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This page contains a single entry from the blog posted on October 14, 2003 2:17 AM. The previous post in this blog was Room for improvement. The next post in this blog is Flowage needed. Many more can be found on the main index page or by looking through the archives.

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Tuesday, October 14, 2003

Dime a dozen


The ballots for the special election on the proposed public utility district (PUD) here in Multnomah County go out in the mail next week. They're due back on November 4. Today's the deadline to register to vote in this interesting election. Information on how to do that can be found here.

By now voters have heard a lot about the stakes in this one: Should the electric power business in Portland be taken away from the private utilities that currently run it -- Portland General Electric and Pacific Power -- and turned over to a new public entity? The new entity, a PUD, wouldn't have private shareholders; it would be an autonomous government agency that buys and sells power all of the public in its service area.

Proponents of the PUD say it will take the energy business out of the hands of greedy corporate pigs like Enron (the parent company of PGE) and put it into the hands of the people, where it belongs. They point out that PUDs operate successfully in many other places in the West, including Los Angeles and much of the State of Washington.

Opponents of the PUD charge that it will create a new layer of government bureaucracy, increase local taxes, and subject electric ratepayers to large increases in their power costs. They also point out that the people who would be running the PUD would be rookies who won't have a clue how to insure the PUD's survival in the cut-throat, deregulated, freewheeling jungle of energy trading.

As I've mentioned here before, I'm inclined to vote no on the PUD. Although Enron is evil, PGE isn't necessarily, and I don't get my power from PGE anyway. The monopoly in my part of town is operated by Pacific Power, and they do a great job. Their new owners in Scotland haven't, to my knowledge, engaged in any of the hanky-panky that got Enron and its various constituencies in so much trouble. So I'm not interested in losing them as my power company. Plus, given the disaster that the City of Portland has made out of the water business, I'll take a regulated utility over a local government for my basic services any day.

A look at the Voter's Pamphlet for the upcoming election solidifies my position. Even if I were to buy into the public power concept, I'm looking at the 12 people who are running for the five-member PUD board of directors that would run electricity in Portland if the PUD passes. And I can't believe that any combination of five of them would have the faintest idea of what the heck they are doing.

We have (1) a PGE lineman; (2) a "self-employed" candidate (no occupation revealed); (3) a congressional staffer; (4) the editor of the local left-wing newspaper; (5) a dyed-in-the-wool political hack who seems to run for every available office; (6) an environmental "consultant"; (7) the chief of a peacenik nonprofit group; (8) a "math tutor"; (9) the administrator of a soil and water conservation district; (10) a retired school teacher; (11) a "land management consultant"; and (12) an unemployed engineer. Ten of them are pictured above; two didn't bother to send in a picture in time for publication in the pamphlet.

See anybody there who's qualified to run an electric company? I don't.

And then there are the ideas they're floating. One guy wants to set customers' rates "based on ability to pay." Another stuns us with the revelation that "[a]s a member of the PUD Board, it will be my duty to see that the PUD delivers a continuous flow of electricity to the customers / rate / tax payers of the PUD." One says he understands "the botton line," although he apparently can't run a spell-checker. Still another notes that he kept tuition down when he was on the community college board. And another lets us know that he's hosted an environmental radio show on KBOO radio for 13 years, and that this demonstrates his "strength in environmental issues."

Several of the candidates say they will stop the PUD from taking over Pacific Power; they'll limit the takeover to PGE. The rest are noncommittal on the subject.

The one glimmer of common sense in the campaign statements comes from candidate Tom Markgraf, an aide to Rep. Earl (the Pearl) Blumenauer, who points out: "This isn't like buying a coffee cart. You need highly experienced people to manage an electric utility."

And alas, this slate doesn't even come close to filling that bill.

Of course, if the PUD is defeated at the polls, the twisted logicians at Portland City Hall will redouble their own efforts (around $1 million spent so far, and counting) to have the city buy PGE. And don't worry, everybody, Erik Sten's in charge of that one.

Comments (10)

I ran your comments through the Gematriculator and they came out 82% good / 18% evil, so I am voting against the PUD.

I ran Josh's comment through the Gematriculator and it came back 75 percent good and 25 percent evil. So we are losing ground.

But Prof., Oregon's way is so democratic. Some places that I won't name have barriers to the ballot. Here anyone can run for a local, state, or federal office. I like Oregon for that.

Still, your post reminded me of my first look at a Voter's Pamphlet. The candidates' candid and even odd responses to the Pamphlet's questions escape me, but for the "adequately educated" man's.

So, there is a dearth of public utility experience in the proposed slate of PUD candidates. Did you really expect any PGE or Pacific Power executives to run for something that would spell the end of PGE?

Moreover, how much money is PGE/Pacific Power spending in opposition to these measures? More succinctly, what percentage of our electric bills are subsidizing their campaign?

