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To paraphrase B.B. King, "The fear is gone." I don't know if it's "gone away for good," but the public's fear of energy policy, politicians' fear of investing huge sums of money to change traditional supplies, delivery, and leadership, and the just plain old fear of the complicated energy learning curve just dissolved like ice cubes in a July heat storm in 2006. Now that the year is coming to an end, I'm pondering these massive changes in the energy industry in the last 12 months with the institutional memory of the last 24 years. With unfortunate thanks to global warming, heat storms, and $3/gallon gasoline, a growing number of average citizens now have a clue about energy policy. It is seeping into people's consciousness via blogs, the "Daily Show," and nightly network news. I've been an energy beat reporter since the mid-1980s, and this is an amazing sea change in public consciousness. The only people who worried about energy 20 years ago were the folks literally in the boiler room, a scattering of regulatory attorneys, and some antinuke activists. Back then, people took energy for granted. Rates crept up, but fairly imperceptibly. Commercial customers were getting lower rates than residential customers because they used more energy, on the theory that it was an economy of scale. With Pacific Gas & Electric's Helms Pumped Storage Plant and its Diablo Canyon nuke, as well as Southern California Edison's (and partially San Diego Gas & Electric's) two new units at the San Onofre Nuclear Generating Station, coming into the rate base in the 1980s, the price of electricity in California became noticeably higher. In the early 1990s, a few California Public Utilities Commission staffers' theory that a deregulated market would put downward pressure on the price of electricity began getting traction. The concept was also being promulgated in academic circles. The public began to actually attend some CPUC meetings - which, up until then, were terse affairs with little discussion, even among commissioners. Representatives from the California Large Energy Consumers Association and some other commercial groups began threatening that they would leave the state if rates didn't come down. Instead of the people in the boiler room watching energy prices, corporate concern migrated to policy levels. Company vice-presidents and general counsels became involved. They, too, thought that deregulation - particularly the option of direct access to energy provided by entities other than utilities - would lower their ever-increasing rates. Enron's lawyer was there, prying open the gates to a deregulated future. With economic pressures from businesses and Enron, I observed the commission grappling with the theoretical side of deregulation. Regulators - Republican nominees at the time - thought it generally a good idea. However, they had differences of opinion on how implementation should occur. That was a decade ago. To give you an idea of how "modern" the commission was at the time, its president, Dan Fessler, could not imagine mandating more area codes for phones. He just couldn't deal with having to dial 10 digits to make a call. He reminisced about having an operator you called, just giving a person's name, and getting hooked up. The commission was thinking rotary dial at best. Commissioners also couldn't imagine one other thing: While they thought deregulation might cause prices to be competitive and fall, they didn't seriously weigh the possibility that it could cause companies to take advantage of the game and that prices could rise. Despite those odds, still only a few people outside the inner workings of regulation paid any attention to energy policy. Deregulation then went to the Legislature. I watched while most politicians - even on the energy committees - ducked and ran from the issue because it was so difficult and complicated. Former Senate Energy, Utilities, and Commerce Committee chair Debra Bowen was one of the few wonks who wanted to stick around. She told me that she almost ducked and ran but became fascinated with energy policy's intricacy and its enormous effects on our environment and economy. Because most politicians did not want to mount the energy learning curve, Senator Steve Peace was bequeathed his leadership position on the deregulation law. There, he forced lobbyists and politicians to create something new and different that would put California in the position of leading the nation. When the bill was presented to the Senate and Assembly floors, no politicians really opposed it because none of them knew what the heck it was about - again seeing energy as too complicated. Peace's leadership, and the sheepishness of most politicians at the time, certainly led to California breaking new ground on the energy front. California did lead the nation in something different energy-wise - the 2000-01 energy crisis. The crisis happened so fast. I did not witness a learning curve even then, just radical reactions to runaway events. People seemed too scared to comprehend. Governor Gray Davis lost his job in large part because of the crisis. I've never had a conversation with Governor Arnold Schwarzenegger about this, but apparently he "got the memo" on energy - the one that said: "In order to lead, don't be afraid of the learning curve, don't be afraid of big ideas, and don't be afraid of spending today's money for future responsibilities." It seems the public is paying attention to the Million Solar Roofs initiative, if my Thanksgiving dinner conversations were any indication. For instance, I learned from my seat-mate at one dinner that smart meters don't run backwards, they only go to zero, and that there is developing photovoltaic technology that can use ambient light, not full sun, to produce electricity (which brings up the metaphysical question: if you are powering your light bulb with the ambient solar, where do you start to lose energy?). It seems people really are paying attention to global warming - although some of them are loath to give up their SUVs. Those Thanksgiving dinners in which energy was a common thread included rural housewives, blue-collar workers, union workers, teachers, and Ph.D.s. For the first time in my life in a nonwork environment, those surrounding me all knew something about energy policy. A quick look at my personal, as well as editorial, e-mail reveals the same thing. The British company known for drilling lots of oil, BP, is touting alternatives. PG&E says anti-global warming policy is the wave of the future. (Pinch me when ExxonMobil says the same thing.) In the last couple of weeks there have been two Wall Street Journal front-page articles on solar photovoltaics. I see lots and lots of money chasing alternative fuels and energy research and development - even though Proposition 87 did not pass. Suddenly, it seems like everyone gets it. Suddenly I can start talking about energy policy at a party and not have everyone move away from me to the more interesting guests. That's a real victory for the folks that read Circuit. You cannot force-feed base-level knowledge when people fear the learning curve. But when they have already mounted the learning curve through media osmosis, then vital public debate, or enthusiasm, can ensue. The gift that 2006 has given me is that suddenly people seem willing to embrace a cleaner energy future. (BTW, I do NOT want to know the sales figures of plasma televisions for the holidays.) There's still a long way to go, but it's a start, and you should all feel pretty good about this state and its energy future. - J.A. Savage

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