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Climate Change

As California Burns, Clean Energy Advocates Urge An End To Investor-Owned Utilities

Calls for the end of investor-owned utilities are increasing across America as people realize their social cost is just too high.

California is experiencing some of the worst forest fires in its history. 80 mph winds are expected to whip existing fires into a paroxysm of ferocity. In response, Pacific Gas & Electric, an investor-owned utility that services much of northern California, is proposing to shut off electricity to a million or more customers.

If you scroll down through the comments to McKibben’s tweet, you will see a compendium of people raging about how PG&E executives have stuffed their pockets full of cash and other benefits while the company’s grid maintenance efforts went unfunded. Many go so far as to suggest that the blackouts — which never happened on this scale before this year — are retribution for forcing the company to declare bankruptcy last year.

The travails of PG&E are monumental, but dissatisfaction with investor-owned utility companies is growing all across America. Dave Roberts, known to his many followers as Dr. Vox, put a spotlight this week on a story in Teen Vogue that deals specifically with this issue. Teen Vogue may not be where you get your news from, but Roberts says that under the guidance of editor Elaine Welteroth, it offers some of the best reporting on climate issues available anywhere.

A New Idea With Old Roots

Public ownership of utility companies is an idea that stretches back to the beginning of the utility industry. Today, there are more than 2,000 public utilities in America. The Rural Electrification Act of 1936 came into existence to provide publicly-owned electricity to farmers that for-profit utility companies refused to serve.

Nebraska’s electricity has been supplied exclusively by publicly-owned utilities and energy cooperatives since 1946. Utility rates in Nebraska are some of the lowest in America. Burlington, Bernie Sanders’ hometown in Vermont, has had a municipally-owned utility company since 1905. In 2014, it was the first city in America to commit to 100% renewable energy.

Investor-owned utility companies spend a lot of the money they take in from rate payers to lobby regulators and politicians for sweetheart deals that will fatten their profits. A consortium of utility companies recently spent millions of dollars in a campaign to convince Florida voters to approve a constitutional amendment that would prohibit homeowners and small businesses from installing solar systems on their roofs.

David Pomerantz of the Energy and Policy Institute points out that public utilities are not always friends of the environment. Most of them belong to trade associations like the American Public Power Association and the National Rural Electric Cooperative, both of which have fought EPA clean air, water, and carbon pollution regulations.

Pissed Off In The Big Apple

People in and around New York City are advocating for the idea of turning both Consolidated Edison and National Grid into public utilities. National Grid is pushing a plan to build a pipeline under the waters of New York harbor, a plan that is vigorously opposed by environmental activists in New York and New Jersey.

“Both ConEd and National Grid are proposing to raise our rates to expand fossil fuel infrastructure,” says Lee Ziesche, an activist with the Sane Energy Project. “What they are proposing completely fails the climate test.” The New York City Democratic Socialists of America has launched its Public Power plan, a campaign that advocates for making the energy grid publicly owned. Giving the public control over New York City’s energy future they argue could lay the groundwork for the just, rapid decarbonization of the energy sector.

“We could decommodify clean energy and guarantee it to all New Yorkers as a human right, much in the same way we already guaranteed clean water through our public water utility,” said Amber Ruther, an organizer with NYC-DSA, during a recent hearing before the New York State legislature. She says investor-owned utilities are not in a position to tackle the climate crisis. “The incentive structure for private utilities was designed to encourage them to build as much infrastructure as possible. But now that incentive structure is obsolete and it’s preventing us from achieving our climate goals.”

New York Mayor Bill de Blasio suggested socializing the city’s utilities recently. In late July, councilman Costa Constantinides partnered with NYC-DSA to host a town hall meeting to address ConEd’s proposed rate hikes. Over 100 people traveled in the pouring rain to attend the town hall to voice their opposition to those rate increases and to support public utilities. But no one from ConEd or the New York Public Service Commission bothered to attend. Such arrogance is emblematic of attitudes in the utility industry.

The Empire Strikes Back

In response to the article in Teen Vogue, Michael Clendenin, ConEd’s director of media relations, sent the following e-mail. “We can maintain high reliability and have a clean energy future. Con Edison is committed to helping New York State achieve its clean energy goals, and through our Clean Energy businesses we are the 2nd largest solar producer in North America.” A spokesperson for National Grid provided links to the company’s plan for “investing in the natural gas networks making them safer and more reliable, advancing a cleaner energy future.”

To which Teen Vogue had this response — “The idea that more gas networks will advance clean energy has no basis in climate science.”

Energy Democracy

Today’s emerging campaigns are calling for a new system of “energy democracy” to address the overarching goal of climate justice. What this entails takes many forms. The #NationalizeGrid campaign and the George Wily Center have combined forces to advocate for public power in Rhode Island.

“It’s a pretty simple piece of legislation [requiring] a very minor tax increase across the state, [that would mean] low income payers would only need to pay a certain percentage of their monthly income as their utilities payment,” says Corey Krajewski, an activist with the campaign.

Boston’s Take Back the Grid campaign has been focused on ensuring workers and communities of color in Boston benefit from the shift to a publicly-owned renewable grid. Similarly, Northern California’s Let’s Own PG&E campaign has been thinking through ways to ensure that the PG&E workers are included in the new energy system. A proposed ballot measure would protect the workers’ pensions.

In Maine, Representative Seth Berry has introduced legislation that would combine both of the state’s primary energy suppliers into one publicly-owned utility. He says it’s a major opportunity to address the climate crisis. “Basically, we have to electrify our entire economy, and we have to do that really fast. It’s like the foundation that we’re building our home on for the future,” Berry says.

Of all the Democratic candidates for president, Bernie Sanders has advanced the most aggressive plan for public control of utility companies, according to Green Tech Media. Perhaps the people in California would not be experiencing the forest fire nightmare that grips their state today if public utilities were the norm there like they are in Nebraska. The social cost of investor-owned utilities may simply be too high for US communities.

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Written By

Steve writes about the interface between technology and sustainability from his home in Florida or anywhere else The Force may lead him. He is proud to be "woke" and doesn't really give a damn why the glass broke. He believes passionately in what Socrates said 3000 years ago: "The secret to change is to focus all of your energy not on fighting the old but on building the new."


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