I'm not thrilled with the PUD candidates, nor am I enthusiastic about Erik Sten being anywhere near the helm of our electricity supply (note to Erik & Dan: where's the stormwater discount you promised me four years ago? I'm still waiting!). That said, everytime I see an ad on prime time TV telling me to vote against the PUD because it'll add another layer of government & increase my property taxes, I realize that *I'm* paying for that ad & it's starting to piss me off -- perhaps enough to vote for this PUD thing just to spite the executives at PGE.

I don't see it quite the same way as the skeptics I'm afraid---but then, as a person who's interested in local control and low electric rates, I admit, I'm biased. I'm also one of the lame candidates you mentioned---the unemployed engineer.

Here's how I see it:
It all comes down to whom do you trust.

Let's see what our choices are:
1) Trust PGE/Enron and the bankrupcy court to ensure PGE remains intact and in the hands of a non-greedy purchaser and at a cost which doesn't cause them to raise rates,
2) Trust the City of Portland to muster the guts to threaten PGE/Enron with eminent domain and condemnation, or
3) Trust a group of 5 unpaid, willing and concerned residents, elected by the people to plan and coordinate a county-wide People's Utility District with the goal to ensure that the Enron deck of cards doesn't continue to collapse on the backs of PGE's employees and ratepayers.

With the third choice, we take the energy bull by the horns and control our energy future. The first 2 depend 100% on the trust of career politicians or a bankrupcy court. To me, it's clear: A PUD is the right choice. The time is now. Of the 12 candidates, there are at least 9 candidates which are up to the job the way I see it.

Consider this:
* 29 public power entities in Oregon
* Over 1/4 of Oregonians own and control their own electric utility
* Over 60% of Washington State residents served by PUDs
* ALL Oregon PUDs have lower rates than PGE, some less than 30% of PGE's rates
* No PUD has ever decided to go back to a for-profit model after gaining control of a utility
* PUD directorship is not rocket science---if it were, there would have been some failed PUDs and higher rates. This hasn't happened.
* None of the current PUD candidates are interested in condemning Pacific Power's assets. It's not Pacific Power customers who should worry about the PUD, it's Pacific Power which knows that it cannot get away with any PGE/Enron games or rate increases should a PUD exist within its territory. To do so would be suicide.

Noone wants high rates. Trust the bankrupcy court with Enron and we can easily see rates quadruple as they did in Montana when they sold off their energy assets to Pennsylvania and avoided state regulatory oversight. Enron will do the same if allowed---sell to highest out-of-state bidder who would jack rates right up without OPUC oversight and control. Montanans are outraged at what became of their utility.

So the way I see it, the PUD is a no-lose proposition for us all. I trust that whoever is elected to serve (until 01/2005) will have their work cut out for them, but there are ample resources and examples to follow.

I see the PUD passing as it did the 4 cities (Scapoose, St.Helens, Columbia City and Rainier) when the people recently voted to ditch PGE and annex themselves to Columbia PUD (Clatskanie PUD for Rainier). The measures passed with a 2:1 ratio despite a 35:1 or so spending ratio by PGE. The arguments were similar (see last Sunday's article on the subject) and spending proportional.

In our case, by law we need to fund an engineering report (meas. 26-52). That measure requires a 50% voter turnout. So it's possible that the PUD could be established, yet no funding for an engineering report granted. The engineering report is essential to have an independent accounting of PGE assets and valuation which the PUD would be interested in purchasing. With the report, the threat of condemnation of PGE assets would be real enough that PGE/Enron would finally be forced to deal fairly with its purchasers, be it the PUD or the City of Portland (who also could pull the condemnation card, but hasn't the spine).
PGE would surely accept a reasonable offer for its assets than risk heading to court and face a judge or jury in a condemnation hearing.

I suggest anyone who is still skeptical about PUDs, start looking at the many web pages of the Washington and Oregon PUDs ( www.opuda.org ). The only unsuccessful PUDs have been the ones which never got off the ground due to having failed to get revenue-based financing approved prior to some utility-foisted shill being elected or appointed to the board and consequent dissolving of the board itself---this happened to a PUD in Washington state.

There is plenty of fat built into PGE's rates. For one thing, they collect some $100M/yr in State and Fed. taxes from us, yet never pay them to the State or Feds since Enron inhales all the money! There are also the many millions in executive salaries which would go away. When you look at all the fluff, there's little chance that our rates will do anything but go down with a PUD. Moreover, we would own the utility! Who among you would rather rent than own?

If you still haven't voted, please support both measures. And if you're undecided on the candidates and you'd like to see an Electrical Engineer onboard, cast a vote my way. Apologies for no picture in the election pamphlet---I threw my name in the campaign hat at the last minute. As candidates, all we are are your neighbors and friends doing the right thing: trying to bring local control and low rates to more Oregonians.

