, told a recent Harvey Milk Democratic Club forum that the campaign raises larger concerns about corporate power.

“Know what? If we’re gonna lose, we go down as warriors. And if we win, then we win not for San Francisco or Marin, but we win to address the very fact that Washington is not moving in the direction we would like addressing climate change,” Mirkarimi said. “The complete corporate hubris and arrogance in that they think they can continue to operate in the way that they have is unimaginable.”

The people representing these corporations and their front groups, such as Cal-FAIR director Kathy Fairbanks, stressed to us the “broad coalitions” that support their measures. Those coalitions include “consumer groups” such as Consumers First and Consumer Coalition of California — each which seem to be comprised of only single individuals that back business-friendly measures each election.

Fairbanks defends claims that Prop. 16 would lower rates for most Californians, citing state figures that 80 percent of drivers in the state have continuous coverage and therefore could quality for the discount even if they change carriers to a provider like Mercury that generally offers lower rates than many of its competitors.

And while she grudgingly acknowledges that premium discounts for some are always offset by increases for others, she said the measures would create more “competitive markets” that would cause insurance companies to lower costs and decrease rates across-the board. “They’re going to do whatever they need to do to get more customers,” she said.

Asked whether Mercury’s bad reputation, and the difficulty many voters will have in believing that they’re spending millions of dollars to lower the premiums they collect, hurt the campaigns chances of winning, she said, “Voters are not going to do anything more than read the measures and vote in their interests.”

Rosenfield agreed that this campaign could turn on who can convince voters where their interests lie. “Here’s the issue in a nutshell: will California voters be duped by a $20 million insurance initiative campaign in which the insurance company has to hide behind a phony front group?”

COMPLICIT DEMOCRATS?

After Prop. 17 qualified for the ballot last year, the struggle to defeat it moved into the office of Attorney General Jerry Brown — who is running for the Democratic Party nomination for governor — and again Rosenfield was frustrated by the unwillingness of powerful Democrats to challenge Mercury Insurance.

The Attorney General’s Office writes the ballot title and summary for all initiatives. Given the complexity of insurance law and attractiveness of claims by proponents that the measure would save consumers money (“as much as $250 per year” for “your family,” proponents claim in their ballot arguments), the language of the summary could decide the outcome of the election.

Initially, last August, the AG’s office summarized the measure as “allows insurance companies to increase or decrease the cost of auto insurance based on a driver’s coverage history,” something that seemed to accurately capture what it would do.

“Mercury went crazy because I guess their polling showed that if voters read that it allowed insurance companies to raise your premium, they wouldn’t vote for it. So Mercury made a completely cosmetic change to the ballot measure, refiled it, and this time, magically, the title and summary comes back from Jerry Brown’s office: ‘allows insurance companies to discount your premiums.’ Nothing about raising them, nothing about surcharges. It was outrageous,” Rosenfield told us when we met with him on Feb. 9.

Consumer Watchdog formally challenged the language and issued press releases shaming Brown, which resulted in a minor scandal in which a Brown aide got fired for illegally recording a telephone conversation he had with Chronicle reporter Carla Marinucci about the issue. By Feb. 5, Brown’s office had retreated slightly, including the line “may allow insurance companies to increase costs of insurance to drivers who do not quality for a discount,” but it came below the emphasis on the discount and had weak language that didn’t reflect reality.

Eventually, after Rosenfield submitted studies proving this reality to the AG’s office, it issued language that Consumer Watchdog finds fair and accurate: “Permits companies to reduce or increase cost of insurance depending on whether driver has a history of continuous insurance coverage.”

Then something strange happened. Due to what AG’s spokesperson Christine Gaspara labeled a “clerical error,” the office inadvertently sent the old, weaker “may allow” language over to the Secretary of State’s Office. And because they didn’t realize this before the deadline passed, the AG had to sue the state and its ballot printer to get the correct language in the voter guide.

On March 12, Judge Allen Sumner ruled against Mercury, so the language will read: “Will allow insurance companies to increase costs of insurance to drivers who do not have a history of continuous coverage,” which the official ballot argument against Prop. 17 says will be “$1,000/year (based on Mercury’s numbers).”

Meanwhile, Rosenfield has also been jousting with Assembly Member Dave Jones (D-Sacramento), who is running for Insurance Commissioner this year, trying to shore up his opposition to Prop. 17 over the last few months. When we spoke last month, Rosenfield said Jones privately said he opposed the measure but had yet to do so publicly.

But Jones, who has a strong voting record supporting consumer rights, told us the criticism wasn’t accurate, and that he has consistently opposed the measure. “As I campaign throughout the state, I point to Prop. 17 as a measure that we should defeat … Certainly what Mercury is proposing in Prop. 17 would be bad policy and I oppose it. It undermines Prop. 103.”

Like Rosenfield and other critics of the measure, Jones said the measure is bad for all Californians because it makes insurance more expensive for those who haven’t had coverage. “The danger here is that the dramatic price increases could cause these drivers to drive without insurance — and that is dangerous for all of us,” reads a statement on his Web site.

But the cached Web site function on Google shows that statement was the only one of nine issue statements that wasn’t on the site as of Jan. 30. Asked when the statement was posted, Jones told us he directed staff to include it “some time ago, but we’ve had some issues with our site. It may have gone up recently for all I know.”

Jones’ Democratic primary challenger, Assembly member Hector de la Torre (D-Los Angeles County), has made an issue of his stand on the measure, telling us, “I came out very clearly and strongly on the measure and I wasn’t calculating or cautious … I came out against it months ago and I’m working within the Democratic Party to have them oppose it.”

The state party has yet to take a stand on the measure, and neither Democratic Party executive director Bob Mulholland nor chair John Burton returned our calls on the issue, just as Rosenfield told us he “can’t get Burton to return my calls.” But he remains hopeful the party will oppose the measure at its April convention and put money into defeating it.

“I’d like to think the Democrats will stand up against this insurance company, but Mercury Insurance is very politically connected and the Democratic Party, as we know all too well lately, doesn’t seem to have that kind of backbone,” Rosenfield said.

San Francisco Democratic Party chair Aaron Peskin said he’s confident the state party will join the fight to defeat it: “This is a complete abuse of the initiative process and the voters of California should not be fooled.”

BAD ACTORS

Rosenfield isn’t the only one who has battled with Mercury for many years. “I’ve been after them for 20 years, so this is not a new issue for me,” said U.S. Rep. John Garamendi (D-East Bay), who served as California’s first Insurance Commissioner from 1991 to 1995 and then again from 2003 to 2007. “He [Joseph] has refused to accept the fact that the world has changed around him.”

Beyond just trying to change the rules, Mercury has blatantly ignored them, as a decade’s worth of documents from the Department of Insurance that were released last month show, triggering upcoming legislative inquiries. In 275 pages unearthed by the Chronicle and then obtained by the Guardian, Mercury documents show the company illegally discriminating against certain professions, including soldiers, artists, bartenders, and traveling salespeople.

The Department of Insurance, now headed by a Republican, singles out Mercury as an especially bad actor with a history of hostility to regulation. As Rosenfield told us Feb. 9, “Here’s what California Insurance Commissioner Steve Poizner said about Mercury in a case that’s actually going to be heard tomorrow in Oakland. This is a quote: ‘Mercury’s lengthy history of serious misconduct and its attitude, contempt towards and/or abuse of its customers, the commissioner, its competition, and the Superior Court are all relevant to determining the penalty needed to best ensure the protection of the public for future violations and wrongdoing.’ In my 22 years of working on insurance stuff, I’ve never heard the Department of Insurance refer to a company like that.”

And here in San Francisco, the Guardian has a long history of exposing political corruption by PG&E, from essentially bribing local officials to give it control of the city electricity system — in direct violation of the Raker Act, the federal legislation that authorized the city to construct O’Shaughnessy Dam — to illegally funneling money into anti-public-power campaigns (one such violation in 2002 resulted in the largest fine ever issued by the San Francisco Ethics Commission).

The record on both companies is clearly malevolent, their political dealings utterly corrupt. Good government advocates say Props. 16 and 17 represent a clear litmus test on the power of corporations to push their interests ahead of the general public’s in California.

“To me, it’s a classic case study of what’s going on with the initiative process in California and politics in general,” said Derek Cressman, western regional director of Common Cause. “These are two initiatives literally sponsored by corporations to push very narrow interests.”

“They are laws designed to give a financial advantage to a specific industry or company,” Garamendi said, adding that he is afraid the effort may be successful. “Money talks. It always has, particularly in propositions, and the odds are money will talk again.”

Sen. Mark Leno (D-SF), who also opposes both measures, was a bit more hopeful: “Californians have been savvy in the past, and I do believe they’ll be able to see through the tens of millions of dollars in misleading ads.”

The people vs. corporate power

Andrew Lam

February 17, 2010

steve@sfbg.com

The June 8 election is shaping up to be one that pits the people against powerful business interests, a contest that will demonstrate either that money still rules or that growing public opposition to corporate con-jobs has finally taken root.

On the state level, the five ballot measures include two brazen money-making schemes and two experiments in election reform, along with primary races that are still in flux. In San Francisco, where the ballot measures still have a few more weeks to shake out, the election will feature two rarely contested judges races, recession relief for renters, City Hall fiscal reforms, and a fight for control of the local Democratic Party.

So far, only four local measures have qualified for the San Francisco ballot, all placed there by members of the Board of Supervisors. Progressives qualified the Renters Economic Relief package (which limits rent increases during recessions and sets conditions for landlords passing costs to tenants), an initiative establishing community policing standards, and one affirming city support for making Transbay Terminal the northern high-speed rail terminus. Supervisors were unanimous in supporting a charter amendment governing the Film Commission.

But the board is still hashing out changes to the more controversial ballot proposals, a debate that will continue at its Feb. 23 meeting. They include an overhaul of how the city funds its pension program and an effort to remove Muni salary minimums from the city charter, both by Sup. Sean Elsbernd; a $652 million seismic safety bond proposed by Mayor Gavin Newsom; and a Sup. John Avalos charter amendment that would prevent the mayor from unilaterally defunding certain budget expenditures. All measures must be approved by March 5.

