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California Regulators, Lawmakers Need to Lead More, Official Says

California's state regulators and legislators need to take a more aggressive energy leadership role if the nation's most populous state is going to be on the cutting edge of energy efficiency and climate change mitigation, said an outgoing member of the California Public Utilities Commission (CPUC).

The CPUC has lost some of its momentum and state lawmakers are too adversarial in their dealing with the state regulatory commission, said Mark Ferron, speaking last Thursday at his final CPUC business meeting. A day earlier Ferron announced he was stepping down due to prostate cancer.

An example Ferron cited to support his criticism of the legislature is the recent decision by the nonpartisan state Legislative Analyst's Office to kill a $65.9 million expenditure to conduct five CPUC-approved pilot energy efficiency programs using utility ratepayer-supported financial mechanisms (see Daily GPI, Sept. 23, 2013).

The CPUC efficiency pilots were developed in response to a 2009 state law (AB 758) that mandated the regulatory panel study and come up with potential roles for energy utility customer-supported programs that will test market channels for attracting more private investment in efficiency for residential, small business and larger commercial-industrial plants. It didn't pass budgetary scrutiny from the Legislative Analyst.

In stepping aside midway through a six-year CPUC appointment from the governor, Ferron was unsparing in his criticism for state lawmakers, lamenting their "almost knee-jerk hostility toward the CPUC," but he also was critical of the regulatory panel, saying it has "reacted too slowly to the changing landscape."

Similarly, while complimenting the state's major investor-owned utilities for being "more enlightened" on climate change issues than their counterparts around the nation, Ferron lambasted the utilities for their "legalistic, confrontational approach to regulation."

In an ideal world, Ferron said the CPUC, utilities and state elected officials would be working more in tandem to address what he called "an inflection point where the convergence of new technologies, changing economics" call for an "added sense of urgency to address our deteriorating climate." The response, he said, could "create some exciting new business and policy opportunities."

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