Getting and Staying in the Club

Intervenor access and compensation are at the heart of many major energy issues. They?'e an undercurrent in the governor's plan to transfer transmission line permitting to the California Energy Commission as part of his energy agency reorganization. The Energy Commission, unlike the California Public Utilities Commission, does not have intervenor funding authority. Failing to address that omission could cut skilled, but underfunded, public representatives out of the transmission siting loop if the agency overhaul proposed by the governor is enacted. Some say the administration's reorg is dead on arrival. Others aren't so sure. Regardless of its outcome, the tug of war between agencies over transmission line permitting casts light on the flaws of the intervenor compensation scheme. That includes an arcane administrative process that creates barriers to public involvement in energy rulemaking and practice. More worrisome is that the proposed new agency under the governor's wing has no provision for compensating public intervenors for their efforts. Legislation would be needed to close the gap for intervenor access and funding for any newly reorganized agency-but none is in the works. Furthermore, there is no functional equivalent of the Office of Ratepayer Advocates, which was created to protect utility customers' pocketbooks under the umbrella of the CPUC. Intervenor funding is aimed at ensuring that more voices than those of the utilities and big business are considered to protect consumers from being ripped off. While intervenor rules need much improvement, they do help foster various perspectives on myriad issues, including rates, the types of power available, and rules governing a regulated and hybrid market. "Not that it levels the playing field, but it at least lets the public on the field," said Rochelle Becker, who represents consumers and antinuclear organizations. Before the 1980s, intervenors participated at CPUC hearings at their own risk and their own cost. All consumers were supposed to be represented by the commission staff and the then-Division of Ratepayer Advocates. There were no state-sponsored representatives from the environmental community. The mover and shaker behind intervenor funding was The Utility Reform Network's founder Sylvia Siegel. She insisted that the Legislature provide compensation when public intervenors' participation saved ratepayers dollars. Public involvement at the Energy Commission is a fraction of what it is at the CPUC. Those few outsiders who get involved in the Energy Commission's power plant siting process do so on their own dime. One of the very few intervenors at the CEC's intervenor fundless proceedings has been the California Unions for Reliable Energy. CURE was also the subject of a failed bill to prevent its involvement because of claims that it raised environmental concerns in plant siting cases to ensure that unionized workers were hired. The CEC did put together a special process this year that allowed for intervenors to participate in the development of its Integrated Energy Policy Report, with reimbursement contingent on their also participating in the CPUC procurement process. That is a hopeful sign. Intervenor funding, while much welcome, comes with rules that limit payment to participants deemed to have helped shape a CPUC final decision. If an argued position doesn?t past muster, then payment is chopped or denied, limiting the diversity of bona fide views. In addition, the rules governing public participation in CPUC proceedings are complex and the subject matter often arcane, while reimbursement of participants? costs and expenses takes a long while. This places formidable burdens on those unfamiliar with the CPUC's process and on nonprofits with limited resources. "The most difficult part is finding funding up front to participate, and then wait six months, a year, or longer, for compensation," Becker, an experienced intervenor, said. Another problem with the intervenor package is the rules governing recovery of participation costs arising from appellate challenges. Investor-owned utilities' legal fees are underwritten by ratepayers'it's a business expense that's never questioned by the CPUC. Businesses' legal deep pockets come from shareholders or members. Both usually have the financial resources to fight to protect their interests to the bitter end. That includes exhausting the regulatory process, filing suits, and appealing to a higher court. Whether and under what conditions intervenors can collect compensation for appealing are the subject of a dispute between TURN and the CPUC. The outcome could have major ramifications for the public's voice. Aggravating the risk of severe laryngitis is that the Office of Ratepayer Advocates does not play a role in appeals. ORA lacks its own legal staff and taps into its sister agency's legal department, which, not surprisingly, creates conflicts of interest. Legislation by Senator Martha Escutia (D-Whittier) would give ORA its own legal counsel, along with budget independence (Circuit, April 8, 2005). Her bill, SB 608, will be heard by the Assembly Utilities and Commerce Committee June 27. A recent compensation claim of TURN's was slashed because it wasn't on the winning team. It appealed a closed-door deal the CPUC reached with Southern California Edison on post-crisis rate recovery. A majority of CPUC members voted to cut TURN's $1 million claim by more than $700,000 because it failed to get the deal overturned. Thus, they ruled, the advocate failed to meet the "substantial contribution" test required by the intervenor compensation regulations. If that ruling stands-TURN has sought a rehearing and will take the matter to court if necessary-public participation in the appellate arena would largely be missing in action. Consumer advocates would limit their appeals to matters they felt had a strong likelihood of prevailing to minimize their financial exposure, a Capitol insider noted. This would further tilt the playing field in the utilities' favor because they have the resources to appeal decisions they are unhappy with-unlike their intervenor adversaries. Legislation was considered last year to clarify the compensation standard for intervenors' appellate work. As part of a compromise reached with the Senate energy committee, the bill sponsor agreed to wait for an audit that revealed how many-or few-CPUC challenges the appellate courts agree to hear. Barriers to participation by inexperienced intervenors is also a major issue. In addition to complex eligibility rules and inadequate assistance for new intervenors, the biggest barrier is "learning the commission's procedures, mastering the jargon, and translating the intervenor's message into a format that can penetrate the incestuous little club that dominates the regulatory proceedings," stated Barbara George, executive director of Women's Energy Matters. Legislation by Escutia aims to boost public involvement by easing the rules governing claims for participants representing small ratepayers. SB 951 was turned into a two-year bill but hopefully will have better luck next year. It states that it is the Legislature's intent to promote and encourage public participation in commission proceedings and declares that reimbursement of intervenors' costs of participating in commission proceedings, "where that participation substantially contributes to orders and decisions of the commission, is in the public interest." Intervenor rules as applied to the CPUC, the CEC, and/or the new Department of Energy should be improved and expanded so the public door is open?and to more than professional intervenors. Bona fide entrants should be able to at least recover their costs for copying, phone calls, and expert witnesses. Providing a diversity of voices on issues would also enrich the social debate on energy issues.

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Getting and Staying in the Club

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