Utility Backed Group, Davis Donors Begin Campaign Against Unwritten Energy Initiative

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A utility-backed business group and financial supporters of Gov. Gray Davis have begun a political campaign to turn public opinion away from a proposed electricity rate reduction initiative and toward Governor Davis, who is losing public support according to recent polls.

The radio ads, sponsored by “Energy for California,” tell listeners that Governor Davis is working with business and community leaders to create “historic” programs and that the “crisis” (which the Governor has called a “challenge”) can be solved if we “all do our part.” Representatives of the political consulting firm Goddard-Claussen told the Los Angeles Times that the ads could be the precursor to a campaign against a ballot initiative by the Foundation for Taxpayer and Consumer Rights (FTCR) and other consumer groups. Goddard-Claussen was hired by the utilities in 1998 to fight the FTCR-backed utility reform initiative, Prop. 9.

“This is a first,” said Douglas Heller, consumer advocate with The Foundation for Taxpayer and Consumer Rights (FTCR). “And it shows how terrified the utilities and ‘energy hogs’ must be of a ratepayer revolt. We haven’t even written the initiative yet, and they’re running ads against it.”

Business Group Support Davis Hikes on’. Business

FTCR said that with two recent polls — one by Assembly Democrats, the other by a labor union — showing a dramatic decline in public support for Davis’s reelection, it was natural for supporters to rise to defend Davis. But with most of this week’s 40% rate increase by the Davis administration slated to hit big business, their support for the Governor was remarkable.

“In the wake of the largest single electricity rate hike on California businesses, business groups should be up in arms about Governor Davis’s energy policy. Unlike residential consumers, businesses receive absolutely no protection from the current round of rate hikes; businesses should be running ads against Davis’s policy,” said Heller.

One member of “Energy for California” is William Hauck, the President of the California Business Roundtable. According to the Roundtable website, its members include Edison International, PG&E. and Sempra. FTCR will write to the members of the Business Roundtable and urge them to renounce their membership in this organization, which appears to be protecting their utility members and Governor Davis in direct conflict with the interests of the rest of California’s business community.

“It is reprehensible that a business group would defer entirely to the utilities and support ads that serve to politically benefit the Governor while ignoring the massive rate increases he is forcing on its business members,” said Heller.


FTCR also noted concern that one of the ad’s supporters, according to the Los Angeles Times, is Silicon Manufacturing Group director Carl Guardino, who is also a Davis appointee to the Independent System Operator. FTCR points out that a Davis appointee should not be funding political ads in support of the Governor’s energy committee while sitting as a member of state energy board. Mr. Guardino should be removed from his post as a result of this conflict of interest, according to FTCR.

Group Laments Lack of Action on Crisis

Calling the state’s efforts to address the deregulation disaster so far a “chaotic, haphazard and ineffectual mess,” FTCR said it was becoming increasingly likely that FTCR will draft and qualify an initiative for the 2002 ballot. It would mandate refunds and lower prices for electricity and seek to restore a reliable, affordable energy system based on non-profit public power and emphasizing new energy technologies pioneered by California companies. FTCR will continue to work with legislators in an effort to develop a consumer-oriented, legislative solution to the deregulation debacle.


Members of the California Business Roundtable include:

Aetna U.S. Healthcare of CA, Inc.


Autodesk, Inc.

Automobile Club of Southern California

Avery Dennison Corp.

Bain & Company

Bank of America Corporation

Bechtel Group, Inc.

Blue Shield of California


BP Amoco

C.J. Segerstrom & Sons

Catellus Development Corporation

Charles Schwab Corporation

Chevron Corporation

CNF Transportation Inc.

DHL Airways, Inc.

Edison International


Farmers Group, Inc.

Fidelity National Financial, Inc.

Fireman’s Fund Insurance Co.

Fluor Corporation

The Gap, Inc.

Granite Construction, Inc.

GTE Network Services

Health Net


Hilton Hotels Corporation

Hughes Electronics Corporation

The Irvine Company

J.G. Boswell Company

Jacobs Engineering Group, Inc.

Kaiser Foundation Health Plan, Inc.

Kaufman and Broad Home Corp.

Levi Strauss & Company

Lockheed Martin Corporation

McClatchy Newspapers, Inc.

McKinsey & CO.

The Newhall Land and Farming Company

Pacific Life Insurance Co.

Pacific Telesis

PG&E Corporation

Safeway Inc.

Sempra Energy

State Farm Insurance Companies

SunAmerica Inc.

Sutter Health

Target Corporation

Times Mirror

Transamerica Corporation

Unified Western Grocers, Inc.

Union Bank of California

United HealthCare

Vodafone Airtouch

Washington Mutual

Wellpoint Health Network

Wells Fargo Bank

Consumer Watchdog
Consumer Watchdog
Providing an effective voice for American consumers in an era when special interests dominate public discourse, government and politics. Non-partisan.

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