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California to Unify Energy Policy and Planning
to Ward Off Future Energy Crisis
By Allison
A. Davis
[May 2003]
In two different forums, California government entities continue
to implement changes reacting to the California energy crisis of
2000 and 2001. Each of these initiatives is aimed at unifying energy
policy and planning in California.
On May 8, the California Public Utilities Commission (PUC) became
the last of three California energy agencies to approve an “Energy
Action Plan.” The Consumer Power and Conservation Financing
Authority, commonly called the “California Power Authority”
(CPA), and the Energy Resources Conservation and Development Commission,
commonly called the “California Energy Commission” (CEC),
were the first agencies to endorse the plan. The plan identifies
six areas of action to ensure reliability and reasonably priced
energy while emphasizing environmental concerns. In an unprecedented
move, the CPA, CEC and PUC have committed to actively cooperate
in implementing the following:
- Optimize energy conservation and resource efficiency
- Accelerate the state’s goal for renewable generation
- Ensure reliable, affordable electricity generation
- Upgrade and expand the electricity transmission and distribution
infrastructure
- Promote customer and utility owned distributed generation
- Ensure reliable supply of reasonably priced natural gas
PUC Commissioners Lynch and Wood dissented from the plan, especially
its emphasis on competition and market forces. Lynch and Wood instead
want to strengthen the regulated utilities and criticized the plan’s
goal “to work with FERC to redesign markets.” Instead,
they “oppose FERC’s efforts to invade areas of state jurisdiction.”
They also felt the plan was too specific in voicing certain of its
goals, without the benefit of an evidentiary record being developed
in formal proceedings. For a copy of the Energy Action Plan, see
the PUC’s website at www.cpuc.ca.gov.
Separately on May 8, the California State Assembly Committee on
Utilities and Commerce unanimously approved legislation (11 voting
for, 3 absent) to establish a new Energy Agency. Bill AB 808, introduced
by Bay Area assemblyman Joseph Canciamilla, would replace the CEC,
the CPA and the policy-related activities of the PUC as well as
abolish the Electrical Oversight Board. Given the multiplicity of
and often unclear jurisdictional lines among the legislative and
administrative bodies charged with responsibility for developing
and implementing California energy policy, there have been previous
attempts to centralize California energy policy. Last year’s
energy policy centralization bill (AB 1661) died in committee and
other efforts did not get this far.
AB 808 would establish a cabinet level energy secretary appointed
by the governor. To become law, the bill will next move to the Assembly’s
Appropriations Committee, the state Senate and the Governor’s
office. The bill has garnered support by Pacific Gas and Electric,
the California Chamber of Commerce and the California Business Roundtable.
The California Municipal Utilities Association (CMUA) opposes AB
808, pending the state’s determination of the eventual electricity
market structure. The CMUA is also insisting that any energy policy
consolidation measure should limit (or eliminate) any continuing
role for the ISO (California’s independent system operator
that controls access to electric transmission) in ensuring reliability.
For a copy of the bill, and related analyses, see www.assembly.ca.gov.
Published by Davis
Wright Tremaine's Energy Law Group
Any questions about this Advisory should be directed
to:
Allison A. Davis,
San Francisco, (415) 276-6580, allisondavis@dwt.com
Steven F. Greenwald,
San Francisco, (415) 276-6528, stevengreenwald@dwt.com
This Energy Advisory is a publication of
the Energy Department of Davis Wright Tremaine LLP. Our purpose
in publishing this Advisory is to inform our clients and friends
of recent developments in energy law. It is not intended, nor should
it be used, as a substitute for specific legal advice as legal counsel
may only be given in response to inquiries regarding particular
situations.
Copyright © 2003, Davis Wright
Tremaine LLP.
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