California attorney general Kamala Harris’s agents wasted no time after this column in late January called for a criminal investigation of the former state Public Utilities Commission President Michael Peevey.
Less than five days later, investigators executed a search warrant at Mr. Peevey’s primary home in La Canada- Flintridge.
Scope of the investigation might not be broad enough.
Egregious as his alleged acts have been, Mr. Peevey could not have acted alone in securing sweetheart deals for California’s largest regulated utilities, Pacific Gas & Electric Co., Southern California Edison Co. and the San Diego Gas & Electric Co.
Utility executives discussed arrangements with him, and one of the state’s leading consumer advocacy groups often played along with whatever he did. Plus, fellow commissioners never voted him down.
What Is a Kabuki Dance?
It all stems from the longstanding PUC kabuki dance, an elaborate routine conducted by the commission, the utilities and the consumer advocate group TURN – The Utility Reform Network.
In this exercise, whenever each utility files for possible rate increases, it seeks far more than is justified. The commission cuts the request down, taking credit for holding the line, and TURN boasts of saving the public hundreds of millions.
Demonstrating the phony quality of all this, TURN’s former chief lawyer, Michael Florio, a PUC member since 2011, is under investigation for allegedly helping PG&E, his onetime “adversary,” find a sympathetic administrative law judge to hear a rate case.
In reality, everyone knows the general outlines of the outcome before any rate-case exercise begins. This is performance art, not the prudent regulation called for by California law. It now sees Californians paying the third highest power rates in the lower 48 states (http://www.eia.gov/electricity/monthly/epm_table_grapher.cfm?t=epmt_5_6_a).
Extraordinary examples of apparent corruption became clear during the 12-year Peevey era, predictable the moment ex-Gov. Gray Davis named the former Edison president and husband of Democratic state Sen. Carol Liu commission president. This classic case of putting the fox in charge of the henhouse was reinforced when Mr. Peevey got a second six-year term from Mr. Davis’s successor, Gov. Schwarzenegger.
Links Are So Intimate
Just how connected Mr. Peevey has been was clear at an early February gala honoring him in San Francisco shortly after investigators searched his home. Sponsors of the $250-a-plate dinner included his successor Michael Picker, Energy Commission chairman Robert Weisenmiller, former Democratic gubernatorial candidate Kathleen Brown (sister of the governor and a board member of SDG&E’s parent company), former Assembly Speaker Fabian Nunez and several ex-members of Congress.
Most egregious of Mr. Peevey’s actions may have been his manipulations to let PG&E off easy after its negligence (the term used by federal investigators) led to the 2010 San Bruno gas pipeline explosion that cost eight lives.
For one thing, Mr. Peevey and fellow commissioners who fell meekly in line behind him still have not tracked the billions of dollars paid by utility customers since the 1950s for gas pipeline maintenance that was done only on a spotty basis.
It has emerged that Mr. Peevey personally signed off on an exemption allowing his old pals at Edison to replace steam generators in their San Onofre Nuclear Generating Station without a formal review of the $680 million cost, which consumers began paying long before the generators were installed and then failed, causing the plant to be retired. Other emails earlier showed Edison executives knew the generators were flawed before the installation.
Mr. Peevey couldn’t do much of this alone. Almost all of it required cooperation or at least acceptance by other commissioners, the utilities and TURN, the consumer advocate group that helped “negotiate” last year’s settlement that will see customers pay more than $3.3 billion out of about $5 billion in San Onofre closure costs. Of course, the fault for that failure lies with Edison and its supplier; no one has yet explained why consumers should pay anything.
Because so many parties have been involved in so many shady dealings, along with the kabuki dance common to all rate cases handled by the PUC, it is clear the long-term theft of billions of consumer dollars involves far more persons and companies than just Mr. Peevey. AG Harris’s office won’t say whether its investigation might broaden to include a potential conspiracy.
But legislative hearings to be chaired in mid-March by Democratic Assemblyman Anthony Rendon of Lakewood just might explore this, Mr. Rendon said.
