SCE Leads Effort to Kill Legislation in Way of Merger : Bill Appears ‘DOA’ After State Committee Hearing

In another demonstration of its lobbying muscle, Southern California Edison on Tuesday led the effort to all but kill antitrust legislation that could hamper its planned $2.4-billion merger with San Diego Gas & Electric Co.

The latest casualty in the legislative slugging match over the proposed merger was a bill sponsored by Assemblyman Lloyd G. Connelly (D-Sacramento) that would allow the state attorney general to halt the SDG&E; deal and other corporate acquisitions if they are found to be monopolistic and bad for California consumers.

The bill passed the Assembly in May, but not before Edison prevailed on lawmakers to attach a proviso that specifically exempted the SDG&E; merger. The company argued that the merger is already scheduled to undergo thorough scrutiny by the California Public Utilities Commission and the Federal Energy Regulatory Commission.

However, when the bill landed in the Senate for further debate, Sen. Larry Stirling (R-San Diego) persuaded his colleagues on the Judiciary Committee on June 30 to strip away the SDG&E; exemption, making sure the antitrust bill would apply to that merger as well.

The move by Stirling, a staunch opponent of the SDG&E; deal, apparently caught Edison by surprise. No one from the company was at the committee hearing last month to object.

“We caught them with their lobbyists down,” Stirling said.

But not for long. As soon as Edison realized it had lost its exemption, the company renewed its lobbying efforts against the legislation, said Lew Phelps, Edison’s vice president for corporate communications.

“We did not get actively involved on the bill on the Senate side until the exemption was yanked away,” Phelps said. “Yes, we expressed our views vigorously and appropriately.”

As a result, when the bill was taken up for reconsideration Tuesday, it was all but pronounced dead. An SDG&E; lobbyist told others standing in the hallway outside the hearing room that Connelly’s bill was “DOA.”

And even Sen. Bill Lockyer (D-Haward), chairman of the Judiciary Committee, said during the hearing that he doubts the antitrust bill would ever pass out of the 11-member Senate committee, no matter what changes were made.

“I would guess it would be very difficult to find six votes (a majority) to move this bill out of committee, and I don’t know if that’s going to change, no matter what amendments are offered,” he told Connelly.

Still, Connelly said he wanted the Senate committee to schedule a vote next week on the bill, even if it is bound for defeat.

“We’re going to force a vote on it,” Connelly told reporters after the hearing.

Asked if Edison’s lobbying efforts were responsible for crippling--if not killing--his antitrust bill, Connelly said: “I think that’s an accurate assessment. . . . They’ve had an impact.”

Added Stirling, who has seen two of his own bills go down to defeat in the face of Edison opposition, “I think it (Connelly’s bill) is dead.

“It shows once again that Edison has 100 years of experience of manipulating the government and they are very good at it. They did it again.”

Phelps, however, said the utility will back away from its opposition to the bill if the Senate agrees to restore the exemption for the SDG&E; merger.

He also pointed out that banking, insurance and manufacturing interests have opposed the Connelly legislation.

“I hope we did make a difference, but I don’t think it is appropriate to say that we are the only factor involved,” Phelps said.