PURPA under attack by utilities and their front groups

Electric utilities are backing a proposal to gut the Public Utilities Regulatory Policies Act (PURPA), a federal law that supports the growth of renewable energy and competition in electricity markets, and they brought their network of special interest groups and paid consultants to the fight. 

A Notice of Proposed Rulemaking (NOPR) backed by President Trump’s Republican appointees to the Federal Energy Regulatory Commission would gut PURPA’s support for renewables. Attorneys general for eight states warned that the move could jeopardize states’ ability to meet their clean energy and climate goals. 

The move was immediately praised by the Edison Electric Institute (EEI), which has targeted PURPA for over 40 years, in a joint statement with the American Public Power Association and National Rural Electric Cooperatives Association. EEI also submitted comments to FERC in support of the NOPR, comments that were echoed by EEI member utilities like Southern Company, which said that it “actively participated in the development of the EEI comments” in its own filing on the issue. 

Other utilities also endorsed EEI’s comments, including: 

• Alliant Energy
• Arizona Public Service Company
• Duke Energy
• FirstEnergy
• NextEra Energy  
• Pacific Gas and Electric Company
• San Diego Gas & Electric Company
• Southern California Edison Company 
• Xcel

A subsidiary of one major utility, Consolidated Edison Development, weighed in that it “strenuously” opposes the NOPR. Con Edison Development develops renewable energy projects, often selling the electricity at rates governed by PURPA. 

“CED strenuously objects to the Commission’s proposed rule changes, not the least of which because of several aspects of the Commission’s NOPR are unlawful and discriminatory in violation of the Public Utility Regulatory Policies Act of 1978,” Consolidated Edison Development said in its comments to FERC.  

“There is little evidence that the current regulations produce a bad result, and there is every reason to think that the current regulations have produced new technology, created competition with incumbent monopoly utilities, and have provided renewable energy to customers at a rate that holds them indifferent,” it also said.

Beyond that defection, utilities largely lined up behind EEI’s campaign to gut PURPA, consistent with the utility industry’s long history of lobbying against policies that promote clean energy and challenge their monopolies.

Below is an overview of some of the consultants and front groups utilities that are part of the utility industry’s campaign against PURPA.  

We Stand for Energy

A petition with only 300 signatures was submitted to FERC by We Stand for Energy, a national astroturf group correctly identified in FERC’s PURPA NOPR docket as a “Project of the Edison Electric Institute.” 

EEI paid for We Stand for Energy’s Facebook ads to promote the petition and a related video. We Stand for Energy NC also paid for a Twitter ad attacking PURPA. EEI member Duke Energy has also attacked PURPA in Florida and North Carolina. 

We Stand for Energy argues that PURPA needs to be “modernized” by FERC because “… wind and solar energy have grown to be important parts of our energy mix, and parts of PURPA no longer make sense.” 

While wind and solar have grown since PURPA was first enacted in 1978, combined they still produce only around 7% of the electricity generated in the U.S. EEI’s internal documents have shown that utilities feel threatened by the strong support for shifting to 100% renewable energy among their customers. 

We Stand for Energy supports major gas projects like the Atlantic Coast Pipeline that will lock in utilities’ dependence on fossil fuels that contribute to climate change for years to come.

Concentric Energy Advisors

EEI attached a study claiming that utility customers have overpaid for renewable energy contracts under PURPA in its comments to FERC on the NOPR. The study by Concentric Energy Advisors, whose client list is dominated by utilities, was commissioned by EEI and released with some fanfare last month. 

John Weaver of PV Magazine wrote that the EEI-backed study suffers from a “major sampling error” that likely accounts for the “overpayment” for solar contracts that Concentric Energy Advisors attributes to PURPA. 

Institute for Energy Research

Travis Fisher, a FERC staffer who worked for the Institute for Energy Research before he joined the Trump administration, participated in a session on “PURPA Reform” at an EEI External Affairs Conference last year. 

IER contributed another anti-PURPA study to the NOPR docket. IER has received funding from EEI, as well as from coal producers like Cloud Peak Energy and Peabody Energy, and Koch foundations.