All aspects of this investigation should consider whether a wide conspiracy went far beyond one man’s possible criminal actions.
Mr. Elias may be contacted at tdelias@aol.com. His book, “The Burzynski Breakthrough, The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It,” is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net
I am writing to you with regards to PUC Pres Peevey and our current situation/dealings with Peevey and So Cal Edison Edison
Our (City of Duarte) has observed a culture of lax regulation under the leadership of former PUC President Michael Peevey, associated with congenial affairs and shady dealings with utility officials. Including shared meals, vacations and wine in addition to conversations about project approvals, rates and other official business communications.
The project in question is the So Cal Edison TRTP project that spans through So California. An article (link attached) titled “PEEVEY IN THEIR POCKET”
The CPUC, former commissioner communicated regularly with Edison officials. Peevey had been president of Edison and its parent for less than three years, leaving in 1993 when he was in his mid 50’s
The Peevey/Edison relationship is snug indeed. Example: Ron Litzinger, executive vice president of Edison’s parent, “has Peevey’s cell number and they talk on weekends.
Some background…Edison erected towers along the ROW (right of way) in Chino Hills, Santa Clarita, Ontario. These towers are over 250’ tall and sit smack dab in folks back yards. Chino Hills struggled a 4 year battle to have the lines buried underground. $4.3 million dollars was spent by the City to fight this battle. The case even went the Supreme Court, who determined they did not have proper jurisdiction on the case. It was to be handled and decided by the CPUC leaders. A great deal of fighting, protesting, and folks from Chino Hills and Duarte physically going to Peevey’s So Cal residence at all hours of the day and night with marches and rallies. After this 4 year battle, Chino Hills won the vote of the PUC to bury the power lines underground. Peevey was the deciding vote in yay or nay verdict. Peevey voted to have the lines buried in Chino Hills. Burying 500KV power lines underground has never before been done in California, or throughout the country for that matter. This verdict rocked SCE’s world, as it would cost $382 million to remove the existing towers and bury underground.
Prior to this decision, there was a very cozy relationship with Southern California Edison, Peevey’s former company. This has affected decisions on San Onofre. There was also influence-peddling in decisions on the 2007 San Diego fires, caused greatly by SDG&E’s negligence. The power that Mr. Peevey possessed with SCE is mind boggling. With all these rumors coming to surface, he had to do something to throw everybody off the trail of deception. He voted AGAINST SCE in the Chino Hills formal hearing to bury the lines. Of course rumors are also flying that Peevey took advantage of some of the $4.3 million dollars spent. I contacted Picker directly by text regarding this. Asking “Duarte has been asking for the power lines to be buried for 4 years! We’ve been ignored by CPUC and Edison, even after filing a formal complaint with over 700 signatures.” His (Pickers) response via text was: “I wasn’t there then, and probably would not have supported Chino Hills. I really agree about how our onerous and arcane process freezes normal folks out. It’s usually fair for anyone who can manage the pain, torture and has millions at their disposal.” Meaning, it’s ALL ABOUT THE MONEY. And throwing the wolves off the scent of the cozy relations between SCE and Peevey.
In our (Duarte) City, Peevey came out to view the horrific towers in our back yards. He visited with SCE execs Ron Litzinger and Leslie Starck. Peevey claims to have been disgusted. On the sly, SCE official (President at the time) Ron Litzinger asked Peevey what they should do to avoid conflict and a another possible Chino Hills situation for SCE. On the advise from Peevey, SCE secretly purchased the two homes closest the towers. 1 home was literally 10 feet from the base of this monster, the other about 25 feet. This was all done very hush hush. Our neighborhood effort to bring the towers down turned into a payoff by Edison to these two homeowners. Leaving the rest of us (only 75 & 100 feet away) out in the cold. Edison paid off these homeowners almost a million dollars each to sell their homes along with compensation for relocation, future property taxes and pain and suffering. This was all done on the sly, and those folks were required to sign confidentiality agreements. I personally have been unsuccessful in getting anywhere with Edison, and PUC complaint was documented as a “note on file” but not a formal complaint.
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