-Myles Twete, P.E.
Candidate for Mult. Co. PUD

See also:
www.pgeisenron.com
www.opuda.org
www.oppc.net

Myles, I appreciate your comments. You're right, it's all about trust, or lack of it. And I still don't trust five people who are basically sitting around at a neighborhood association saying, "Hey, let's start our own electric company!" to produce any real savings. There's too much downside risk there.

Too much downside risk.
Hmmm...risk, yes, even downside.
But aren't risks greater with unregulated assets in 'for-profit' out-of-state hands than in the hands of former PGE employees whose board is elected locally and whose assets are ours?
Even the Willamette Week has endorsed these measures acknowledging that monopolies deserve trust only when it is earned. Enron hasn't earned our trust. Articles in the Oregonian favor the PUD as have editorials in the past.
Our taxes will NOT go up by over 3% as the opposition claims and the unfair ballot title alludes. Rather, only a 1 time tax of .003% to pay for an engineering report. This is less money than the cost of a half cup of coffee for the average house in a full year!
Risks? Financing the purchase of PGE assets carries little risk. Revenue-backed bonds are certainly cheaper than financing available to any for-profit suitor who may end up buying PGE pieces at a a much higher price than we have.
As to slicing up at county/city/other borders, this happens often enough and has never posed a formidable problem. When the Columbia PUD established itself while St.Helens, Columbia City and St.Helens failed to pass the vote, it did cost money to isolate these PGE-served cities. But it didn't break the PUD and indeed their rates were still so low that voters from EVERY ONE of those cities voted 2:1 to annex themselves away from PGE/Enron and to the PUD.
So if we learn from history, there should be little to fear. We have David Covington, lineman for PGE running for Multnomah PUD director. He's a strong supporter of the PUD, has an understanding of these separation issues and would add substantially to bringing trust by the PGE rank and file in the PUD once formed.

I think we have a winning combination with these candidates in most rolls of the dice. The resources are vast to help make the PUD a success. The biggest hindrance is Enron and PGE upper management. Remember, while utilities rarely willingly sell assets to a PUD, once faced with condemnation via ballot measure to pass revenue-backed bonds to purchase condemned assets, utilities tend to cave and sell to avoid the condemnation.

It's easy to say there's downside risk. But the downside seems much greater when you cede control to greedy corporados who have no obligation to the people and no restraint by OPUC. We can avoid this by doing what other communities in the northwest have done---establish a People's Utility District.

Power to the People!

Jack-
So you'd rather trust Peggy Fowler, those in charge of Enron and the bankrupcy court to keep your rates low? Don't forget the energy trading scams like "death star" and "boomerang", the dashing of PGE employee retirement funds, California energy crisis and huge increases in our rates in the wake of all this.

It is ALL about ENRON.

As BBC journalist Greg Palast put it in a radio interview (paraphrasing):
"if Multnomah County residents vote in favor of Enron controlling their electricity, they will indeed be the laughing stock of the world".

No to Enron.
Yes to local control and ownership.
Our Governor and Secretary of State ENDORSED PUDs in celebrating the 17th Annual Public Power Week two weeks ago. The main arguments we make in this election are made right there, by our Governor, that Public Power saves money, ensures reliable service and ensures our electric power system will be affordable and reliable into the future. This was a 3/4 page proclamation in the latest Oregon State Grange Bulletin. The Grange was responsible for getting PUDs legally established in the 1930s in Oregon. PGE had been bought by a holding company, which raised rates through the roof then also after it was sold to a holding company---sound familiar? It took 9 years after bankrupcy for PGE to again become a locally owned entity. It's deja-vu all over again with Enron, only we can't trust PGE will end up remaining a locally-owned entity except by public ownership.

If only the people knew...

Enron is in bankruptcy court. There is no more Enron. There will be new owners of PGE very soon. And right now we don't know who they will be.

This is really about public power vs. private power, and the PUD advocates are basically saying the same thing they've said for the last 60 years or more, that all private power is bad. That's not a totally implausible position, but I disagree.

Plus, looking at the director candidates, I'm sure that they'd wind up getting the PUD into some very, very expensive power contracts -- probably burning patchouli oil -- with no way out.

Sorry, there is very much still an Enron, even though it is in bankruptcy court. And even after it is finished being liquidated, its legacy will remain. Such as:

"[V]ery, very, expensive contracts" -- like the ones that utilities were suckered into during the artificially-created "power crisis" (100% market manipulation -- there WAS no shortage!)? Like the ones that utilities left and right are SUING to get out of, because they're not honest contracts at fair prices (seeing as how the sellers of wholesale power were illegally conspiring to manipulate the markets)?

Every utility that is, except for Enron-owned PGE, which doesn't dare go against the wish of its owner and master.

See, that's the really galling thing about all the PGE propaganda out there -- it's such a total lie that the exact
opposite is usually true.

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First off, yesterday the Willamette Week endorsed the formation of a People's Utility District here in Multnomah County: First, PGE's conduct has been a textbook case not of the failures of the free-market system, but... [Read More]


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