California Cities Banning Natural Gas Have Cooked up a Controversy


As electricity rates soar and rolling blackouts due to high demand and old equipment become another thing Californians have to deal with, questions are being raised on how to keep rates low for residents. As it is, Californians currently pay twice as much for electricity as neighboring states like Nevada and Oregon.

According to a new article in the Wall Street Journal, California's Public Utilities Commission's Public Advocates Office teamed up with the Sierra Club to push cities away from natural-gas hookups in new buildings. The ban is born out of a goal set by California lawmakers to transition the state away from generating electricity from fossil fuels and toward renewable sources of energy, such as solar and wind power. The expense however of replacing natural gas appliances with electric ones is an expensive proposition and would only increase the demand on an already strained and aging electrical grid.

With about three dozen cities already signed on, SoCalGas is fighting back against the bans and calling out the Public Advocate's Office for straying away from its original mission of keeping rates low for ratepayers.

In a piece published on CalMatters.org, Timothy Alan Simon, commissioner emeritus at the 'California Public Utilities Commission,' says the California Public Utility Commission's Independent Public Advocate Office has strayed away from its original role of advocating on the behalf of ratepayers. Simon called the alliance between CalPA and the Sierra Club "irresponsible" which "violates the very notion of the utility regulatory framework” in a letter sent to the California Public Utility Commission on December 3rd.

“The Sierra Club does not bear the CPUC’s burden of safe and cost-efficient energy on demand, better known as default obligation of delivery," Simon wrote in his letter, Forbes reports. "Yet, they partner with the independent government entity entrusted to protect ratepayers with no historical concern of energy cost.”

Simon says the Public Advocate Office signed a "common interest, joint prosecution and confidentiality agreement" in August 2019 that allows it to share information from its SoCal Gas investigation with the Sierra Club.

The fight over the natural gas ban has only heated up. In a briefing filed last week, the Public Advocate Office accused SoCalGas of several lobbying efforts that they say warrants significant fines - up to $379 million. According to the brief, SoCalGas worked to block rules that would require more efficient water heaters and furnaces and also advocated against local building codes that limited gas hookups and funded that lobbying effort with money from the company's more than 22 million customers.

“SoCalGas’ blatant violations of Commission decisions that undermine state energy, environmental, and public health policies and goals are calculated business decisions,” the briefing said. “SoCalGas is willing to make these decisions because it views the benefits of preserving its profitability as outweighing the risks of possible repercussions imposed by the Commission.”

In response, SoCalGas says shareholders are financing its political lobby, while at the same time, acknowledging it has spent some ratepayer dollars on public education (which is permitted under the agreement with the state). The Wall Street Journal points out that the distinction between public education and political advocacy "can be fuzzy."

SoCalGas has offered to allow the utility commission audit their books with the condition it would not be leaked to outside groups, however, the Public Advocate has so far refused their offer for an independent audit, because they want to share the information with environmental groups, such as the Sierra Club.

Two Democratic lawmakers, Blanca Rubio and Jim Cooper, both of whom represent low-income and minority areas, want answers as to why the Public Advocate's office has strayed away from their stated purpose "in conflict with what appears to be a new focus . . . to aid the Sierra Club in their effort to seek the ban of natural gas usage in California even though it is proven to be favored by customers as a fuel source because of the affordable cost."

The lawmakers are seeking all correspondence between the Public Advocates Office and Sierra Club as well as any other similar agreements that have been generated with other environmental groups.

According to Public Advocate program manager Mike Campbell, those types of agreements are not uncommon and often help his office better advocate for ratepayers before the Commission. Campbell also points out that the commission needs to know whether any consultants or groups are being paid by SoCalGas when they advocate against gas bans.

On Thursday, the Utility Commission is set to meet and decide whether the Public Advocate office will be allowed to subpoena SoCalGas accounting records. If they are allowed to do so it would be a violation of their charter and ratepayers would be on the hook for the Sierra Club's mission to banish fossil fuels.

Photo: Getty Images