Also still forming up in the coming weeks are primary races for legislative seats (although no incumbents appear to be facing strong challenges) and all eight state constitutional offices, including governor (where Attorney General Jerry Brown seems poised to easily win the Democratic nomination), lieutenant governor, and attorney general (which District Attorney Kamala Harris is running for).

Candidates have until March 12 to declare themselves for statewide and legislative offices, as well as for the San Francisco Democratic County Central Committee, which could play a key role in this fall’s Board of Supervisors elections. Two years ago, a slate of progressives led by Aaron Peskin and Chris Daly launched a surprise attack to wrest control of the board away from the moderates who have long controlled it. Newsom, U.S. Sen. Dianne Feinstein, and their downtown allies are expected to try hard to regain control over their party’s purse-strings and endorsements.

JUDGING THE JUDGES

Another struggle from two years ago is also being replayed. In 2008, then-Sup. Gerardo Sandoval successfully challenged Superior Court Judge Thomas Mellon, arguing the Republican-appointed jurist was too conservative (and the entire court is not diverse enough) for San Francisco. This time the target is Judge Richard Ulmer, a conservative appointed by Gov. Arnold Schwarzenegger. Ulmer is being challenged by two LGBT attorneys, Daniel Dean and Michael Nava, the latter endorsed by Sen. Mark Leno, Assembly Member Tom Ammiano, and Peskin, who chairs the Democratic Party and could be helpful in the race. “He’s a brilliant guy,” Leno said of Nava.

Leno also has endorsed deputy public defender Linda Colfax, a Latina lesbian, in a four-way race to replace retiring Judge Wallace Douglass. The other candidates are Harry Dorfman, Roderick McLeod, and Robert Retana. If no candidate wins a majority of votes, the top two finishers square off in a runoff election in November.

Leno said he’s thrilled to see a diverse crowd of attorneys seeking judgeships: “This governor has failed horribly in his appointments, not only with the LGBT community, but with communities of color as well.”

TWO COMPANIES TRY TO BUY CALIF.

The struggle between the broad public interest and the wealthy power brokers that have long-dominated California politics is most apparent in the state propositions, which have been certified and for which ballot arguments are now being collected by the California Secretary of State’s Office.

Two of those ballot measures, Propositions 16 and 17, are blatantly self-serving efforts by a pair of powerful corporations to increase their profitability, however deceptively and with overwhelming amounts of campaign cash they are presented.

Prop. 16, sponsored by Pacific Gas & Electric Co., would require local governments to get two-thirds of voters to approve creation of energy programs like Clean Power SF, San Francisco’s plan for developing renewable energy projects and selling that power directly to citizens.

As we’ve reported (“Battle royale,” Jan. 13, and “PG&E attack mailer puts City Hall on defensive,” Dec. 22, 2009), PG&E placed the measure on the ballot to avoid having to repeatedly crush public power initiatives around the state with multimillion dollar campaigns, even though political leaders like Leno and Sup. Ross Mirkarimi say the measure violates the state’s community choice aggregation law. That law allows local governments to create energy programs and prohibits PG&E from interfering with those efforts.

“The unregulated behavior of corporate arrogance is killing our democracy. Prop. 17, sponsored by Mercury Insurance, would let companies increase car insurance premiums for a variety of reasons that are now prohibited by the 1988 measure Prop. 103. Mercury has continuously attacked that landmark law, using lawsuits, huge political contributions, sponsored legislation, and, according to newly released documents from the California Department of Insurance (see “The malevolence of Mercury Insurance,” Feb. 10, Guardian Politics blog), blatantly illegal activity in setting premiums and excluding certain customers, such as artists, bartenders, and members of the military.

“The Mercury initiative is even more pernicious than what it was doing before,” Harvey Rosenfield, who wrote Prop. 103 and works for Consumer Watchdog, told the Guardian. “Under Mercury’s initiative, if you’ve never had prior insurance, you can be surcharged for the first time. Then they’ve thrown in some other tricks and traps.”

Mercury spokesperson Coby King told us the company has been unfairly maligned and denies that the measure is simply about boosting its profits: “Prop. 103 is the law of the land, but to the extent there are improvements that can be made that are pro-business and pro-consumer, Mercury has not been shy about acting in the public interest.”

Yet few public interest groups or public officials believe the claims being made by Mercury or PG&E, and they hope that the public won’t be fooled.

“These are measures designed to give a financial advantage to a specific industry or company,” U.S. Rep. John Garamendi, who battled Mercury as California’s first insurance commissioner, told us. He strongly opposes both measures, but did say, “Money talks. It always has, particularly in propositions.”

Yet Leno said he’s a bit more hopeful: “Californians have been savvy in the past, and I do believe they’ll be able to see through the tens of millions of dollars in misleading ads.”

“To me, it’s a classic case study of what’s going on with the initiative process in California and with politics in general,” said Derek Cressman, western regional director of California Common Cause. “There are two initiatives literally sponsored by corporations to push very narrow interests.”

Yet Cressman said recent events could help. There’s been a big public outcry in recent weeks over the U.S. Supreme Court’s decision to allow unlimited corporate spending to influence elections, the role that insurance companies played in sinking federal health care reform efforts, and the way businesses interests are hindering efforts to deal with global warming.

“It makes people aware of the overwhelming role corporations are playing in dictating government policy,” Cressman said.

TAKE OUT THE MONEY

A pair of election reform measures might help lessen the influence of money and political parties. Prop. 14 is an open primaries measure that Sen. Abel Maldonado (R-Santa Maria) got placed on the ballot as a condition for breaking last year’s budget stalemate. It would create a single primary ballot and send the top two finishers to the general election, regardless of party.

Prop. 15, the California Fair Elections Act, takes direct aim at the corrupting influence of money in elections, creating a pilot public finance program in the secretary of state races for 2014 and 2018. The measure, which has broad support from politicians and good government groups in the Bay Area, is modeled on successful programs in Maine and Arizona.

“No elected official should be in the fundraising game the way they are now,” campaign chair Trent Lange told us. “This is a way to change how we fund elections.”

The idea is to create a model that will eventually be used for other offices. The campaign fund would be generated by a $350 annual fee on lobbyists, lobbying firms, and lobbyist employers. Currently lobbyists pay just $12.50 per year to register, which Lange said, “just shows the power of lobbyists in Sacramento.” *

SF seeks green power alternatives to PG&E

November 3, 2009

By Steven T. Jones and Rebecca Bowe

With a unanimous vote by the Board of Supervisors today, San Francisco took a big step into the clean energy business, approving the issuance of a Request for Proposals for projects that will be part of the Clean Power SF program that will compete for customers with Pacific Gas & Electric Co.

The city’s version of the so-called Community Choice Aggregation program has involved “seven years of preparing San Francisco to get into the green energy business,” said Sup. Ross Mirkarimi, who has shepherded the program as chair of the Local Agency Formation Commission (LAFCo).

While PG&E has relentlessly attacked CCA efforts, both locally and through a statewide initiative campaign for would require a two-thirds popular vote for counties to create them, the 11-0 vote here seems to indicate Clean Power SF isn’t as controversial as PG&E would like people to believe.

“This step is a very important step and it’s been an eye-opening experience to serve on LAFCo,” Sup. Bevan Dufty, referring to opposition from PG&E and some of its business community allies and adding, “When the public understands the issues, they like competition and a more sustainable city.”

PG&E’s spooky stories headed to your mailbox

October 30, 2009

By Rebecca Bowe and Rachel Sadon

At a Halloween-themed press conference on the steps of City Hall this afternoon, Supervisors Bevan Dufty and Ross Mirkarimi warned that PG&E plans to disseminate misleading information about the city’s Community Choice Aggregation (CCA) program.

The attack comes on the heels of the Board of Supervisor’s approval of a request for proposals for Clean Power SF, San Francisco’s own fledgling CCA, which seeks to provide competitively priced and significantly greener energy than PG&E. The CCA would challenge PG&E’s monopoly in the San Francisco Bay Area, and the utility is expected to fight it tooth and nail.

Sup. Dufty got a heads up from a PG&E employee this morning that mailers criticizing the program would be sent out tomorrow. Recalling last year’s multimillion dollar campaign against Prop H, an initiative for public power, Dufty emphasized that the city does not nearly have the funds to match a misinformation campaign.

Tom Ammiano denounced PG&E and their tactics as “avaricious, criminal, morally corrupt” and “a throwback to robber barons.”

Though the content of the mailers is unknown, it has already created a stir around City Hall and throughout the community that is advocating for community choice. At the press conference, which was scheduled with very little advance notice, Dufty and Mirkarimi were joined by Sup. David Campos, San Francisco Public Utilities Commission director Ed Harrington, state senator Mark Leno, and Sierra Club representatives Michael Borenstein and John Rizzo.

Mirkarimi, chair of the Local Agency Formation Commission (LAFCo), insisted that “San Francisco is steadfast in its commitment to Community Choice Aggregation,” and stressed that “PG&E continues to mock our commitment to green energy and will do everything in their power to circumvent the process.”

LAFCo and SFPUC joint meeting: The clock is ticking

September 28, 2009

By Rebecca Bowe

tide clock.jpg

In the next few years, San Francisco residents will have the opportunity to switch to electricity that is publicly owned, more environmentally friendly, and either the same price or cheaper than power supplied by Pacific Gas & Electric Co. — if all goes according to plan.

That’s turning into a big “if.”

At a joint meeting held between the Local Agency Formation Commission (LAFCo) and San Francisco Public Utilities Commission (SFPUC) last Friday, LAFCo chair Sup. Ross Mirkarimi tried his best to start a fire under everyone’s rear. Clean Power SF, a public power program that will supplant PG&E in the city, had better get into gear without any foot-dragging or hesitation, Mirkarimi warned.

What’s the hurry? A proposed, PG&E-backed statewide ballot measure has cast a pall over Clean Power SF and other municipalities’ efforts at crafting public power alternatives, or Community Choice Aggregation (CCA) programs.

The PG&E-backed ballot measure would require 66 percent of voter approval before any local government could spend so much as a dime establishing a CCA, effectively creating an insurmountable hurdle. If successful, the ballot measure would snuff out any PG&E competition before it even caught on. The utility is poised to spend millions collecting signatures and pushing it through, and it has until Dec. 21 to gather the 694,354 signatures needed to place it on the ballot next year.

