Santa Monica Group Urges PUC to Reject DWR Rate Agreement Proposal

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City News Service

A Santa Monica group appealed again today for the state utilities commission to reject its president’s proposal to leave electric rate-setting up to the Department of Water Resources.

The state is trying to float a $13.4 billion municipal bond issue to pay back the general fund for electricity it bought earlier, and wants to assure potential buyers of the bonds there will be a secure revenue stream to retire them.

To do that, California Public Utilities Commission President Loretta Lynch has proposed giving the DWR — run by the governor’s energy czar, former Los Angeles Department of Water and Power chief S. David Freeman — discretionary power to raise electric rates.

“The plan would allow a state agency to operate behind closed doors,” said Doug Heller of the Foundation for Taxpayer and Consumer Rights, “while it negotiates with ratepayers’ money.”

His organization believes the Lynch plan goes too far and would allow the DWR to “pass on to ratepayers an expansive lists of costs incurred by the agency, including consultant costs, legal expenses and the payment of power companies’ pollution penalties.”

Heller said secrecy “in DWR leads to conflicts of interest and that leads to higher rates. The public depends upon openness and transparency in state government, and this proposal denies both.”

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