Public-Goods Funds Only Partially Public

By Published On: September 15, 2006

Only part of the ratepayer money used to fund renewables, efficiency, and other alternative projects handled by the California Energy Commission was allocated to projects in the investor-owned utility territories, according to a study released September 11. Of the total $6.4 billion collected from utility customers over eight years for two CEC programs, between 32 percent and 70 percent was spent on projects in investor-owned utilities’ area from which the money came, concluded the report, Following California’s Public Good Charge, by the University of San Diego Law School. The study looked at money used to fund the CEC’s Renewable Energy Fund and Public Interest Research Program. About 70 percent of the total funds collected from Pacific Gas & Electric customers returned to their region. At the other end was Southern California Edison, with only 32 percent of its total ratepayer contributions coming back into the territory. San Diego Gas & Electric saw half of its ratepayer funds spent on projects in its region. The return of program funding to its original source differed when broken down by program. Of the Edison customer funds allocated to the Renewable Energy Program, 40 percent came back in the door. Of SDG&E ratepayer funds allocated to the same program, 43 percent returned, while PG&E territory received 62 percent of the funds its customers paid out. A consumer group was concerned about the shortfall in return to the territory of origin. “Since the CEC has taken over control of these R&D funds, we are not aware of even one significant new energy-efficiency technology breakthrough that has been achieved or pushed into commercial availability,” said Don Wood, Pacific Energy Policy Center senior adviser. Unless the PIER program starts to soon produce effective new energy-efficiency technology, “we should consider giving control of ratepayer R&D efforts back to the utility,” he added. According to the study, the shortfall between expenditure and return was attributed to a variety of factors. They include a $150 million transfer of the program funds to the state’s general fund. Nearly $3 million is held in the programs’ funding balance; another portion is for encumbered but unexecuted projects, as well as administrative funds and funding of out-of-state projects. Part of the spending levels was also determined by the number of new and existing renewables projects, stated the study’s authors.

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