One unexpected side effect of the massive California fires is the recognition that Pacific Gas & Electric, a traditional model utility, is totally unable to deal promptly with the causes of the fires or how to provide power while the fires rage. Desperate localities are beginning to think seriously about forming much smaller, locally owned utilities to bypass the PG&E problems. That’s an old solution that may become even more important now that the climate crisis and its consequences make nimble, local solutions more vital than ever before.
Publicly Owned Utilities Could Help Fight the Climate Crisis
Transitioning utilities to public ownership could help lay the groundwork for a renewable, just future.
By Greta MoranOctober 25, 2019
Earlier this month, Pacific Gas & Electric, the investor-owned utility company that supplies power to much of California, cut off electricity to over 700,000 customers. The company argued that such a drastic measure — the largest planned power outage in the state’s history — was necessary to prevent wildfires.
Yet for some activists, this bleakly framed choice served as another reminder that investor-owned utility companies are not positioned to manage our energy futures, especially as climate change raises the stakes.
In recent years, activists around the country, including in New York City, Boston, Providence, Chicago, Boulder, and Washington, D.C., as well as Northern California and Maine, have been working to transition utilities to public ownership, which would make them accountable to the public instead of investors. In Northern California, the Let’s Own PG&E campaign emerged shortly after the Camp Fire, the deadliest fire in California history, which was caused by PG&E power lines. In other parts of the country, activists are fighting against utility companies’ direct contributions to the climate crisis and systemic inequalities.
The fight in New York City has grown particularly heated over the past few months. In July, in the middle of a deadly heat wave, Con Edison intentionally cut off power to some of New York City’s poorest neighborhoods, sparking outrage. Last month, at a rally outside the National Grid office in downtown Brooklyn, activists from groups like Stop the Williams Pipeline Coalition and the New York City Democratic Socialists of America spoke out against investor-owned utility corporations’ continued investment in gas pipelines. In particular, they’re angry about National Grid’s push for the highly contested, twice-denied Williams Pipeline that would cut through New York Harbor and proposed rate hikes from the two major utility corporations.
“Both ConEd and National Grid are proposing to raise our rates to expand fossil fuel infrastructure,” Lee Ziesche, an activist with Sane Energy Project, told the crowd. “What they are proposing completely fails the climate test.”
The ultimate goal for some activists is to abandon investor-owned utility corporations altogether and build a more democratic system in their place. Last year, NYC-DSA launched a Public Power campaign to make the energy grid publicly owned. Building on this idea, on October 19, a coalition of grassroots organizations launched Movement for a Green New Deal, a campaign that will demand utilities be publicly owned as a key part of this transition. Giving the public control over New York City’s energy future, activists argue, could lay the groundwork for the just, rapid decarbonization of the energy sector.
“We could decommodify clean energy and guarantee it to all New Yorkers as a human right, much in the same way we already guaranteed clean water through our public water utility,” said Amber Ruther, an organizer with NYC-DSA, during a recent hearing before the New York State legislature.
Ruther argued in her testimony that investor-owned utilities are not positioned to tackle the climate crisis. “The incentive structure for private utilities was designed to encourage them to build as much infrastructure as possible,” said Ruther. “But now that incentive structure is obsolete and it’s preventing us from achieving our climate goals.”
To replace investor-owned utilities, the Public Power campaign is calling for a large-scale public utility. This could mean the expansion of the New York Power Authority, the largest state public utility in the U.S., or the municipalization of private utilities. Once established, a public utility would be responsible for the major work of transforming the grid, Aaron Eisenberg, an organizer with NYC-DSA, explained to Teen Vogue in an email.
Alongside the large-scale utility, the campaign envisions smaller community-owned energy projects. As a model, Eisenberg points to Sunset Park Solar, a cooperative solar array, which will be owned and operated by the same people who purchase its power in central Brooklyn.
The idea of publicly owned utilities is quickly gaining traction. Mayor Bill de Blasio recently suggested socializing the city’s utilities. In late July, New York City council member Costa Constantinides partnered with the NYC-DSA to host a town hall in response to ConEd’s proposed rate hikes. Over 100 people, including assemblyperson Aravella Simotas and public advocate Jumaane Williams, traveled in the pouring rain to attend the town hall, where many demanded public utilities.
But no one from ConEd or the New York Public Service Commission, which oversees the state’s utilities, showed up.
Jamie Tyberg, an organizer with New York Communities for Change, sees publicly owned power as an important step in transforming our relationship to resources and energy, which have for too long been regarded as infinite.
“We are not going to be able to escape this crisis without replacing the system,” Tyberg, who has been volunteering with the campaign, told Teen Vogue.