Nip it in the bud

July 8, 2009

rebeccab@sfbg.com

GREEN CITY Imagine if San Franciscans had the choice of sending the check for their monthly electricity fees to one of two places. Option A is a massive private utility company, serving up fossil fuel-fired and nuclear-powered energy, presided over by a CEO who got paid nearly $9 million last year. Option B is a publicly-owned program run by local government that offers a substantial percentage of green electricity from sources such as wind, solar, and tidal power. In San Francisco, which one would people be more likely to pick?

The intent behind community choice aggregation (CCA) programs, which in San Francisco is known as Clean Power SF, is to make Option B a reality. If successful, the program would signify not just a major advance on the green front, but a dent in Pacific Gas & Electric Co.’s longstanding monopoly in the Bay Area.

The program development is inching along under the direction of the San Francisco Public Utilities Commission and the Local Agency Formation Commission (LAFCo). Sup. Ross Mirkarimi, who chairs LAFCo, has poured a tremendous amount of time and energy into the city’s fledgling CCA program.

So when a proposed state ballot initiative surfaced that threatens to thwart statewide CCA programs before they launch, Mirkarimi came out swinging hard.

Titled the "Taxpayers Right to Vote Act," the proposed initiative would require that any effort to create or fund a CCA program be ratified by two-thirds of the voters. The measure would erect an almost impossibly high barrier to CCA development around the state, effectively snuffing out PG&E’s would-be competition and sullying local governments’ plans to embrace publicly-owned, cleaner energy alternatives.

Mirkarimi wasted no time in drafting a resolution against the measure and submitting it to the Board of Supervisors, telling his colleagues that the utility’s proposal undermines years of effort "to allow municipalities to go ahead and chart their own energy destiny so they don’t have to be on the syringe of fossil fuel-driven corporations like PG&E."

He also took issue with the name of the proposal, calling it deceptive and misleading. "The point is that we should not be manipulated by measures such as this, where voters would be required to have a two-thirds vote on something the state Legislature has already allowed us to pursue," Mirkarimi said. "It’s our own right, and corporate special interests shouldn’t dictate otherwise." The state law that grants local governments the right to pursue community choice aggregation, which was sponsored by then-Sen. Carole Migden, specifically prohibits actions that impede the progress of a CCA.

PG&E’s name does not appear anywhere on the ballot-initiative proposal, but a spokesperson for the initiative confirmed that the utility had paid the submission fee. The law firm listed as a contact for the proposal, meanwhile, has been enlisted by PG&E before. And Robert Lee Pence, who is named as the proponent of the initiative, has teamed up with PG&E ally Townsend, Raimundo, Besler and Usher on campaign measures in the past. That Sacramento-based political consulting firm describes its strategic consulting services online with this brazen slogan: "Moving opinions is what we do best."

PG&E did not return calls for comment.

At the June 30 Board of Supervisors meeting, supervisors approved Mirkarimi’s resolution on a 10 to 1 vote, with Sup. Michela Alioto-Pier voting no. And while a resolution does little more than create a formal record of the board’s position on a matter, Mirkarimi seemed to suggest that it was only the start of a battle mounting against this proposal. "Don’t be surprised [if] a number of municipalities align themselves in potential litigation against this," he said.

Sup. David Campos, an attorney who also sits on LAFCo, hinted that the city could enter into litigation on the issue. "I hope the city is carefully looking at legal issues that might be raised by the actions of PG&E," he noted at the June 30 Board meeting. "I think that there are legal protections we need to avail ourselves of, and I hope the City Attorney’s Office, working with the Board of Supervisors, can make sure that the city takes all steps that it needs to take to protect its legal rights."

Campos later told the Guardian that he had not yet spoken with the City Attorney’s Office about it.

When asked about pursuing legal action, the City Attorney’s Office would only say that "we’re aware of it, and we’re evaluating what we will be doing," according to spokesperson Jack Song.

Barbara Hale, general manager for power at the San Francisco Public Utilities Commission, told the Guardian, "We have certainly been talking with other cities about the initiative." But Hale added that the agency hadn’t taken a formal position yet because it is so early in the process. "It hasn’t actually been placed on any ballots yet."

Since the initiative was submitted, public power activists across the state have taken notice. Jeff Shields, general manager of the South San Joaquin Irrigation District, has gone toe-to-toe with PG&E on public power issues before. One of the most memorable battles occurred when a political consulting firm hired by PG&E hacked into SSJID’s computers in the midst of a tug-of-war over control of the area’s electricity infrastructure — only to get caught by the FBI and publicly denounced by PG&E. "Obfuscation is PG&E’s middle name," Shields says. "I know there are lots of people looking at this initiative, but I don’t know that there’s a specific organizational effort against it at this time."

Jerry Jordan, executive director of the Sacramento-based California Municipal Utilities Association — a statewide organization representing 70 public utilities — told the Guardian that CMUA would oppose the initiative. However, "we may wait until it qualifies," Jordan said. The initiative is still in its earliest stages, and the attorney general has yet to certify it as legal to the secretary of state.

Meanwhile, efforts to move forward with the CCA model in other regions are floundering in these tough fiscal times. The San Joaquin Valley Power Authority voted June 25 to temporarily suspend its CCA, an effort in the works for years that had a goal of offering electricity to customers at lower and more stable rates.

Spokeswoman Cristel Tufenkjian said the greatest obstacle was a contract with CitiGroup’s energy branch that was marred by tight credit markets. "When things started to go south with the markets, CitiGroup said it could not execute that contract," Tufenkjian explained. She also added, "We are opposed to the initiative."

The SJVPA bid to create a CCA was also hindered by opposition from PG&E. "For the last few years, PG&E has continually placed roadblocks in front of our program in an attempt to stop us from implementing community choice and ultimately not providing residents and businesses the opportunity to have a choice about who will provide them electrical energy," said Ron Manfredi, city manager of Kerman and chair of the San Joaquin Valley Power Authority.

The Board of Supervisors’ resolution against the ballot initiative condemns such roadblocks and vows to push through this one. "PG&E has a history of acting to maintain its monopoly in its service region, including opposing public power initiatives at the ballot and lobbying officials of California cities [and] counties against community choice aggregation in apparent violation of the provisions [of state law]," the text of the resolution reads.

As this ballot initiative moves through the approval process, it’s clear that a battle is going to heat up very quickly. "I think we have to fight this as hard as we can," Campos told us. "PG&E has been unsuccessful in killing [CCA] here in San Francisco, but they have certainly delayed it. Now they’re trying to make sure it doesn’t happen anywhere else."

PG&E attacks consumer choice

June 17, 2009

rebeccab@sfbg.com

A ballot initiative backed by Pacific Gas and Electric Co. could amount to a death sentence for community choice aggregation (CCA) and expanded public power in California.

Dubbed the Taxpayers Right to Vote Act, the proposed initiative would require a two-thirds majority vote at the ballot before any local government could establish a CCA program, use public funding to implement a plan to become a CCA provider, or expand electric service to new territory or new customers.

The new hurdle would make it very difficult for a local government to move forward with a CCA, while at the same time making it much easier for a utility to defeat public power at the ballot.

Signed into state law in 2002, CCA allows local governments to buy up blocks of power to sell to residents, making it possible for cities and counties to set up alternatives to private utilities such as PG&E and, in many cases, to offer electricity generated by clean, renewable power sources.

The initiative is in its earliest stages, and it likely would not be placed on the state ballot until the June 2010 election. At this point, "it’s unclear how much of a campaign it’s going to be," according to Greg Larsen of the Sacramento public relations firm Larsen Cazanis, a spokesperson for the effort. "It’s a long way off."

That hasn’t stopped local CCA supporters from sounding alarm bells. "Urgent/Bad! PG&E State Ballot Measure To Kill Public Power & CCA," public power activist Eric Brooks wrote in the subject line of a widely disseminated e-mail last week. "It’s red alert time boys and girls," he wrote, saying the proposal "will kill all new Public Power and Community Choice Aggregation projects statewide."

Brooks isn’t alone: everyone the Guardian spoke with who is involved in the creation of San Francisco’s CCA voiced concern that the proposal could kill any future community choice efforts.

The proposed initiative was submitted to the California Attorney General’s office May 28 with the contact listed as the Sacramento law firm Nielsen, Merksamer, Parrinello, Mueller & Naylor, a powerful player with a long history of working with PG&E on ballot initiatives. Larsen confirmed that PG&E had provided the $200 filing fee, the only amount spent so far on the embryonic proposal.

The official proponent of the initiative is Robert Lee Pence, apparently the same person who was listed as an opponent of Proposition 80, a 2005 ballot measure that dealt with utility regulation. Opposition to Prop. 80 was heavily funded by PG&E and other utilities, and the initiative failed by a wide margin.

Pence’s group, Californians for Reliable Electricity, listed Steve Lucas as a contact on 2005 campaign documents. Lucas is also listed as the point person at Nielsen, Merksamer, Parrinello, Mueller & Naylor for questions regarding the Taxpayers Right to Vote Act.

The address listed for the organization is the same as that of Townsend, Raimundo, Besler and Usher — a Sacramento political consulting firm that also has a long history of working with PG&E on political campaigns. When asked about the PR firm’s role in the Taxpayer Right to Vote Act, Larsen acknowledged that they "may be involved as the campaign goes forward," but cautioned that any discussion so far has been preliminary.

The rationale behind the initiative is to protect taxpayers, Larsen said, because CCA programs "are major issues that communities undertake and require millions or billions of public dollars." The proposed initiative, he said, seeks to "ensure that voters — and frankly, their descendents — who will wind up being responsible for these programs have a say." If the measure passes, Larsen added, voters could still approve CCA programs — but with two-thirds of the vote, a supermajority that he contends is "staying in line with many other California requirements."

California Sen. Mark Leno, however, has a very different opinion. "I would hope that Californians would have come to understand that two-thirds vote thresholds are probably more responsible for damage to the state of California in the past 30 years than any other single factor," he said. "To hand a small minority controlling power is anti-democratic. This must be defeated." Leno also said he believes that the initiative would have drastic consequences for CCA programs if it passes.

