As evidenced by a group of awards at the most recent meeting of the California Public Utilities Commission (CPUC) earlier this month, the now three-decade-old practice of reimbursing consumers and consumer organizations for their contributions to various regulatory cases is still a thriving business in the state, totaling more than $3.7 million awarded by the CPUC last year.

Dating back to the late 1970s with CPUC and state Supreme Court actions following the concept of “intervenor funding” being developed in the 1978 federal Public Utility Regulatory Policies Act (PURPA), California’s program subsequently has been embedded firmly in state law and state regulatory policy.

Basically, it says that legitimate consumer organizations or individuals can apply for and get reimbursement for legal and other expenses they incur in cases where the CPUC determines that they provided a “substantial contribution” to the final outcome of the case. The private-sector utilities involved in the case then pay the awards with shareholder — not ratepayer — funds.

Two long-standing utility consumer action groups, San Francisco-based The Utility Reform Network (TURN) and San Diego-based Utility Consumers’ Action Network (UCAN), among others, have collected millions from the program over the past three decades. Other groups and individuals, some more narrowly focused nonprofits, also participate in the program.

In its third meeting of the year earlier in March, the CPUC decided a very unpopular multi-billion-dollar rate case involving Southern California Edison Co., but on its consent agenda for which there is no public discussion, six intervenor cases totaling nearly $400,000 in compensation were approved by the CPUC for consumer groups and individuals (see Daily GPI, March 17).

One of the awards involved TURN, which had asked for $107,491 to recover its costs of being a party in the Edison utility general rate case, but the CPUC decided the consumer group was only due a $96,715 award.

TURN, which is usually active in 70 to 90 CPUC energy and telecommunications cases in any given year, received about $2.3 million in intervenor awards for its most recent fiscal year for which it has complete records (July 2007-July 2008), a San Francisco-based spokesperson for the organization told NGI Wednesday. “We don’t ask for intervenor compensation on every case on which we work,” the TURN spokesperson said.

Intervenor funding, which is based on various hourly attorney fees applied to particular cases, makes up the majority of TURN’s annual operating budget — from 60% to 70% — according to the spokesperson. The number of attorneys from the group billing for hours on a particular case will vary. Overall, the utility consumer organization that established it reputation in the 1960s opposing San Francisco-based Pacific Gas and Electric Co. in various rate cases, now employs six full-time energy attorneys, full- and part-time telecommunications attorneys, and a telecommunications research director.

CPUC statistics show that 63 awards in 2008 were divided among 20 groups and individuals with the vast majority going to four organizations — TURN; UCAN; an agriculture consumer organization, Aglet Consumer Alliance; and the Natural Resources Defense Council, which collectively received 46 of the awards. TURN led the way with 28, all of which except two involved one or more of the major energy utilities.

Of the $3.7 million awarded last year, TURN garnered nearly half of the money, about $1.7 million from a rough total of the list of awards supplied to NGI by the CPUC.

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