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Reverse "rape of the ratepayer"

Consumer group retracts opinion regarding San Onofre shutdown

Michael Picker and Michael Peevey
Michael Picker and Michael Peevey

In a strongly worded statement, San Francisco–based consumer group TURN (The Utility Reform Network) asked the California Public Utilities Commission to set aside its decision to stick ratepayers with an almost $3.3 billion bill for the shutting down of the San Onofre nuclear power plant.

TURN had been one of four entities that had originally proposed the settlement, which the Reader has named the "rape of the ratepayer." The other three were the utility commission's Office of Ratepayer Advocates, and utilities San Diego Gas & Electric and Southern California Edison.

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In demanding a reopening of the decision, TURN joined the Alliance for Nuclear Responsibility. San Diego attorneys Mike Aguirre and Maria Severson have battled the commission's decision, pointing out that ratepayers would get stuck with the bill without getting any power in return, and that the failure of the nuclear plant resulted from management blunders, for which shareholders should take the hit.

In the filing, the Alliance for Nuclear Responsibility says the "failure of [Edison] to disclose its extensive communications with former president [Michael] Peevey represents fraud by concealment" that influenced TURN to go along with the settlement that "unfairly disadvantaged TURN and the Office of Ratepayer Advocates in the settlement negotiations."

As previously reported by the Reader, Union-Tribune, and other media, Peevey, a former president of Edison, drew up an outline for a possible settlement at a secret meeting with an Edison official in Warsaw, Poland. There were also numerous sub rosa meetings between Peevey and other commission officials and Edison.

"TURN agrees that recent disclosures detailing extensive communications between [Edison] and CPUC decisionmakers during the pendency of this proceeding are very troubling," says the filing, taking note that Peevey is under federal and state criminal investigation for his role in clandestine meetings that basically gave such a generous settlement to the utilities and fleeced consumers.

"TURN said reopening the case could go a long way toward restoring the commission's credibility, which sank to an all-time low under Peevey," said TURN in a news release.

Matt Freedman, attorney for TURN, said, "Ongoing federal and state investigations that caused the disclosure of the Warsaw note may lead to criminal indictments."

TURN executive director Mark Toney said, "The reign of terror at the CPUC is over."

However, many who watch commission activities are not convinced that it is on the road to reform. Peevey's replacement, Michael Picker, seems cut from the same cloth, and the commission has not yet disciplined staff members who participated in the back-channel activities favoring utility profits over consumer fairness.

Stock of Edison International, parent of Southern California Edison, dropped 2.71 percent today (June 24) and Sempra Energy, parent of San Diego Gas & Electric, declined 1.51 percent. However, the overall market was down sharply.

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Michael Picker and Michael Peevey
Michael Picker and Michael Peevey

In a strongly worded statement, San Francisco–based consumer group TURN (The Utility Reform Network) asked the California Public Utilities Commission to set aside its decision to stick ratepayers with an almost $3.3 billion bill for the shutting down of the San Onofre nuclear power plant.

TURN had been one of four entities that had originally proposed the settlement, which the Reader has named the "rape of the ratepayer." The other three were the utility commission's Office of Ratepayer Advocates, and utilities San Diego Gas & Electric and Southern California Edison.

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In demanding a reopening of the decision, TURN joined the Alliance for Nuclear Responsibility. San Diego attorneys Mike Aguirre and Maria Severson have battled the commission's decision, pointing out that ratepayers would get stuck with the bill without getting any power in return, and that the failure of the nuclear plant resulted from management blunders, for which shareholders should take the hit.

In the filing, the Alliance for Nuclear Responsibility says the "failure of [Edison] to disclose its extensive communications with former president [Michael] Peevey represents fraud by concealment" that influenced TURN to go along with the settlement that "unfairly disadvantaged TURN and the Office of Ratepayer Advocates in the settlement negotiations."

As previously reported by the Reader, Union-Tribune, and other media, Peevey, a former president of Edison, drew up an outline for a possible settlement at a secret meeting with an Edison official in Warsaw, Poland. There were also numerous sub rosa meetings between Peevey and other commission officials and Edison.

"TURN agrees that recent disclosures detailing extensive communications between [Edison] and CPUC decisionmakers during the pendency of this proceeding are very troubling," says the filing, taking note that Peevey is under federal and state criminal investigation for his role in clandestine meetings that basically gave such a generous settlement to the utilities and fleeced consumers.

"TURN said reopening the case could go a long way toward restoring the commission's credibility, which sank to an all-time low under Peevey," said TURN in a news release.

Matt Freedman, attorney for TURN, said, "Ongoing federal and state investigations that caused the disclosure of the Warsaw note may lead to criminal indictments."

TURN executive director Mark Toney said, "The reign of terror at the CPUC is over."

However, many who watch commission activities are not convinced that it is on the road to reform. Peevey's replacement, Michael Picker, seems cut from the same cloth, and the commission has not yet disciplined staff members who participated in the back-channel activities favoring utility profits over consumer fairness.

Stock of Edison International, parent of Southern California Edison, dropped 2.71 percent today (June 24) and Sempra Energy, parent of San Diego Gas & Electric, declined 1.51 percent. However, the overall market was down sharply.

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