Meanwhile, local CCA supporters say there is more to this than merely sticking up for taxpayers’ rights. If programs like Clean Power SF — the CCA initiative currently being developed in San Francisco — are fully implemented, then PG&E, which makes good money from its monopoly status, would face some actual competition. Naturally, the powerful utility would have an incentive to eliminate the alternative altogether.

Under the current system, PG&E "has to rely on the elected officials to kill CCA, and its much harder … to do that," says John Rizzo of the San Francisco Bay Chapter of the Sierra Club. But if the Taxpayers Right to Vote Act is enshrined in state law, "they could just pour in money and spread propaganda. Particularly the two-thirds requirement is just outrageous — it basically makes it impossible" to secure approval for any step toward CCA implementation.

"It’s a nasty ballot initiative," Mike Campbell, director of San Francisco’s CCA at the Public Utilities Commission, told us. "I think it’s clearly aimed at the heart of CCA." Campbell added that while he has been in discussion with SFPUC staff and others involved in hammering out Clean Power SF, he wasn’t at liberty to discuss a strategy for fighting the proposed initiative just yet.

Ross Mirkarimi, who chairs the city’s Local Agency Formation Commission — the body tasked with working in tandem with the SFPUC to implement San Francisco’s CCA — called the proposal "heinous — and yet I expect nothing less from PG&E.

"They can try to win by well-funded misinformation blitzkrieg," Mirkarimi noted. "If they’re able to spend $10 million without blinking here in San Francisco [on defeating a public power measure], they’re poised to spend tens of millions on this. As a state battleground, this elevates the fight that much more. We have to act in solidarity with other municipalities. We should be well-armed in repudiation of this effort."

There may be ways to attack the initiative in advance. The CCA legislation bars private utilities from seeking to undermine local CCA efforts. Assembly Member Tom Ammiano told us that the Legislature should look at how PG&E could be blocked from mounting a statewide effort to kill CCAs. "I think there’s some potential there," he said.

Julian Davis, who chaired the Prop. H campaign for public power last year, said he found the proposal very worrisome. "If you shut down community choice, you’re shutting down one of the major vehicles for clean energy," he said. To Davis, the initiative highlights "a disturbing trend of corporate America finding ever-more clever ways of tying the hand of local government in general. You know they’ll dump millions into this," he added. "The ultimate irony here is that none of us have the right to vote on anything PG&E does. None of us has a seat at the PG&E board table. It’s doublespeak."

Rachel Buhner contributed to this report.

Energy deficiency

April 15, 2009

AN ‘A’ FOR EFFORT

Although PG&E and other utilities are entrusted with millions in ratepayers’ money to promote energy efficiency, independent analysis demonstrates that they’ve had limited success. But last December, they garnered rich rewards anyway, at ratepayers’ expense.

In 2007, the California Public Utilities Commission adopted a system to encourage utilities to strive for high energy efficiency standards. Utilities could receive hearty payouts for achieving a certain threshold of energy savings, the commission decided. Conversely, if the companies failed miserably, they’d be slapped with penalty fees. Rather than take the utilities’ word for it, the CPUC directed its Energy Division to inspect the companies’ energy efficiency program performance and report on it each year.

About a third of the funding for these programs is amassed with a mandatory fee on every ratepayer’s monthly energy bill, called the Public Goods Charge. This is combined with a second pot of ratepayer money and collected by utilities to fund initiatives such as rebates, light-bulb discounts, energy retrofits, and consumer-education drives. The program budget for all the utilities from 2006 through 2008 was around $2 billion. For the 2009 to 2011 program, the utilities are collectively seeking closer to $4 billion.

Last December, based on the utilities’ own claims that they’d hit the targets for the 2006 — 2007 program, the CPUC handed over nearly $82 million in incentive payments — with some $41 million going to PG&E. The commission accepted the utilities’ claims because the Energy Division’s verification report was behind schedule, and the utilities argued that this delay would postpone their payments and thus undermine the whole incentive.

At the same time, the commission noted, "We have profound concerns that accepting the [utilities’] proposal … would subject ratepayers to significant risk of overpayment." In an attempt to strike a balance, the CPUC voted to award $82 million rather than the $152.7 million that the utilities claimed they were owed.

But the independent report, which was finally released two months later, concluded that PG&E and two other utilities shouldn’t have been entitled to any incentive payments at all. Based on this analysis, they’d missed the targets.

The move drew criticism from groups like The Utilities Reform Network (TURN), Women’s Energy Matters, and the California Public Utilities Commission’s Division of Ratepayer Advocates, which charged that investor-owned utilities are more concerned about the payouts they receive for running these programs than maximizing energy savings.

"They didn’t seem troubled by the fact that they hadn’t met the goals. They were only troubled by the fact that they weren’t going to get the financial reward," said Mindy Spatt, communications director for the Utility Reform Network (TURN). "I suppose there’s a message in there about just how seriously they take energy efficiency."

Loretta Lynch, a former CPUC commissioner, told the Guardian that she’d been watching the proceedings closely. "They had already promised Wall Street they were going to get this money, and so they had to meet Wall Street’s expectations regardless of whether or not they met the technical requirements of the program," Lynch said.

The CPUC’s Division of Ratepayer Advocates opposed the decision to award the incentive money. "[The utilities] are being rewarded for something they say they’ve done, but that independent analysis shows they just didn’t do," DRA Regulatory Analyst Thomas Roberts told the Guardian. "It’s like rewarding a student for getting a D."

Part of the problem is that PG&E’s program relied heavily on giving away compact-fluorescent light bulbs, and then the utility inflated estimates for how much energy savings they would provide and how long they would last. In other words, CFLs are a good first step to energy conservation, but not enough to make the greatest strides in reducing demand.

Roberts also said PG&E often delivered the bulbs to what he called "free riders," or people who would’ve made the switch on their own. TURN once discovered a box of light bulbs posted on eBay by some crafty entrepreneurs who had purchased them at a discount, courtesy of PG&E. At that point, the bulbs could have wound up anywhere in the country, Spatt points out, instead of reducing electricity demand in California.

"There is no clear connection that we are not building new power plants due to energy efficiency programs," said Cheryl Cox, senior policy analyst and project manager for energy efficiency at the CPUC’s Division of Ratepayer Advocates. "And we do not appear to be on track to achieve long-term, persistent energy savings. Given the dependence of energy efficiency portfolios on short-term savings like lighting, it appears that the utilities would have to spend additional dollars to play catch-up — yet they persist on proposing the same old, non-progressive, CFL programs."

WHO’S IN CHARGE OF YOUR SURCHARGE?

For some, the incentive payouts provided new fuel for a longstanding argument that utilities shouldn’t be in charge of administering state-mandated energy efficiency programs in the first place. Barbara George, executive director of Women’s Energy Matters, points out that states with financially disinterested third parties managing energy efficiency measures tend to be more careful with the money they’re granted, resulting in more energy savings per dollar.

She points to a report completed by analyst Richard Estevez, which ranked 37 statewide energy efficiency programs by cost-effectiveness. "Non-utility implemented programs make up 18 out of the top 20 rankings; utility-implemented programs make up 15 out of the 17 poorest rankings," that report concludes.

Under the current system, "PG&E makes a profit on every dollar," says Lynch. "In addition, all of PG&E’s costs are covered. Then, of course, all the subcontractors’ costs are covered too, so it gets down to only 50 or 60 cents of every dollar that is actually going into programs. The rest of the money is going into PG&E’s profit, PG&E’s overhead, and the subcontractors’ overhead. Not surprisingly, if you’re a nonprofit or a government, you’re doing that service directly at no profit and lower administrative costs."

Paul Fenn, a consultant to Clean Power SF, sounds a similar note. In his view, PG&E "doesn’t want to reduce energy consumption. Why? Because every year, they go to their shareholders and they predict next year’s load growth. That’s their business. They burn gas, and they sell power. They’re a gas and electric company. The idea that a gas and electric company could be adequately incented to reduce their sales is naïve."

Fenn is the founder of Local Power, Inc. and the author of Assembly Bill 117 — a state bill passed in 2002 under the sponsorship of then-Assembly Member Carole Migden that allows municipalities to set up community choice aggregation programs. Local Power has been a key player in San Francisco’s own embryonic CCA.

AB 117 also gave cities the option to gain control of Public Goods Charge funds generated by their own ratepayers. In SF, that would mean funneling roughly $18 million annually into Clean Power SF’s energy efficiency budget.

Sup. Ross Mirkarimi, who chairs a committee overseeing the CCA implementation, told the Guardian he supports the idea. But he warned that the city probably wouldn’t be able to wrest the funding away from PG&E without a fight. "It’s completely appropriate for city government to be in charge of those funds," he says. "PG&E shouldn’t be in the driver’s seat with all that money anyway."

San Francisco is already hailed as a green city, but Clean Power SF, which has renewable energy as its centerpiece, would set a new standard for what cities can do to address climate change. The plan calls for 50 percent renewable energy, compared with PG&E’s energy mix of 11 to 12 percent renewable power. The SFPUC is slated to present CCA program plans to the state next year.

SFPUC’s Michael Campbell, the CCA program director, rejects the idea of going after Public Goods Charge funds just yet. "It’s premature to do that now," Campbell says. "About one-third of the energy efficiency dollars that PG&E collects … come from Public Goods Charge, and the other two-thirds are charges associated with procurement portions of customers’ bills. If a CCA were formed … to have an equal amount of dollars, we would need to have additional charges to CCA customers that would be associated with the energy portion of their bill."

Yet Fenn said applying to administer those funds is long overdue. Not knowing whether that $18 million is in place every year could derail the CCA bidding process, Fenn argues, since it would be difficult for prospective power suppliers to draft a plan if they lack clarity on the program budget.

The other problem, Fenn said, is that without the energy-efficiency funds, it would be harder for the city’s CCA to get its rates down low enough to compete with PG&E. Given the CCA is required to beat PG&E rates, it could make or break the success of the project.

"Energy efficiency is the cheapest resource," Fenn said. "It helps the economic feasibility of the portfolio by creating surplus revenue. If you’re just doing green supply, and not green load reduction, it’s going to be really hard not to pay more than PG&E."

BROUGHT TO YOU BY PG&E

While Clean Power SF lags, energy efficiency programs are percoutf8g throughout the city — usually touted by Mayor Gavin Newsom and funded through public-private partnerships with PG&E.

