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|February 17, 2020|
California regulators cut antiterror spending for power plants
A new state law mandating that utilities take steps to protect power plants from terrorist attacks is being held hostage in a fight between the California Public Utilities Commission and legislators over the agency’s $5 million legal tab in corruption investigations.
The Legislature slashed $5 million from the utilities commission’s budget this year, angry that regulators had hired outside lawyers as federal and state investigators probed allegations of official influence-peddling and improper deal-making with Pacific Gas and Electric Co. and other utilities.
Lawmakers didn’t specify where the commission had to make budget cuts, however — and last week, the agency took the money in part from efforts to implement antiterrorist legislation.
South Bay incident
The legislation, proposed by state Sen. Jerry Hill, D-San Mateo, and signed by Gov. Jerry Brown in 2014, ordered the state’s power providers to draw up security plans to harden the electrical grid against saboteurs. The law was prompted largely by an April 2013 incident in which gunfire knocked out 17 transformers and inflicted $15.4 million in damage to PG&E’s Metcalf substation near San Jose.
Although the FBI said the attack was not the work of terrorists, it raised concern among some experts that it exposed vulnerabilities in the power grid.
There was a second security breach at Metcalf in August 2014, just days before the Legislature approved the law that took effect this year. In that attack, burglars cut through a fence and stole construction equipment. PG&E officials did not notice the breach for hours, prompting the utilities commission to fine the company $50,000 for failing to carry out promised security upgrades.
Last week, commission Executive Director Timothy Sullivan told the agency’s five-member governing panel that he would slash $350,000 needed to implement the security plan as part of the $5 million in cuts that the Legislature ordered.
The money would pay for staffers to oversee the program. Without them, there will be no one at the commission to evaluate the utilities’ security plans.
The cuts took effect without a vote of the commissioners, all of whom were appointed by Brown.
“Physical security for critical facilities is already being addressed by the Federal Energy Regulatory Commission and the North American Electric Reliability Corp.,” an industry trade organization, Sullivan wrote in a memo to the commission. “CPUC is also looking to establish better collaboration” with the state Office of Emergency Services, “which could be a better agency to address security concerns.”
In an interview, Sullivan said the involvement of the federal and state agencies means the commission cutback “doesn’t really compromise safety the way that cuts in other programs would.”
Hill said that with increased worldwide concerns about terrorism, the utilities commission’s move was “unbelievable.”
“They are trying to make it painful for the Legislature, the same Legislature that is trying to hold them accountable for power plant security and grid safety,” Hill said Monday. “Where we made the mistake was, we did not specify where the $5 million in cuts needed to take place.”
The $5 million expenditure that angered lawmakers went to an outside legal firm to represent agency staffers caught up in state and federal investigations that began last year. Those probes are looking into whether PG&E and other utilities cut secret deals with current and former officials and helped political projects dear to agency leaders. No one has been charged.
The utilities commission explained that it had to outsource the legal work because the attorney general’s office, which is leading one of the corruption probes, cited a conflict of interest and refused to represent the regulatory agency.
In addition to slashing the utilities commission’s budget, state lawmakers passed several measures aimed at reforming the agency, all of which Brown vetoed. Among the bills was one by Hill that would have required the commission to get the Legislature’s approval to hire outside legal help.
“We want to make it clear to them that if they are going to spend it on lawyers, they are going to pay a price for it,” Hill said. “They chose to reduce it the way they did.”
Sullivan also targeted other high-profile projects in making the $5 million in cuts. Among them was slashing $1 million from the $1.9 million set aside to improve the agency’s computer databases.
That could delay changes intended to help the utilities commission track leaks in natural gas transmission pipelines, a project that started after a PG&E explosion in San Bruno killed eight people in 2010.
In an ironic twist, Sullivan also suspended oversight of a greenhouse-gas research project that the agency approved last year for University of California campuses, stemming from the closure of the San Onofre nuclear power plant in San Diego County.
That funding was a provision of a secret 2013 deal between then-commission President Michael Peevey and an executive of Southern California Edison, the utility that co-owns the plant. The deal, as well as other back-channel communications between regulators and utilities, later became the focus of the state’s corruption probe.
Sullivan said the agency did the best it could in making the cuts.
“I try to take a meta-view about it,” he said. “The Legislature was sending us a message that they wanted us to pay more attention to their oversight. They didn’t have confidence in what we were doing, they are the ones who cut the budget. Democracy is pretty messy.” (Source: The San Francisco Chronicle)
Story Date: November 25, 2015