Proposition 16 Would Place Limits On The Way Electricity Can Be Delivered
Wednesday, May 12, 2010
Proposition 16 on the June ballot would place limits on the way electricity can be delivered to our homes... and by whom. The issue is shaping up to be an epic showdown between small non-profit energy providers... and the San Francisco-based utility giant P-G-and-E. For the California Report, here's Amy Standen.
Proposition 16 on the California June ballot would place limits on the way electricity can be delivered to our homes. The issue is shaping up to be an epic showdown between small non-profit energy providers and the San Francisco-based utility PG&E. For the California Report, here's Amy Standen.
AMY STANDEN: When opponents of Proposition 16 got together on a panel in San Francisco earlier this year, it didn't sound like a discussion on utility policy. It sounded like a revival meeting.
ROSS MIRKARIMI: And let me tell you something, not since the Reagan administration, have we seen an offensive like this, I mean...
STANDEN: This is Ross Mirkarimi, a member of the San Francisco Board of Supervisors.
MIRKARIMI: Prop 16 is that final cross to bear. ("Bravo, Ross!") If we allow any of this...
STANDEN: Prop 16 would influence the way that electricity can be delivered in California, but to understand why it inspires so much passion, it helps first to understand the way things work now. So imagine a big pool of electricity. Some of it comes from natural gas plants, some of it comes from coal-fired plants out of state. And some of it comes from renewable sources, like wind turbines and solar panels. Now, between this big pool of electricity and your house, there is a middleman, a broker. A utility like SDG&E or, in other parts of the state, Pacific Gas and Electric, PG&E. It takes electricity out of the pool, delivers it to your house, and sends you a bill. But just north of San Francisco, there is a non-profit group called Marin Energy Authority. Charles McGlashan chairs its board. He says they can do a better, greener job.
CHARLES MCGLASHAN: We know that we can double the renewable power, we can offer deep green, a 100 percent renewable energy for pennies.
STANDEN: As of last week, customers in Marin can now choose between PG&E and the Marin Energy Authority. The transmission lines haven't changed, customers' bills look the same. But Marin Energy Authority says it is delivering greener energy at or below utility prices.
MCGLASHAN: And the reason we can do that is we don't pay corporate profits, we don't pay a CEO $9.5 million a year, and we don't have to pay taxes.
STANDEN: So, in the long run, can these community-run nonprofits do a better job than a massive power company founded a century ago? There's some debate about that. Here's Severin Borenstein, he's an economist at the University of California, Berkeley.
SEVERIN BORENSTEIN: The fact is that green power still costs more than conventional power. So it's very unlikely that they're going to be able to buy more green power, and at the same time, have lower costs.
STANDEN: But Proposition 16 doesn't really address this debate directly. What it does is make it harder for groups like the Marin Energy Authority to come into being at all.
GREG LARSEN: Now I can hear you. Okay, I could hear you both times.
STANDEN: Meet Greg Larsen. He's a spokesman for the almost entirely PG&E-funded Yes on 16 campaign, also known as...
LARSEN: The group I represent is Californians to Protect Our Right to Vote.
STANDEN: If Proposition 16 passes, public power proposals like the one in Marin, would have to face a county-wide election, and pass by a two-thirds majority.
LARSEN: We're not saying don't do it. We're not saying any approach is better than another. All we are saying is that if you want to go forward to do this, have the people vote on it.
MINDY SPATT: It makes it almost impossible.
STANDEN: That's Mindy Spatt, of The Utlities Reform Network, or TURN, a consumer advocacy group which opposes Prop 16. She says what the proposition boils down to is a single company trying to protect its turf.
SPATT: What we see with Prop 16 is a classic case of a special interest ballot initiative that is on the ballot because of nothing except money.
STANDEN: If Prop 16 fails, PG&E, and other utilities will likely lose customers. But so far, PG&E is the only utility to finance the campaign. The company has spent almost $35 million promoting Prop 16. The other side? The No on Prop 16 camp has spent just $35,000, almost all of it from TURN, the 15-person advocacy group that Mindy Spatt works for. She says they're almost tapped out.
SPATT: Laughs It's nickels and dimes at this point. People is what we have, and money is what PG&E has.
STANDEN: Meanwhile, a group in San Francisco is racing to put together its PG&E alternative before the election in June. The question is whether anyone else will follow suit. For KPBS, I'm Amy Standen, in San Francisco.