In a recent post on TriplePundit.com, Newsom announced the creation of an Existing Buildings Efficiency Task Force — composed of landlords, developers, PG&E, and other downtown interests — tasked with greening buildings and creating green jobs.

"The Task Force builds upon a great deal of work we’re doing already — taking full advantage of the $7 [million] to $11 million provided in energy efficiency block grants by the federal stimulus, leveraging our ongoing … partnership with PG&E, and working with private partners to create a San Francisco Clean Energy Fund," Newsom wrote.

A recent initiative to install energy efficient streetlights in the Tenderloin is the result of another PG&E partnership. While there’s no doubt that these programs will have positive results, they also serve to further entrench PG&E into citywide green initiatives, which render it more difficult for Clean Power SF to gain footing further down the road.

With federal stimulus money flowing into state coffers, the utilities are back at the table, recommending to the CPUC that some of the federal funding go into their existing energy-efficiency programs. "We believe that the Recovery Act or ARRA funds should work in conjunction with [investor-owned utility] programs to minimize potential customer confusion and leverage the success we have had with the programs," Marc Gaines, a representative for the state’s four investor-owned utilities, said during a recent All-Party CPUC meeting to discuss the stimulus funds. "Rather than competing with the programs, we would like to use ARRA funding to supplement existing energy efficiency [and other] programs."

Not so fast, countered George, who stood up to speak during the meeting. "We have to worry about if these funds are commingled with current programs, are the utilities going to rake off profits?" she wondered. "These funds need to be used for authorized purposes, and not for fraud, waste, error, and abuse. The energy efficiency programs have been used to fight public power and community choice efforts. The competition is brutal when it comes to the utilities."

Clean Power SF will take center stage at joint meeting

April 6, 2009

By Rebecca Bowe

Last Friday, Supervisor Ross Mirkarimi declared 2009 the “make-or-break year” for San Francisco’s ambitious Community Choice Aggregation program. Also known as Clean Power SF, the program would establish the city and county as an electricity purchaser for residents and businesses currently served by PG&E, and put S.F. on track for achieving 50 percent renewable power generation. At an April 3 LAFCo (Local Agency Formation Commission) meeting, it was announced that the San Francisco Public Utilities Commission has agreed to sit down with LAFCo for a meeting about CCA for the first time ever — a sign that things could actually start moving forward.

The process of getting Clean Power SF off the ground has been fraught with delay, in part because the San Francisco Public Utilities Commission — which is tasked with implementing the program — dropped the ball on a series of deadlines. During the last couple monthly meetings, LAFCo, which is charged with overseeing CCA implementation, has vented frustration about the feet dragging at the PUC and questioned the agency’s commitment to the effort. However, the tone shifted some at the April 3 meeting.

CCA director Michael Campbell, who was hired by the SFPUC, noted that the city agency is getting back on schedule — and announced the launch of a new Web site. Two new LAFCo staff positions were approved recently by the Board of Supervisors, providing further momentum.

PG&E’s blank check to exceed $10 million

October 24, 2008

By Steven T. Jones

Pacific Gas & Electric has shattered previous campaign spending records by giving more than $9.7 million in cash and services to defeat Prop. H, the Clean Energy Act, as of Oct. 18, according to the latest campaign finance reporting. Is anyone else appreciating the irony of PG&E funneling its seemingly unlimited spending through the front group Committee to Stop the Blank Check? It would really be funny if it weren’t such a seriously duplicitous effort to subvert honest political debate and prevent the switch to renewable energy sources, leaving us with a PG&E portfolio that relies on fossil fuels and nuclear power.

The money is going largely to Mayor Gavin Newsom’s political team, mostly to Eric Jaye, who is spreading it around to various community groups, aggressive advertising, and paid campaign workers going door-to-door. They’re also spending tens of thousands of dollars on polling, and considering that the pace of the PG&E spending has increased since the last reporting period, perhaps they’re getting a little worried that people see through their lies and actually want a future of clean power and local control. The committee still has $1.7 million in the bank and unlimited reserves from PG&E, so watch for things to get even uglier in coming weeks.

But if you’re interested in deciding this measure for yourself, read your ballot handbook about what it will actually do and/or check out a new, fairly even-handed story on the measure from the Associated Press.

Newsom and the Clean Energy Act

July 15, 2008

EDITORIAL A progressive measure that would make San Francisco one of the greenest cities in the nation will be on the ballot this fall. It’s designed to lower energy costs, reduce greenhouse gas emissions, and promote green-collar jobs. It has all the elements that Mayor Gavin Newsom has been talking about in his high-profile speeches, press conferences, and celebrity appearances. It’s a perfect vehicle for a mayor who wants to stand out as a candidate for governor of California. It has the backing of some of Newsom’s close allies, like state Sen. Mark Leno.

That’s why Newsom ought to support the Clean Energy Act.

The charter amendment, sponsored by Sups. Aaron Peskin and Ross Mirkarimi, seeks to make San Francisco more energy independent. It sets ambitious goals for renewable energy and would put the city on track to create its own public power system. It’s not a radical measure — in fact, it’s milder than we would have liked. It doesn’t mandate an immediate takeover of Pacific Gas and Electric Co.’s facilities. It doesn’t turn the Public Utilities Commission into an elected body. And no matter what lies PG&E puts out, it won’t raise electric rates or cost the taxpayers money.

It does, however, mandate that the PUC look at the best ways to ensure that by 2017, 51 percent of the electricity used in the city comes from renewable resources. By 2040, that number should be 100 percent. And the evidence from across the nation shows that the best way to promote renewable energy is to shift from private control of utilities to public power.

Again, that’s hardly a radical notion: more than 2,000 cities in the United States have public power. Palo Alto is among them; so are Alameda and Santa Clara. The Sacramento Municipal Utility District provides reliable service to Sacramento County at rates 30 percent below what PG&E charges customers in adjoining areas — and SMUD has one of the best records in the nation for promoting conservation and renewable energy.

Of course, the very existence of any sort of plan to consider energy alternatives for San Francisco seems to terrify PG&E. Already the giant private utility is pulling political strings and retailing outrageous lies to try to scare the supervisors away from placing the charter amendment on the ballot. And we expect to see a savage, multimillion-dollar campaign against the measure this fall.

That’s because PG&E wants no hint of competition, no chance that the city might actually consider the benefits of public power. It’s no secret why. When you look at the facts, compare how public and private systems have fared in the past decade, and line up the financial figures and the prospects for sustainable energy policies, public power wins.

The biggest misinformation PG&E is putting out these days involves the cost of creating and running a public power system in San Francisco. The company is throwing out numbers like $4 billion, and suggesting that the taxpayers would be on the hook for all of it if the city tried to take over the company’s system.

For starters, there’s nothing in the Clean Energy Act that requires a takeover. It might turn out to be more prudent, for example, to slowly build a new city-owned infrastructure. More important, if the city did decide to buy out PG&E’s wires, poles, and meters, the cost would be nowhere near what the company is claiming.

How much is the system really worth? Well, one way to find out is to check the assessed value, the figure the state uses for property-tax purposes. And as Amanda Witherell reported July 2 (see "The dirty fight over clean power"), the state says all of PG&E’s property within San Francisco city limits is worth only $1.2 billion — and that includes the company’s downtown office complex, which is worth at least several hundred million. So the actual cost of the system might wind up at less than a quarter of what PG&E claims.

And none of that money — none — would come from taxpayers. The PUC could issue only revenue bonds, backed by future electricity sales, to finance any buyout or construction. No tax money would ever be in play. And our past analyses have consistently shown that the city could buy out PG&E’s system, cut electric rates, and still wind up with a sizable surplus every year.

Newsom is aware of all of this, and has said that he’s willing to consider supporting public power. Now there’s a measure heading for the ballot that would also mesh with all of the mayor’s environmental goals. The only argument against it is that PG&E — in the past a backer of the mayor — doesn’t want it to pass.

Newsom needs to support the Clean Energy Act. If he doesn’t, it will demonstrate that he lacks the backbone to stand up to special interests — and has no business running for governor of this state.

A kickoff press conference on the Clean Energy Act will be held at 11 a.m. Tuesday, July 22 on the steps of City Hall.

SOS: Vote here on phony PG&E poll

July 8, 2008

By Bruce B. Brugmann (Scroll down to vote against PG&E and for the Clean Energy Act)

Already, even before the supervisors approve the new San Francisco Clean Energy Act, PG&E operatives are down the poles like firemen and women.

Their first strike is a poll in the July ll edition of the San Francisco Business Times, a link in the American City Business Journals chain, the nation’s largest publisher of metropolitan business journals, headquartered in Charlotte, North Carolina. The Business Times did a poll for PG&E, a major advertiser, that poses these questions right out of the PG&E playbook with the same tired old PG&E arguments.

“Should voters be asked–for the fourth time in a decade–whether San Francisco should take over the city’s electric utility?

“”Yes. As Supervisor Mirkarimi says, San Francisco voters should finally back ‘removing the profit motive from the private sector delivery of electric service.

“”No, no, no…No. San Francisco can’t make the buses run on time. But it can find power to keep the lights on? Yeah, and maybe it could finance buying out PG&E by selling the Golden Gate Bridge.”

As attentive Guardian readers know, this is nonsense and the Business Times, as a paper that purports to write seriously about business and consumer issues, to act as the voice of PG&E so quickly and so cravenly even before the initiative is approved. Public power is the only new large potential revenue source for the city, would be much cheaper and cleaner than PG&E power, and would be locally accountable to the local public. More, it would finally bring the city into compliance with the federal Raker Act, which mandates public power for San Francisco because the Raker Act allowed the city a major concession to dam Hetch Hetchy Valley in Yosemite National Park for our water and power supply.

Cast your vote below. For early evidence of PG&E’s emerging campaign of lies, misdirection and astroturfing, read last week’s Guardian by Amanda Witherell. For the case to “Support SF’s Clean Energy plan,” read the editorial below in the Wednesday Guardian.

Alert: The Supervisors’ rules committee will hold a critical hearing on the initiative at 2 p.m. Wednesday at City Hall, Room 273, item eight on the agenda. Attend if you can and stay alert for more PG&E shenanigans. On guard, for the big battle ahead, B3, who is counting on the clean energy movement to knock out the Potrero HIll power plant tthat I see every day from my office window

Click here to vote in the San Francisco Business Times’ survey.

