PG's propaganda war, part two

PG&E's propaganda war, part two | SFBG News | May 9, 2001
 		 		 		 		
The latest in an occasional series unmasking lies brought to you 
by the private utility's P.R. campaign
 						
By Rachel Brahinsky
 						
In the wake of private energy's gouging of the state's 
ratepayers, support for public control of utilities is growing 
fast. Not surprisingly, the private-utility propaganda machine is 
in high gear. Southern California Edison just kicked off a slick 
statewide television campaign to support a state bailout of the 
utility. Locally, the Coalition for Affordable Public Services 
(CAPS), which is essentially an arm of Pacific Gas and Electric 
(the group's only donor), has quietly launched a $4,300 mail 
campaign to marshall opposition to the San Francisco-Brisbane 
municipal utility district measure slated for the November 
ballot.
 						
Other communities too are considering public power. At an April 
24 conference in Sacramento on how to form new public power 
districts, more than 105 cities were represented.
 						
One guarantee is that every public power effort will face 
well-funded opposition from local utilities, including PG, which 
is now going through bankruptcy proceedings. In January the Bay 
Guardian published the first in an occasional series revealing 
the truth behind PG's glossy campaign.
 						
Here are just three of the latest lies presented in a CAPS 
mailing:
 						
Lie number one "A new government agency in San Francisco and 
Brisbane will not provide more electric power or less expensive 
power."
 						
For about 100 years public and private power companies have 
competed for the electricity business. And repeatedly it has been 
proved: public power costs less. On average publicly managed 
power districts charge 30 percent less than investor-owned 
utilities such as PG, according to the Washington, D.C.-based 
American Public Power Association. Virtually every publicly 
managed power district in the California charges less than PG, 
even after raising rates to cover the skyrocketing wholesale 
power costs brought on by the state's energy woes. As Jan Schori, 
general manager of the Sacramento Municipal Utility District, 
points out, publicly managed power costs less because there are 
no dividends, no stock options, and no exorbitant CEO salaries to 
pay.
 						
Lie number two "Some existing MUDs thus far have avoided the 
crisis. But others ... have experienced huge rate increases. For 
example, the newly formed Lassen MUD just instituted a 49 percent 
rate increase."
 						
Both the Sacramento and Lassen County MUDs did vote for a rate 
hike this year. But they still charge less than PG. And Lassen's 
well-publicized hike came to 41 percent, not 49 percent, 
according to Lassen MUD staff.
 						
The Sacramento MUD board voted to raise rates by 19 percent for 
one year, with a plan to reduce the hike to 16 percent and then 
13 percent within four years. Even at its worst, the utility will 
still charge about one-third less than PG.
 						
The Lassen MUD recently voted for its increase after the board of 
directors decided not to purchase long-term contracts last 
summer. In hindsight the board's move was obviously flawed. But 
even in the current crisis situation, Lassen is charging 
residential customers 11.5¢ per kilowatt hour. After its rate 
hike PG will charge about 11.7¢ per kilowatt hour. But remember, 
PG rates still benefit from a 10 percent price cut funded by 
ratepayer bonds.
 						
Lie number three "Creating a MUD in San Francisco and Brisbane 
actually may make the local situation worse. In addition to 
paying for power at high rates, customers would have the added 
burden of paying for PG's distribution system."
 						
A 2000 study by Redding-based public-power consultant Jim Simpson 
calculates that even after paying for PG's facilities, accounting 
for debt service, hiring and paying employees, and covering all 
operating costs, a San Francisco-Brisbane MUD would profit by 
more than $100 million annually. Simpson based his figures on 
rates charged by SMUD. That's $100 million or more that could 
fund city services.
 						
• • •
 						
CAPS is so far funded by PG. Documents filed with the Department 
of Elections May 3 show the group spent another $53,127 in the 
first quarter of this year – which brings the total spent to 
oppose the MUD initiative to $241,000. We called CAPS organizer 
Darren Seaton for comment for this story. He did not return the 
call.
 						
The MUD campaign has been financed almost completely by Bruce B. 
Brugmann, Bay Guardian editor and publisher, who gave $470 and 
loaned $32,000 to the campaign last year, according to campaign 
treasurer Carolyn Knee; the Bay Guardian donates ad space on a 
regular basis.
 						
P.S. The San Francisco Labor Council is expected to vote on 
endorsing the MUD proposal May 14. The council's Law and 
Legislative Committee voted unanimously May 4 to recommend the 
endorsement. A yes vote by the full council would have historical 
significance. Not only would it mark a shift in the group's 
position – in the past the council rejected candidates because of 
their support for public power – but it also could play a major 
role in the fate of the MUD proposal. 
						
See our Jan. 3 issue (www.sfbg.com/News/35/14/14pge.html 
[http://www.sfbg.com/News/35/14/14pge.html] ) for the first five 
lies of the year.
 						
E-mail Rachel Brahinsky at rachel@sfbg.com [rachel%5C2sfbg.com] .
 						
[http://www.sfbg.com/searchit.html]