More Elections 2010

Last week, California voters rejected Proposition 16, a statewide ballot initiative that PG&E spent $46 million to promote.

Outraged at that use of ratepayer revenues, state Sen. Mark Leno on Monday announced legislation that would prohibit PG&E from using ratepayer funds for future political campaigns.

Proposition 16 called for two-thirds majority support from voters before local governments could form or expand municipal utilities. PG&E said the goal was to give taxpayers a voice if their governments spend public dollars to get into the power business. But critics said the company was trying to sabotage communities eager to procure greater portions of their power supply from renewable energy sources such as wind and solar.

Throughout the Proposition 16 campaign, PG&E maintained that the millions it spent on the ballot measure came from "shareholder funds" and from earnings that normally flow through to shareholders.

But critics pointed out that virtually all of PG&E's revenue is generated by its customers.

"PG&E's whole campaign for Prop. 16 was based on lies, and the biggest lie of all was that ratepayers didn't pay for it," said Mindy Spatt of the consumer advocacy group TURN, The Utility Reform Network. "They did."

The Leno bill stipulates that money derived from ratepayers cannot be used for political or public affairs expenditures. It would also require PG&E to report its annual political and public affairs spending to state regulators at the California Public Utilities Commission.


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"PG&E launched a dangerous and misleading political campaign — with ratepayer funds — that had only one goal, to preserve the corporation's monopoly," said Leno, D-San Francisco. "The state's largest electrical and gas company should not be able to use ratepayer-generated profits to write special rules into the state constitution protecting it from competition."

As written, Leno's proposed legislation does not apply to Southern California Edison or San Diego Gas and Electric, the state's other investor-owned utilities.

PG&E spokeswoman Cindy Pollard said Monday she had just learned about the bill and was still in the process of formulating a response.

Contact Dana Hull at 408-920-2706. Follow her at Twitter.com/danahull.