Click here for this week’s editorial, Support SF’s Clean Energy Act.

Click here to read last week’s article by Amanda Witherell titled, The dirty fight over clean power

The dirty fight over clean power

July 1, 2008

› amanda@sfbg.com

A charter amendment for renewable energy and public power appears headed for the November ballot, and already Pacific Gas and Electric Co. is rounding up front groups and touting inaccurate figures in an attempt to scuttle the plan.

The San Francisco Clean Energy Act, introduced by Sup. Ross Mirkarimi, would mandate that the San Francisco Public Utilities Commission "produce a comprehensive plan for providing clean, secure, cost-effective electricity for city departments and residents and businesses."

If passed, San Francisco would exceed state standards by requiring 51 percent clean, renewable energy by 2017; 75 percent by 2030; and 100 percent by 2040. Workforce development is also part of the plan, and if it’s determined that public ownership of the grid is the way to go, any employees fired by PG&E will be hired by the SFPUC.

"The San Francisco Board of Supervisors is talking about taking over PG&E," Brandon Hernandez, the corporation’s manager of government relations, said at a June 27 Rules Committee hearing on the legislation. "PG&E’s system is not for sale," he asserted. He then went on to say a takeover would cost the city "at least $4 billion."

PG&E spokesperson Darlene Chiu told the Guardian: "That’s our estimate for what our system costs in San Francisco."

But the California State Board of Equalization says all of PG&E’s state-assessed San Francisco property was worth $1.2 billion in 2007. The board’s appraisers assess PG&E’s property for tax purposes and their final figure includes millions of dollars of property that San Francisco would not want to own.

PG&E threw other punches at the city. Hernandez threatened the loss of as much as $29 million per year in taxes and charitable giving. "We no longer will be contributing to San Francisco’s nonprofits and service organizations," he said of groups that received $5 million from PG&E last year.

That money buys some political loyalty. The only organizations that spoke against the measure — the San Francisco Chamber of Commerce, the Bay Area Council, and the A. Phillip Randolph Institute — all received bucks deluxe from PG&E. Between 2004 and 2006, the Chamber of Commerce Foundation received $166,000 from the utility; the Bay Area Council and Economic Forum grossed $132,500; and APRI banked slightly more than $100,000.

The Chamber’s vice president of public policy, Rob Black, criticized the move toward municipalization because it would make San Francisco, like other municipal utilities, exempt from the state-mandated 20 percent renewable energy by 2010. "The Los Angeles utility is at 48 percent coal. That’s not green, that’s not renewable. That’s something we need to be very careful about," he told the committee.

According to the Los Angeles Department of Water and Power, their power mix is actually 44 percent coal. But Black didn’t bother to check; he just took his figures from PG&E moments before, while conferring with Hernandez and Chiu. When questioned by the Guardian, Black said, "They didn’t come to me. I went to them."

He reiterated the concern that municipally-owned power isn’t required by the state to be clean and green, and becoming so could increase rates. "If we’re creating cheaper energy, where’s the incentive to do conservation?" he asked.

According to statistics from the meeting, the average PG&E household spends $74.55 per month on electricity, with 12 percent of the energy used hailing from renewable resources. An equivalent customer in the Sacramento Municipal Utility District has a bill of $46.60 for 18 percent renewable.

APRI’s James Bryant said his Bayview community group has issues with the costs and the idea that former PG&E employees would be hired by the city and subsequently receive worse retirement plans.

When asked if he was there because his organization gets money from PG&E, Bryant said, "Not really." He added, "I don’t have anything to do with their decisions. They don’t have anything to do with my decisions.

"Of all the amoral things PG&E does, they fund very worthy grassroots organizations and then lean on them to speak against things," Sup. Tom Ammiano said when expressing his support for the legislation. "Not only is San Francisco going to have public power, the state of California is going to have public power."

Other public comments overwhelmingly supported the measure. Some energy activists have been concerned that the legislation would derail or delay efforts to move toward renewables through the community choice aggregation (CCA) program.

Running on empty

January 29, 2008

› news@sfbg.com

The fourth floor of San Francisco’s City Hall feels remote. Dimly lit and strangely quiet, it conveys a sense of isolation from the powerful people who do their work in the lower levels of the building.

Here, in an unremarkable conference room, is where the San Francisco Peak Oil Preparedness Task Force is conducting its second meeting. Two of its officers are absent, and only one member of the public has turned up to participate. It is an atmosphere that belies the issue’s cataclysmic potential.

The day’s breaking news headlines of oil reaching $100 per barrel for the first time in history is perhaps a harbinger of things to come. One year earlier the price was $58 per barrel. This dramatic increase in such a short span would devastate economies around the world if it continued at anywhere close to that rate.

Chairperson Jeanne Rosenmeier, an articulate, contemplative woman, reiterates the task force’s purpose: "Our charge is to examine how the city is going to handle rising oil prices and possible shortages. That is what we have been asked to do."

The assessment seems like an understatement, perhaps suggesting that the group is merely looking for solutions to how the average citizen could function better without an automobile. Yet in a society built on oil, the consequences of such an energy crisis are likely to be far more sweeping and problematic than merely high gas prices.

While considering models for the study the task force will prepare, Rosenmeier points to Portland, Ore.’s recently completed peak oil report and talks about limiting San Francisco’s effort to outlining the range of scenarios, from small impacts to large. She’s reluctant to acknowledge the extralarge scenario — massive worldwide social unrest and full-scale anarchy in the streets of San Francisco — which she argues would be harmful to the group’s focus.

Jan Lundberg, the task force member in charge of "societal functioning," politely disagrees. Insightful and exuding a sort of deeply ingrained experience, Lundberg has a goatee and a big mane of blond hair that make him look like a Berkeley-ish version of billionaire Virgin CEO Richard Branson. The resemblance is strangely apt when you consider that Lundberg has defected from more lucrative ventures. His family’s business, the Lundberg Survey, has been one of the premier oil industry research authorities in the world for the past few decades, but today Lundberg is volunteering his time to the task force.

"You have to look honestly at what we are up against," Lundberg tells the Guardian. "Only then can you come up with intelligent responses to what is occurring. If it is a tsunami coming, then you take action for a tsunami."

It might come as news to most San Franciscans that a team of seven relatively unknown, politically appointed volunteers is hashing out the hard realities and dire implications of a potentially massive energy crisis. When the Board of Supervisors unanimously passed a resolution (with Sup. Michela Alioto-Pier absent) in April 2006 to acknowledge the looming phenomenon of the global oil supply being exceeded by demand, San Francisco was the first city in the country to do so. It was a precedent that received little attention from the media, perhaps shrugged off as just another wacky resolution steeped in San Francisco values.

For the next 10 months the task force will be preparing a study of mitigation measures to be considered by the city government for implementation into law. Much like the phenomenon of peak oil, their work will also be best assessed in hindsight. For now, some will see them as a team of Chicken Littles sketching a contingency plan for when the sky falls.

Yet if the scientific insights that compelled the Board of Supervisors to form the group prove prescient, then the report that the task force is producing may well be crucial to San Francisco’s very survival.

SLIPPERY SLOPE

Oil has acquired a bad reputation in recent years, as if the resource were not a fossil fuel found in the earth’s crust but a corrupt corporate tycoon spurring international conflicts and gleefully dismantling the ozone layer. Like addicts who blame the substance rather than the habit, we have come to forget that oil is one of the best resources the planet has offered.

"Oil is amazing stuff. The 20th century was basically founded on the wonders of petroleum," explains Richard Heinberg, a professor at New College of Santa Rosa and author of several books, including The Party’s Over: Oil, War and the Fate of Industrial Societies (New Society Publishers, 2003). "Oil is very energy dense and can be made into an amazing range of chemicals and products. Our entire way of life is soaked in petroleum," he says.

This point tends to get lost in the shuffle. It is often forgotten that more than just powering our cars, petroleum is deeply woven into the fabric of our daily lives. Adding up to a global consumption rate of about 86 million barrels per day, oil plays a starring role in agriculture, industry, infrastructure, and transportation. It heats our homes, paves our roads, and grows our food.

So what happens when the global demand for oil begins to outpace the supply? That’s the peak oil question.

"Peak oil is not theoretical. Everyone knows that oil is a nonrenewable resource," Heinberg explains, "so at some point our ability to continue increasing the supply will cease. Everyone knows that it will happen. It is just a matter of when."

Peak oil is inherently a geological concept, formulated by renowned geophysicist Marion King Hubbert. In 1956, as a researcher for Shell Oil, Hubbert presented his theory to the American Petroleum Institute, claiming that the oil output in the mainland United States would peak in the late 1960s or early ’70s. Though dismissed by his colleagues at the time, Hubbert was vindicated when US oil production peaked in 1970 and the nation became forever dependent on foreign sources of petroleum to meet its energy needs.

Hubbert had explained that the production of any petroleum reserve — a single oil well, a particular country, or even the entire planet — follows a similar bell-shaped curve (now referred to as the Hubbert curve). The logic is that as the supply is first tapped, there is a steady increase of oil output that ascends to a peak (or plateau), which represents the maximum amount of oil that will ever be produced from the designated source. As production descends the other side of the curve, the supply is not exhausted, but future yields will always be lower and more expensive to obtain.

For the past 10 years — as the price of crude oil has gone from $12 to $100 per barrel on the world market — scientists, geologists, petroleum experts, and concerned citizens have increasingly pondered the point at which the global oil supply will not only begin to wane but fail to keep up with surging demand.

Proponents of preparing for the impending peak in worldwide petroleum output often cite the steady decline of major oil field discoveries since the 1960s and the alarming number of oil-producing countries that have already hit their peaks. Considering the widespread role petroleum plays in the general day-to-day functioning of our society, an impending decline in overall global production is — to put it mildly — severely worrying.

"People assume that the other side of the peak will be an orderly transition," Lundberg tells us, "but we have no other experience to compare it to."

In 2005 the United States Department of Energy completed a study it had commissioned on the topic of worldwide petroleum depletion titled Peaking of World Oil Production: Impacts, Mitigation, and Risk Management. Popularly known as the Hirsch Report (for principal author Robert Hirsch), the study consulted a wide range of scientific and oil industry experts.

