California lawmakers kill measure meant to keep politics out of customer utility bills
State lawmakers rejected a measure to prohibit California’s major energy utilities from recovering expenses for political activities Monday evening, after most members of the senate energy committee abstained from voting.
Under federal law, investor-owned utilities such as Pacific Gas & Electric Co. and Southern California Gas Co. are required to use money from investors to pay for things such as brand advertisements and lobbying for legislation. But consumer advocates have long asserted that utilities find loopholes around such rules through the long and complex rate recovery process at the California Public Utilities Commission, confirmed through extensive reporting by the The Sacramento Bee.
The measure was originally inspired by an investigation into SoCalGas’ use of tens of millions in customer money for its fight against clean energy policy by creating front groups and launching misleading marketing campaigns to support for consequential lawsuits.
The Bee also reported that PG&E billed ratepayers for a recent TV ad featuring PG&E CEO Patti Poppe touting the company’s work to underground power lines. The utility has argued that the ad falls into the category of safety communications.
“We’ve seen too many examples of the blatant misuse of ratepayer funds across the state from PG&E to SoCalGas, and I know that consumers are outraged by this,” said senator Dave Min, an Orange County Democrat and the author of SB 938.
“Like so many California ratepayers, I am disappointed that this common sense bill, which would have prevented investor-owned utility companies from misusing ratepayer money for their political objectives, died today in the Energy and Utilities Committee.”
After facing intense opposition from PG&E, the bill failed to pass for a second time in the Senate by a single vote.
In its opposition letter to the bill, PG&E said it would have taken away the power of state regulators to examine utility companies’ costs and decide whether it is “just or reasonable″ for customers to pay for them.
PGE did not respond immediately to a request for comment.
The battle over this measure comes amid a period of rising electricity costs in California, home to some of the most expensive energy bills in the country. PG&E raised residential electricity rates by about 20% in January, an average annual increase of about $400 per household.
The bill would have required utilities to file more information about their political influence activities and advertising with the Public Utilities Commission and require that information to be made public.
Senior attorney at Earthjustice Matt Vespa said he was deeply disappointed to see the measure, which he argues would have brought needed transparency to residential energy bills, blocked by utility lobbying.
“Every time Californians pay their skyrocketing utility bills, they are very possibly footing the bill for their utility’s advertising or political lobbying campaigns,” he said, calling on lawmakers to put stronger guardrails in place in the future.
“The Sacramento Bee has revealed that utilities like PG&E and SoCalGas are fleecing their customers one dime at a time to the tune of millions of dollars. We will continue to fight to hold utilities accountable for their misuse of customers’ money.”
PG&E said it has spent up to $6 million TV ads since 2022 to tout its plan to reduce wildfire risk by burying power lines. One ad features Poppe in a branded hard hat, saying that the company is “transforming your hometown utility from the ground up.”
The Bee reported last week that those expenses came from a customer-funded account dedicated to reducing wildfire risk. A PG&E spokesperson said that state regulators allow utilities to use customer money to pay for safety communications on television.
Ultimately, the California Public Utilities Commission will decide whether customer funds pay for the ads.
