Public Utilities Commissions, with EarthJustice’s Jill Tauber

What are public utility commissions (PUCs)?  In the transition to clean energy, state public utility commissions (PUCs), which regulate electric, gas, telecommunications, water and wastewater utilities, play an increasingly important role in achieving energy efficiency, enabling renewable energy, and implementing policies for greenhouse gas emissions reduction. PUCs  play a pivotal role in determining the energy mix, setting rates, and deciding on investments in infrastructure, such as electric vehicle (EV) charging stations. The California Public Utilities Commission (CPUC), for example, has to balance  safety, reliable utility service, and reasonable rates through the regulation of various large investor-owned electric, natural gas, and water utilities. Utility commissions like CPUC are given a statutory mandate to ensure reasonable, adequate and efficient service to customers at just and reasonable prices. PUCs can issue regulations that impact electricity generation, the adoption of clean energy, and related emissions of pollutants and GHGs. PUCs can play an important role in shaping energy infrastructure, policy, and clean energy development. The Role PUCs play in shaping energy infrastructure PUCs were first created in the early 20th century to focus on overseeing operations and the utility investment in service while ensuring affordable rates. That role has evolved, and now PUCs often play a transformative role in transitioning towards a greener economy. PUCs have the ability to consider the impacts of GHG emissions, equity, grid reliability, distributed energy resources, and increased consumer choices in their policy decisions.  PUCs oversee planning processes that affect a utility’s resource portfolio and therefore its environmental profile. A new method of planning amongst PUCs has emerged known as Integrated Resource Planning (IRP), which compares the life cycle costs of different resource choices that factor energy efficiency into their analysis. Portfolio standards have also been added to IRP, which requires certain types of resources to be included in the utilities’ mix of power procured, including renewable energy and energy efficiency. PUCs can also incorporate environmental considerations by increasing oversight of utility planning processes, setting prices, determining clean energy targets, and addressing utility incentives related to energy efficiency and distribution. PUCs thus have the ability to promote and shape clean energy adoption and development through their regulatory oversight.  The Case for PUCs State PUCs have significant authority, often includingI the ability to accelerate decarbonization of the energy sector, mitigate the impacts of climate change, improve public health, and assist in reaching state energy goals. Updated PUC statutory mandates that reflect state energy priorities can contribute to their success in transforming the energy grid to become more energy efficient. Energy efficiency is a cost-effective mechanism to meet future demand for electricity. Energy efficiency reduces the amount of electricity needed to meet demand thereby benefiting the overall reliability of the electric grid. With more efficient systems, utilities and states will not need to build as much new transmission and generation, which can save money and improve environmental quality. Further, modern regulations to achieve such priorities and framing for the public interest can incorporate climate and environmental justice concerns.  The Case Against PUCs Organizational challenges such as outdated mandates, staff constraints, gaps in technical knowledge, misinformation, and quasi-judicial processes have created barriers to innovation amongst PUCs. Some PUCs still continue to view themselves as purely economic regulators, which does not accurately reflect the current decisions they are being asked to make. Additionally, the authority of PUCs varies widely from state to state. PUCs authority is established by state legislatures, thus their power only extends as far as their statutory authorization. The level of statutory authority delegated to PUCs by legislatures also varies widely. Barriers such as these have made it difficult for some  PUCs to develop more innovative mechanisms consistent with new environmental targets and the effort to achieve a zero-carbon US grid. While transitioning to clean energy promises long-term savings and environmental benefits, the short-term costs can be significant and potentially burdensome for consumers and businesses, posing political and fiscal challenges for PUCs. Stakeholder engagement in this transition will be vital. Labor issues also pose challenges as states transition away from  fossil fuels. In addition, challenges exist around regulatory complexities and the evolving federal and state policies.  About Our Guest Jill Tauber is the Vice President of Litigation for Climate and Energy at EarthJustice. Jill leads the organization in achieving an equitable shift to clean energy through her litigation and legal advocacy work. Prior to serving as VP of Litigation, Jill worked as the Managing Attorney of Earthjustice’s Clean Energy Program, focusing on achieving clean energy solutions across the country.ResourcesRMI: Purpose: Aligning PUC Mandates with a Clean Energy FutureRMI: The Untapped Potential of Public Utility CommissionsEPA: U.S. Environmental Protection Agency State Climate and Energy Technical Forum Background DocumentFurther ReadingColumbia Law: Public Utility Commissions and Energy Efficiency For a transcript, please visit https://climatebreak.org/public-utilities-commissions-with-earthjustices-jill-tauber/