It painted a startling portrait: "The peaking of world oil production presents the U.S. and the world with an unprecedented risk management problem. As peaking is approached, liquid fuel prices and price volatility will increase dramatically, and, without timely mitigation, the economic, social, and political costs will be unprecedented. Viable mitigation options exist on both the supply and demand sides, but to have substantial impact, they must be initiated more than a decade in advance of peaking."

"It is one of the most important government reports of the last half century," Heinberg explains, "because it clearly indicates that this global event of peak oil is going to change everything."

Unfortunately, the Hirsch Report has been mostly ignored by Congress, the George W. Bush administration, and the DOE itself (which did not even publish the study for more than a year after its completion). However, the most troublesome aspect of the report is the fact that a sizable selection of the scientists and activists concerned with the topic believe that we’ve already hit the peak. They believe peak oil is happening right now.

PITCHING THE PEAK

"Most people in this country are energy illiterate," David Fridley says. "We can’t substitute millions of years of fossil fuels with something that we can manufacture in a factory, like biofuels. So most people don’t get this sense of anxiety about the situation we’re in."

Fridley knows a fair amount about energy. Currently a staff scientist leading the China Energy Group of the Lawrence Berkeley National Laboratory, he has spent a large portion of his career working in the Asian oil industry. His deep concern over the implications of peak oil incited him to play a key role in the formation of San Francisco’s task force.

"Having spent a year just thinking about this on my own," Fridley tells us, "and everyone around me telling me I was nuts, I decided to join a local group where I could at least meet up with others and see if we might educate people rather than just talking amongst ourselves."

In 2005, Fridley met Dennis Brumm — a veteran San Francisco activist with an address book containing an A-list of the city’s prime political players — who was looking to raise the city’s awareness of the issue.

Together with local activists Jennifer Bresee and Allyse Heartwell, they set their sights on bringing the issue of peak oil before the Board of Supervisors.

"Tommi Avicolli Mecca of the Housing Rights Committee is a friend of mine," Brumm explains, "so I invited him over to my house one night and had him discuss with us the personalities and quirks of the supervisors and their aides."

Having charted the terrain, Brumm’s small group soon began spending its Thursdays and Fridays for the next six months lobbying the supervisors at City Hall. When technical questions were asked, the group referred to Fridley’s decades-long experience in the industry for expert scientific analysis.

In April 2006, with backing from District 5 Sup. Ross Mirkarimi and District 1 Sup. Jake McGoldrick, the board passed Resolution Number 224, recognizing "the challenge of Peak Oil and the need for San Francisco to prepare a plan of response and preparation."

For Fridley, the resolution and the formation of the task force were matters of appropriate preparation. "We have two oil tankers come under the Golden Gate every day to fill up the local refinery tanks to produce the fuels that keep the Bay Area running," he says. "What would happen if those tankers don’t come in? Or they don’t come for a week? The city has no plan for that, but we have the ability to be better prepared."

HALF EMPTY OR HALF FULL?

When discussing the phenomenon of peak oil, Lundberg prefers to use the term petro collapse. It is a turn of phrase that quickly provides insight into his considerable sense of alarm for the days ahead.

"It is going to be a globally historic event," Lundberg says. "Imagine a nationwide version of [Hurricane] Katrina."

Although ominous in its predictions, Lundberg’s perspective is based on a long road of experience. While he ran the Lundberg Survey with his father in the 1970s, their widely read insider journal for the oil industry predicted the second great oil shock of the decade (in 1979). In the mid-1980s he moved on from the family business to form the Sustainable Energy Institute nonprofit in Washington DC, a move USA Today marked with the headline "Lundberg Goes Green."

As suggested by the title of the online magazine he currently edits — Culture Change — Lundberg has come to view the peak oil phenomenon as being primarily an issue of the American consumer lifestyle.

"We have this crazy way of life based on limited resources that are clearly becoming constrained," he says, "and we’re holding on to yesterday’s affluence without realizing that we have already walked off the cliff."

Chairperson Rosenmeier, one of Lundberg’s colleagues on the task force, is wary that such an explicitly bleak viewpoint may scare public attention away from the matter.

"You have to be careful with peak oil that you don’t immediately leap to ‘We’re all doomed and our economy is doomed,’<0x2009>" she says. "I think there is an intermediate phase, which is what we are being asked to address: the transition from business as usual."

An accountant by trade and a longtime Green Party activist, Rosenmeier ran for state treasurer in 2002, garnering about 350,000 votes. Setting an ambitious pace for her contribution to the report, she recently met with the Mayor’s Office of Economic and Workforce Development to request an analysis of how oil prices are related to the orientation of San Francisco’s economy. For this reason, she appears less concerned with predictions than with producing a heavily researched and well-structured report.

"I have a very strong vision of what I want the report to look like," Rosenmeier says. "I want us to have a uniformity and a more quantitative approach. I do not want to address the disintegration of our society."

The disparity between the views of Lundberg and Rosenmeier reflects the vast spectrum of opinions on how peak oil will manifest, although the extremes go well beyond them: some call peak oil a liberal hoax, while others have converted all of their assets to gold and prepared well-stocked and well-armed bunkers where they can ride out the social and economic storm.

The Web site LifeAfterTheOilCrash.net is now getting as many as 23,000 hits per day. Creator Matt Savinar, a graduate of the University of California Hastings College of the Law, abandoned his law career as a futile concern when compared to the implications of peak oil.

"It is pretty simple," Savinar tells us. "What do you think is going to happen when the oil-exporting countries like Russia, Venezuela, and Iran say, ‘We cannot export any more because we need to keep it for our own people’? The US will react by starting a war."

Although Savinar gravitates toward the most drastic of peak oil’s potential implications, his concerns are shared by some high-profile figures. Rep. Roscoe Bartlett (R-Md.), who has started the small but significant Peak Oil Caucus in Congress, has quoted Savinar’s work in congressional session, while billionaire Richard Rainwater told Fortune magazine he regularly reads Savinar’s site.

Pessimistic about the prospect of mitigating the effects of peak oil, Savinar characterizes the efforts of the San Francisco Peak Oil Preparedness Task Force as "throwing a wet rag at a forest fire." In swinging to the opposite end of the spectrum, the vast chasm between opinions on the matter manifests more clearly. Peter Jackson, the senior director of oil industry activity for the Cambridge Energy Research Associates, recently published the results of an in-depth analysis of more than 800 oil fields worldwide, concluding that the declining output rate of established fields is about half as low as originally expected.

"I think the danger of a peak [in global oil production] in the short term is minimal," Jackson tells the Guardian. "I think there are plenty of new developments on the books of oil companies, and the prospects for growth are good."

While Jackson acknowledges that at some point in the future it will be difficult to increase production, his optimistic viewpoint of the current situation helps to flesh out the dynamics of the overall discussion. As Heinberg explains it, "The debate really is between the near-peak and the far-peak viewpoints."

Yet even as Jackson attracts the ire of near-peak proponents such as Heinberg, he still acknowledges the need for swift preparation efforts. "There is still time to think about these issues and plan for the future," Jackson says. "But the sooner we do that the better."

EATING OIL, GROWING FUEL

Toward the end of the task force’s most recent meeting, the group discusses the city’s potential options for producing its own food supply. As Lundberg points out some of the particulars for pulling up pavement to plant crops, the exchange seems like an excerpt from Ernest Callenbach’s novel Ecotopia (Bantam, 1990).

"Streets cannot be pulled up as easily as driveways or parking lots," Lundberg explains. "There is soil immediately below a concrete driveway, whereas the earth beneath a street is much farther down."

This talk of tearing up asphalt to transform the city’s urban landscape into a viable agricultural venture may seem strange, until one considers how overreliant modern agribusiness has become on cheap fossil fuels.

"About one-fifth of all the petroleum we use goes into some part of our agriculture system," explains Jason Mark, the task force member focusing on the city’s food supply. "Whether that is through transportation and shipping, tractors and farm machinery, or the making of synthetic fertilizers and pesticides — it all demands oil."

Mark notes that the average American meal travels an estimated 1,500 miles from the farm to the dinner table, a startling figure that can be partly attributed to federal policies like the North American Free Trade Agreement that have encouraged export crops rather than diversified farming for local consumption.

"There is no way that San Francisco is going to feed itself in the short term," Rosenmeier says. "Food is going to be a gigantic issue."

In a larger sense, it already is. This past December the Food and Agricultural Organization of the United Nations urged governments to take immediate steps to mitigate "dramatic food price increases" worldwide. Meanwhile, a recent cover story in the New York Times ("A New, Global Quandry: Costly Fuel Means Costly Calories," 1/19/08) cited "food riots" in more than half a dozen countries and asserted, "Soaring fuel prices have altered the equation for growing food and transporting it around the world."

In the US, the Department of Labor’s Consumer Price Index cited a 5.6 percent increase of national grocery store prices in 2007, echoing sizable domestic price spikes in milk, corn, and wheat supplies.

"In a situation where you have sharp increases in the price of fossil fuels, you are going to see spikes in the costs and perhaps even the availability of food," explains Jason Mark, a former employee of Global Exchange and a graduate of the University of California at Santa Cruz’s renowned ecological horticulture program.

Mark now splits his time between editing the environmental quarterly Earth Island Journal and comanaging Alemany Farms. In his task force research, Mark plans to focus on two key challenges: increasing food production within San Francisco and improving both production in and distribution from the farms in the Bay Area.

"The city is pretty lucky because we are surrounded by all of this incredibly productive agricultural land," Mark explains. "If you were to draw a 100-mile radius around Potrero Hill, you could still have a pretty amazing diet."

Of course, the situation is far from simplistic. Climate change has proven to be a wild card in the equation, periodically negating dependable food supplies. Most recently, the entire Australian wheat crop collapsed due to a massive drought, affecting food imports around the world.

Less noticeable, though equally problematic, is the strain that biofuels are putting on food supplies. As increases in oil prices are stimuutf8g demands for alternatives, governments must decide whether crops should be used as food or fuel.

"Increasing our production of ethanol or biodiesel means direct competition with the food supply," Heinberg says. "In other words, we may see millions of people around the world going hungry so that a small percentage of the population can continue to drive their cars."