In response to the claims made in this article, Michael Clendenin, ConEd’s director of media relations, wrote in an e-mail, “We can maintain high reliability and have a clean energy future. Con Edison is committed to helping New York State achieve its clean energy goals, and through our Clean Energy businesses we are the 2nd largest solar producer in North America.” A spokesperson from National Grid responded to Teen Vogue‘s request for comment by providing links to their plan for “investing in the natural gas networks making them safer and more reliable, advancing a cleaner energy future.” (The idea that more gas networks will advance clean energy has no basis in climate science.)
A Widespread Movement, With Old Roots
Public utilities are hardly a new idea — over 2,000 public utilities already exist in the U.S. — but the growing demand for a more just energy system has lent this ownership model new energy.
This summer, Vermont senator and 2020 presidential candidate Bernie Sanders released his own version of an ambitious Green New Deal, which outlines a plan for renewable, publicly owned energy.
Sanders’s vision may look something like the energy system in the (admittedly less populous) state of Nebraska, which consists entirely of public power districts, publicly owned utilities, and energy cooperatives. The state abandoned investor-owned utilities in 1946 and remains the only state to operate fully on public power. Since then, Nebraska has been able to maintain some of the lowest rates of electricity in the country.
This future could also resemble Sanders’s own town of Burlington, Vermont, which has had a municipally owned utility since 1905. In 2014, Burlington became the first city in the U.S. to move to 100% renewables, while maintaining the same rates since 2009.
The city recently laid out a roadmap for an even more ambitious goal: moving to net-zero energy by 2030, which the city defines as “sourcing at least as much renewable energy as it consumes in energy for electric, thermal, and ground transportation purposes.”
Public utilities were also a component of the Green New Deal’s predecessor: Franklin D. Roosevelt’s New Deal. The 1936 Rural Electrification Act was passed to provide loans to isolated rural areas to start their own electric cooperatives. The goal was simple: to give farmers, left in the dark by profit-motivated utility companies, affordable electricity.
“At the time, investor-owned utilities were not really willing to go into rural America” because the sparsely populated areas did not promise good business, explained Johanna Bozuwa, who works at the Democracy Collaborative.
While today’s campaigns have broader visions, the main advantages of a public utility remain. They are designed to answer to the people rather than a profit motive. Public utilities have lower average rates than investor-owned utilities and any revenue made goes back into the community, rather than the pockets of CEOs and private shareholders. For instance, Austin Energy has used its revenue to support street lights, public safety, libraries, and parks.
Investor-owned utilities don’t have the same incentive. “As a topline, investor-owned utilities have a terrible track record,” said David Pomerantz, who works at the Energy and Policy Institute, a watchdog organization that tracks energy utilities. He points to the fact that investor-owned utilities are often the top contributors to political campaigns and spend millions on lobbyists. This year, National Grid even asked its own customers to help lobby for fracked gas.
However, Pomerantz cautions that public utilities are not blameless. Like private utilities, public utilities have trade associations, like the American Public Power Association (APPA) and National Rural Electric Cooperative (NREC). Both groups have fought EPA standards for clean air, water, and carbon pollution, Pomerantz explained in an email.
Bozuwa, of the Democracy Collaborative, sees the current moment as an opportunity to learn from public utilities’ mistakes and push this model in a new, bolder direction. “Public ownership is built within the context of the people who are organizing for it,” said Bozuwa. This grants the system its power and, historically, its limitations.
A New Era of Energy Democracy
Today’s emerging campaigns are calling for a new system of “energy democracy” altogether and share an overarching goal of climate justice. What this entails takes many forms.
“It’s a pretty simple piece of legislation [requiring] a very minor tax increase across the state, [that would mean] low-income payers would only need to pay a certain percentage of their monthly income as their utilities payment,” explained Corey Krajewski, an activist with the campaign.
Boston’s Take Back the Grid campaign has been focused on ensuring workers and communities of color in Boston benefit from the shift to a publicly owned renewable grid.
Similarly, Northern California’s Let’s Own PG&E campaign has been thinking through ways to ensure that the PG&E workers are included in the new energy system. One idea they’ve been considering is a proposed ballot measure to protect these workers’ pensions, explained Emily Algire, one of the organizers in the campaign.
In Maine, the local power supplier has been accused of erroneously charging customers. In response to disproportionately high rates, a group of over 600 rate-payers is suing the Central Maine Power Company, while also backing a bill to replace the two main power providers in the state with a statewide public utility, introduced by Representative Seth Berry. For Berry, it’s a major opportunity to address the climate crisis.
“Basically, we have to electrify our entire economy, and we have to do that really fast,” Berry said. “It’s like the foundation that we’re building our home on for the future.”