Panel advises California energy reorganization plan be rejected
Washington (Platts)--24Jun2005
A citizens' panel responsible for reviewing all plans to reorganize California state government Thursday recommended that the Legislature reject Gov Arnold Schwarzenegger's proposal to create a Dept of Energy, determining that parts of the strategy "are legally flawed." While the state's Little Hoover Commission applauded the governor's plan to create an energy department, saying the "need for leadership on energy is essential and cannot be ignored," it cited legal rulings by the state's legislative counsel and attorney general that found provisions of the proposal that would transfer regulatory responsibility over the permitting of electricity transmission lines and natural gas facilities from the Public Utilities Commission to the California Energy Commission "cannot be done through the reorganization process." The commission said that under state law a reorganization plan cannot be amended and automatically goes into effect unless the Legislature rejects it. Because the commission believes that the governor's plan as proposed would be open to legal challenges if it became effective, it recommended that the Legislature reject the proposal. The commission encouraged Schwarzenegger to submit a revised plan that addresses the AG and legislative counsel's legal concerns. The commission told the governor that "substantial progress has been made since the electricity crisis, but analysts agree that more needs to be done to increase supplies and manage demands. A compelling case can be made that diffused regulatory authority contributed to the state's clumsy response to the electricity crisis, and that a more centralized structure is needed to forge and execute a cohesive strategy for ensuring an adequate supply of energy." But in addition to concerns over the legality of transferring some PUC duties to the CEC, the commission also said the governor's proposal "needs additional planning and analysis to ensure that proposed changes will actually improve decision-making." The PUC and CEC, the commission said, "have different competencies, decision-making procedures, and standards for judicial review. Given the importance of these proceedings, the administration should carefully review the regulatory procedures and present to the Legislature a comprehensive proposal for streamlining, integrating and if necessary consolidating authorities." In addition, the commission expressed concern over the language in the plan that would make the secretary of energy chairman of the CEC, saying that the proposal "would have given extraordinary authority to the secretary--an at-will appointee of the governor--particularly over the staff that would support the [CEC]. Modification of this scheme, including provisions for an independent chairperson, could provide the desired integration without jeopardizing the fact-based analysis and independent decision-making that is necessary to preserve the integrity of often controversial proceedings."
Copyright © 2005 - Platts
Please visit: www.platts.com
Their coverage of energy matters is extensive!!.