A Mighty Wind

[May 16th, 2007]

Email messages between PacifiCorp and Gov. Ted Kulongoski's top energy adviser show the utility has exerted tremendous influence in shaping a controversial renewable-energy bill.

The utility's role in Senate Bill 838, which would require 25 percent of Oregon's electricity to come from renewable sources by 2025, is puzzling on two fronts.

First, as recently as mid-January, PacifiCorp sought Oregon Public Utility Commission permission to build two massive new coal-fired generating plants—the polar opposite of "green" energy.

Second, the green energy mandates would put a heavy burden on Oregon utilities. And giving PacifiCorp the chance to dictate SB 838's terms is akin to letting the tobacco companies script the bill upping cigarette taxes to fund kids' health insurance.

PacifiCorp's explanation for its newfound greenness—that renewable mandates are inevitable—makes political sense. Nonetheless, hundreds of emails WW obtained this week under a public-records request show that Kulongoski's top energy staffer, Peter Cogswell, repeatedly let the utility (and, to a lesser extent, Portland General Electric) preview SB 838 and veto amendments while ignoring objections from Oregon's largest employers.

Before the bill's March 5 introduction, Cogswell circulated a draft to a coalition of consumer advocates and utilities, a list headed by PacifiCorp lobbyist Scott Bolton.

Cogswell then held a conference call to discuss amendments with PGE, PacifiCorp, OSPIRG and the Citizens' Utility Board. While most participants OK'd changes, PacifiCorp lawyer Brent Gale wrote on March 13, "PacifiCorp will need to review this language further before we can sign off."

Cogswell then forwarded proposed amendments to Bolton, writing: "I think it contains the language Brent was most concerned about...so start with this and I will get you the final version ASAP."

What's also noticeable is who's not in all the email traffic: the Industrial Customers of Northwest Utilities, which represents the state's biggest electricity buyers.

"We have been totally excluded from drafting the bill and reviewing amendments,'' says Melinda Davison, a longtime lawyer for ICNU. "It's very uncommon not to seek the input of a major ratepayer group."

In a March 15 Senate hearing, ICNU voiced concerns about the bill's potential rate impacts.

"I felt the hearing didn't go so great yesterday," Jason Eisdorfer of the Citizens' Utility Board emailed Cogswell the next day. "The opponents landed a lot of substantive punches (even if they sucked). Meanwhile the proponents are saying things like 'renewable energy is good.'"

But Cogswell dismissed ICNU's concerns.

"ICNU's concerns have more to do with hating or not trusting utilities rather than legitimate substantive concerns about the bill," Cogswell wrote Kulongoski's assistant chief of staff Allen Alley.

Other groups outside Cogswell's coalition also saw their interests subjugated to PacifiCorp's. On March 23, for example, public power advocate Dan Meek emailed OSPIRG lobbyist Jeremiah Baumann two amendments his group wanted.

"I can't imagine Bolton would be OK with it," Baumann wrote in forwarding Meek's email to Cogswell. "That's sort of what I figured," Cogswell replied on March 26.

Cogswell has strong ties to PacifiCorp. Before joining Kulongoski's office in 2004, Cogswell worked four years for the utility, where he hired Bolton as its lobbyist. More recently, Cogswell reported to Pat Egan, who left as Kulongoski's chief of staff in January to join PacifiCorp.

It's clear that the three enjoy a close relationship. In emails, Egan proposes four social meetings with Cogswell, while Bolton arranged for Cogswell to moderate a panel at a utility finance conference.

Cogswell denies showing favoritism to PacifiCorp or allowing his ex-employer to unduly influence legislation. "I know who I work for,'' he says. "I didn't do any more for PacifiCorp than anybody else."

He says working closely with PacifiCorp and PGE was simply pragamatic given how complicated the bill is. "Including the utilities is the only way to make sure there aren't unintended consequences," Cogswell says.

He adds that ICNU rejected chances to join the coalition, a claim Davison strongly disputes.

Other emails show SB 838 proponents even enlisting PUC Chairman Lee Beyer to lobby Sen. Frank Morse (R-Corvallis). By law, the PUC is a regulator, not an advocate. Yet Beyer, a Kulongoski appointee, sent Morse information prepared by bill proponents.

Though Beyer denies lobbying and calls his contact with Morse routine, he says, "Attaching proponents' information probably wasn't the best idea."

Objections from ICNU, consumer groups and rural electric co-ops have slowed the Senate-passed bill in the House, but a floor vote may come as early as next week. Anxiously watching: Oregon's largest employer, Intel.

"When folks tell me that they're fine with Intel paying $2 million more a year in energy costs because it serves the greater good, that's what has me concerned,'' Intel lobbyist Jonathan Williams emailed Cogswell on March 13. "That's a problem that needs to be solved because it's not just us that gets whacked, it's the entire manufacturing community in the state."