Broad Coalition Forged to Fight Utility Merger
In a highly unusual show of cooperation, a wide array of business, labor, government, environmental and consumer representatives Thursday announced the formation of a coalition to begin a “siege” of Southern California Edison that is designed to stop a proposed merger with San Diego Gas & Electric Co The newly formed Coalition for Local Control hopes to raise $200,000 to stage a two-year fight against the proposed merger, according to Great American First Savings Bank Chairman Gordon Luce, the coalition’s chairman. San Diego’s business community so far has pledged more than $30,000 to combat the proposed merger, which Luce described as “one of the most significant economic events of this century” in San Diego.
The coalition includes several well-known business and government leaders, the Greater San Diego Chamber of Commerce, the Utility Consumers Action Network, the Sierra Club’s San Diego chapter, the San Diego Economic Development Corp. and Local 465 of the International Brotherhood of Electrical Workers.
‘Not a Bedroom Community’
“San Diego would become the only one of the top 10 cities in America serviced by a utility headquartered outside of the city,” Luce said during a Thursday-morning press conference. “Our energy future is critical to our economic destiny. . . . We are not a bedroom community to be left at the mercy of a company whose first loyalty is to Los Angeles.”
The proposed merger “means a significant loss of jobs, deterioration of our air quality, higher energy rates and the ‘Los Angelesization’ of our utility company,” said Greater San Diego Chamber of Commerce President Lee Grissom.
Luce predicted that private sector participation--and donations--will grow as the business community learns “that rates for businesses, commercial enterprises, (and) industrial plants . . . will be going up if Edison is in charge of our utility,” Luce said.
Besides organizations, the coalition has attracted support from more than 70 “private sector” members. The initial list unveiled on Thursday resembles a “Who’s Who” in San Diego.
The list includes San Diego State University President Thomas Day; General Atomics owner J. Neal Blue; Home Federal Savings & Loan Chairman Kim Fletcher; Dr. Fred Frye; businessman George Gildred; Chamber of Commerce Chairwoman Gail Stoorza Gill; developer Tawfiq Khoury, and builders Warner Lusardi and Mike Madigan.
Coalition Lacks Money
Luce readily acknowledged that the coalition lacks the money to match the cash-rich utilities. For example, while the coalition hopes to raise $200,000, SDG&E; recently spent nearly $400,000 to produce and mail anti-government-takeover brochures to its residential customers.
“We have people resources but we do not have the money resources,” Luce acknowledged. “We’d like to do that kind of mailing, but we can’t do it as broadly or as expensively . . . it’s just not in the cards, and I don’t think we should fool ourselves.”
Grissom downplayed the significance of the utilities’ cash reserves, arguing that the advertising campaigns run so far by SDG&E; and Edison “are an abuse of money . . . if we had the same amount of money to spend as SDG&E; (and Edison) I don’t think I would spend it that way.”
Credibility at Issue
Luce and Grissom also claimed that utility executives at both companies have lost their credibility among San Diegans, particularly on the sensitive subject of how many San Diegans would lose jobs because of the merger.
“I can’t quote the source, but one person said to me in a high executive office of (SDG&E;) that it could be a thousand or 2,000 jobs,” Luce said. “That worries me.”
Spokesmen for SDG&E; and Edison on Thursday repeated their previous statements that only 1,000 jobs would be lost at the two companies.
Grissom and other coalition members complained that Edison and SDG&E; are conducting a “disinformation” campaign that is designed to take the proposed merger out of the media spotlight and refocus attention on a possible government takeover of SDG&E.;
Merger Targeted
At present, there is little reason for discussion of a municipal takeover, according to coalition member Michael Shames, who serves as executive director of Utility Consumers Action Network, a San Diego-based consumer group. “If the merger was defeated, then municipalization isn’t really an issue,” Shames said Thursday. “I think all (coalition members) agree that we have to beat the merger.”
The newly formed coalition opposes a merger of SDG&E; and Edison, but it has stopped short of embracing a government takeover, according to Luce. “We favor a privately owned, locally controlled utility,” Luce said.
The coalition, which is housed in the Chamber of Commerce’s office building, expects to hire an executive director within the next week.
Mayor Speaks Out
In a related development, Mayor Maureen O’Connor Thursday urged community leaders to aid the newly formed Coalition for Local Control with “money” and “talent.”
O’Connor, declaring that “the proposed Edison takeover of SDG&E; represents the single greatest threat to San Diego’s autonomy in the 17 years that I have been in public life,” asserted that the two utilities will spend $25 million between them “to force this takeover on us.”
“Collectively, this group can fight the bully boys,” O’Connor told a Rotary Club of San Diego luncheon at the Sheraton Grand Hotel. “You can make your voices heard” by contacting congressmen, state legislators, the state Public Utilities Commission and the Federal Energy Regulatory Commission, she added.
O’Connor spoke of her “fear of monopolization” and the evils it would bring to San Diego. “The new Los Angeles-area company would not just gobble up one more corporate headquarters from our city, but in so doing would become the largest utility in the country, a utility without competition, a monster utility, a monopoly!,” she said.
The mayor hinted that the new utility, unfettered by competition, would be unaccountable to its customers, particularly after current Chief Executive Officer Howard Allen is replaced.
“What saint, as CEO of Edison, would not use an earthquake, a flood, a drought, a strike or an oil spill as an excuse to raise rates beyond honest levels?” she asked.
Edison spokesman Lewis Phelps responded that “it is unfortunate that Mayor O’Connor has so little understanding of the regulatory process that she does not recognize that Edison’s rates are regulated today by the Public Utilities Commission and they will continue to be fully regulated after the merger.”