IER attached to its NOPR comments a study on “The Urgency of PURPA Reform to Assure Ratepayer Protection” by David Dismukes of the Center for Energy Studies at Louisiana State University. 

“The author wishes to thank the Institute for Energy Research for financial assistance in conducting this research,” the study said. 

The Center for Energy Studies has an Advisory Council that includes representatives of major utilities like AEP, oil and gas companies like ExxonMobil, and Koch Industries. 

Dismukes, who previously authored a misleading report attacking net metering rooftop solar in Louisiana, also runs a consulting firm called Acadian Consulting whose clients include electric and gas utilities. 

IER recently teamed up with the coal industry on another misleading report attacking wind and solar power. 

Consumer Energy Alliance 

Another comment in support of the NOPR came from David Holt, president of the Consumer Energy Alliance (CEA) and managing partner for the lobbying firm HBW Resources that runs CEA. 

“On behalf of our 550,000 individual members and nearly 300 member organizations, Consumer Energy Alliance (CEA) writes to express appreciation and support for the Commission’s determination to modernize its Public Utility Regulatory Policies Act (PURPA) regulations in a way that benefits the American energy consumer and family budgets,” Holt wrote.

Those member organizations include many fossil fuel and utility interests, including EEI.

Americans for Tax Reform

Americans for Tax Reform, which has received $183,500 from EEI since 2013, referenced the EEI-backed study written by Concentric Energy Advisors in its comments to FERC on the NOPR. 

Americans for Tax Reform claims that “PURPA creates unnecessary and burdensome costs on ratepayers and energy consumers.” Yet it receives funding from EEI, which many utility customers are forced to fund through hidden charges on their electricity bill. 

Based on this funding model, EEI’s president Thomas Kuhn raked in nearly $5.5 million in total compensation in 2018. EEI’s revenue totaled $90 million that year. 

Some states are stepping up their oversight of utilities’ recovery of EEI dues from customers. Earlier this year, the California Public Utility Commission barred Southern California Edison from recovering any of its EEI dues from customers. 

The U.S. Chamber of Commerce

The U.S. Chamber, which has received $233,050 from EEI since 2012, also submitted comments supportive of the NOPR. 

As with EEI, utilities like NextEra-subsidiary Florida Power & Light have sought to recover their U.S. Chamber dues from customers. 

A former member of the Michigan Public Service Commission

Another commenter supportive of the NOPR was Steven A. Transeth, a former member of the Michigan Public Service Commission (2007-2009). Transeth’s comments cited Concentric Energy Advisors’ study for EEI. 

Transeth also attacked PURPA earlier this year. The Detroit News published his op-ed in April, which was when the PSC was set to rule on Consumer Energy’s request to waive certain requirements under PURPA. The PSC denied the utility’s request, and then months later approved a settlement between solar developers and Consumers Energy that will place 584 MW of renewable energy projects under contract by September 1, 2023.

Transeth now has own consulting firm, Transeth & Associates, and he’s also the executive director of the Michigan Energy & Jobs Coalition, which counts DTE and Consumers Energy among its key members. In 2012, Transeth worked with the DTE- and Consumers-backed Coalition for Affordable Renewable Energy to defeat a Michigan ballot initiative requiring the utilities to get 25 percent of their power by 2025. In 2011, he represented the Coalition for Fair Transmission Policy, which also included DTE and Consumers Energy as members, in criticizing FERC Order 1000.

The PURPA NOPR “…track with what both DTE and Consumers would want to see happen,” Transeth recently told the Energy News Network.

Transeth also recently authored an opinion piece in UtilityDive defending DTE’s long-term resource plan from criticism. 

… and Koch-backed groups

A number of special interest groups that have received funding from foundations linked to Koch Industries also weighed in with comments in support of the NOPR, including Americans for Limited Government, Center for Freedom & Prosperity, Center for Growth and Opportunity, Competitive Enterprise Institute, National Tax Limitation Foundation, and National Taxpayers Union. 

EEI is closely connected to the Koch network through its funding of groups like Americans for Prosperity, the American Legislative Exchange Council, and the State Policy Network, where EEI has campaigned against net metering for rooftop solar. 

Top photo from Flickr by Kristian Buus. Creative Commons License info