While such factors translate into a predicament as delicate as it is complex, Mark manages to elude pessimism. "I’m not one of these apocalyptic fetishists inciting for some sort of Mad Max scenario," he explains. "[The task force] is going to come out with a document that, although cautionary in scope, will be really optimistic about how SF can exist as an oil-free city."

GLOBAL WARNING

Amid a vast disparity of opinions from scientists and industry experts expounding both sides of the debate, the San Francisco Peak Oil Preparedness Task Force plans to release its final report in October.

As with the issue of climate change almost two decades ago, the task force members face a long climb toward making an impression on an American population that has shown considerable reluctance to alter its lifestyles.

And while the deliberation over the onset of peak oil is likely to see little decline among skyrocketing energy costs and increasing geopolitical hostilities, the underlying truth may already be far less complicated.

"The era of cheap oil is over," Lundberg says. "Period." *

The next meeting of the San Francisco Peak Oil Preparedness Task Force will be on Feb. 5 at 3 p.m. in room 421 of City Hall, 1 Dr. Carlton B. Goodlett Place, SF. Members of the public are strongly encouraged to attend.

————————————————————–

OIL ALTERNATIVES

In the event of sudden petroleum shortages, how do the alternatives stack up?

Ethanol: The Republican choice for weaning the nation off oil is a lucrative venture for red state constituents in the Midwest. However, the drawbacks are numerous. Corn ethanol requires almost as much oil energy to produce as it is meant to replace. Furthermore, it will require 4.8 billion — yes, billion — acres of corn to match the world’s current rate of annual oil consumption.

Hydrogen fuel cells: Touted by conservatives as some kind of miracle fuel because its tailpipe by-product is simply water vapor, hydrogen is a long way from being a viable fuel for cars, if that’s even possible. It takes even more energy to produce than ethanol and can explode in collisions.

Nuclear: Expensive and unpopular, nuclear power faces numerous logistical hurdles (particularly safety and long-term waste storage) that make it infeasible in the short and middle terms.

Natural gas: A major source of current United States energy consumption (25 percent nationally), natural gas is extremely difficult to ship, making importation from far-off sources impractical. Its supplies are running low in the US, and this nonrenewable fossil fuel is likely to parallel oil in its decline.

Wind: This clean power source is being quickly developed around the world as a major generator of electricity. Currently in the US, it accounts for about 1 percent of domestic electricity production, so offsetting the loss of fossil fuel plants would require a massive commitment. Downsides include the danger to migrating birds and the fact that sometimes the wind doesn’t blow.

Solar: This is Marion King Hubbert’s choice for replacing fossil fuels. It is a renewable generator of electricity, yet the shortcomings so far have been with finding more efficient and less toxic battery technology to store it. But improving research and strong consumer demand for solar panels point to a promising future.

Solar man

January 2, 2008

› steve@sfbg.com

GREEN CITY Two years ago Tom Price called me from the hurricane-ravaged Gulf Coast. We didn’t know each other, but he’d read some of my articles about Burning Man, including "Epilogue as Prologue" (10/4/2005), which culminated my seven-part series by looking at how burners were projecting their culture, skills, and ethos into the outside world.

The most obvious example I used was the group that went straight from Burning Man 2005 to Mississippi to help clean up after Hurricane Katrina, which hit during the event. "If that isn’t applying our ethos, I don’t know what is," Burning Man founder Larry Harvey said in my article. "The very skills needed to survive at Burning Man are the skills needed to respond to a disaster."

Price had been a little busy mucking out flood-damaged homes and rebuilding a Buddhist temple in Biloxi, Miss., but the he’d called home for the past five months had finally gotten an Internet connection, and he’d just found my article. "Dude, we’re still here," he told me excitedly by phone. "It’s happening just like you wrote. We’re doing it."

As I started to learn, Price was an accomplished idealist for whom "doing it" means working to save the world. In college in Utah he spent a year in a shanty he erected in the main college square urging the university to disinvest in apartheid South Africa, and his removal led to a court case that expanded free speech rights. He worked as a journalist chronicling threats to the indigenous Kalahari tribes in Botswana and as an environmental activist and lobbyist in Washington DC, where he eventually became the main contract lobbyist for Burning Man, an event he loves.

In Mississippi he turned an encampment of do-gooder burners into an organization he dubbed Burners Without Borders. Price spoke so passionately and eloquently about what they were doing that I just had to go, working with them (as both journalist and laborer) for a week and writing a Guardian cover story about the experience ("From Here to Katrina," 2/22/06).

It was a project and a moment that seemed to capture both the scale of the environmental problems facing this country and the enormous potential of motivated individuals to creatively deal with them.

From there Burners Without Borders went on to create a program that recycles the huge amount of wood used by the more than 40,000 people who now attend Burning Man every year, donating it to Habitat for Humanity for the construction of low-income homes. And the group has sent contingents to do cleanup work after floods in the Pacific Northwest and cleanup and reconstruction in Pisco, Peru, after the massive earthquake there in 2007.

Price became the first environmental director for Burning Man, reflecting its Green Man theme last year.

One of the most notable projects to grow from that endeavor finally came into full bloom Dec. 18, 2007, when a 90-kilowatt solar array — some of which was used to power the eponymous Man at last year’s event — was placed in the town of Gerlach, Nev., as a donation to the Washoe County School District.

It will give the school free, clean power for the next 25 years, saving the district about $20,000 annually — money that can surely be put to better use than paying for fossil fuels.

The project was a joint venture between venture capital firm MMA Renewable Ventures (which put up the money), Sierra Pacific Power (which offered a substantial rebate for the project), and the Price-led burners who donated their labor.

"MMA put up the money, and the rebate from the utility paid back almost all of it, with the difference made up by Burning Man and its volunteers," Price said.

Price said 10 volunteers — including Eli Lyon, Matt Deluge, and Richard Scott, who were in Pearlington, Miss., with us — worked eight hours per day for 51 days to do the work that made the project pencil out.

Matt Cheney, CEO of MMA Renewable Ventures and a resident of Potrero Hill, said he approached people he knew at Burning Man a year ago, wanting to help the event’s new green goals. "One of the simplest ways to do it was to green up the Man with solar," he said.

Price helped guide the project past the anticorporate sentiments of burners. "A lot of people were afraid that Green Man would spell the end of Burning Man because there was corporate participation," Price said.

Instead, this creative partnership has become a model for the future and a job for Price, who is now executive director of the new nonprofit Black Rock Solar, which aims to replicate the Gerlach project at schools, hospitals, and other public institutions in Nevada and other states.

"We’re taking fiscal capital and social capital and combining them in a way that’s really never been done before," Price said.

John Hargrove, who runs the rebate program for Sierra Pacific Power, agrees the burners have created an entirely new model.

"They’re able to do installations that wouldn’t get done otherwise," Hargrove told the Guardian. "Clearly, they are donating a tremendous value to the project. The Burning Man, Black Rock Solar people are very unique. They’re not in it to make money."

Yet the model they’ve created allows capitalists to make money, albeit at lower returns, by tapping into a universal sense of goodwill and a desire to save the planet.

"We call this not-for-profit work. We’re operating on metrics where we don’t have to make our typical returns," Cheney said, noting that the price points for this project were about 25 percent lower than for a typical big solar project. And he thinks the undeniable public benefits of projects like this will attract more support from powerful players in the public and private sectors.

"It was the right moment in time to do something like this," Cheney said. "It’s one of those good ideas that happened at the right time and has taken on a life of its own."

www.blackrocksolar.org

www.burnerswithoutborders.org

Comments, ideas, and submissions for Green City, the Guardian‘s weekly environmental column, can be sent to news@sfbg.com.

No more dam discussion

July 25, 2006

EDITORIAL The state Department of Water Resources released a long-awaited study July 19 concluding that restoring Hetch Hetchy Valley would cost at least $3 billion and possibly as much as $10 billion.
Let us put this in perspective.
The state of California is facing extreme pressure on its electrical grid because of record high heat. If this is an early sign of rapid and dramatic climate change (and that’s a very possible scenario), then the problem is going to get worse before it gets better. Most electricity in this country is generated by burning fossil fuels, which contributes to global warming, which puts more pressure on the grid…. It’s getting so bad that some desperate environmentalists, flailing around for answers, are starting to argue that nuclear power might be an option.
Renewable energy? Gee, the experts say: It’s just not financially feasible right now.
And with some very scary problems looming, the state is actually talking about tearing down a hydroelectric dam that provides clean electricity for 200,000 homes — and spending $10 billion to do it.
This is insanity.
The O’Shaughnessey Dam, which holds back the Hetch Hetchy reservoir, flooded a spectacular Sierra valley, breaking the heart of conservationist John Muir. Even the San Francisco Chronicle, which supported the dam and attacked Muir about 100 years ago, now agrees that it was a mistake.
But there’s a lot more to the story. For starters, the compromise legislation that gave San Francisco the right to build the dam required the city to use it as the centerpiece of a public power system — a legal mandate that the city defies to this day. As long as the dam is generating power, it offers a huge opportunity for San Franciscans to get out from under the private power monopoly of Pacific Gas and Electric Co. And while hydroelectric dams have serious environmental problems, they don’t create greenhouse gases — and a dam that’s been around this long is actually a fairly ecologically sound way to generate power.
The price tag for wiping out the dam is staggering — and from a purely environmental perspective, spending that cash on this scheme would be a gigantic mistake. For $10 billion, California could undertake a huge crash program in developing renewable energy, spurring a lucrative industry that would create tens of thousands of jobs. With that kind of money behind it, solar power would not only be competitive, it would be cheaper than other forms of electricity. And the state would be leading the nation into a new era of safe, clean power.
Sure, in 50 years when solar, wind, and tidal power provide 90 percent of the state’s energy needs, and California has joined Nebraska in outlawing private electric utilities, and there’s money to burn … then restoring Hetch Hetchy Valley will be a fine idea. But for now it’s time to put this foolishness to rest. San Francisco — which, after all, owns the dam — should take the lead here. The supervisors should pass a resolution stating that the city will not consider any further proposals to tear down the dam — at least not until the city’s and nation’s energy policies have advanced a long way in a very different direction. SFBG

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