Commerce nominee John Bryson fought to keep Edison out of bankruptcy
John Bryson’s work life has bounced from environmental activist to California regulator to utility company executive and now to nominee for Commerce secretary. But his career so far has been defined by the one stop he never made — Bankruptcy Court.
As chief executive of Edison International, Bryson fought tirelessly to keep the company from collapsing during the California electricity crisis a decade ago. He went on TV to beg customers to conserve energy. And he forged controversial deals with state officials to avoid the fate of fellow utility Pacific Gas & Electric Co., drawing the wrath of consumer groups for locking in high electricity rates to keep Edison out of bankruptcy.
Within months, the corporate parent of Southern California Edison returned to profitability. And, unlike other key players in the crisis, Bryson emerged with his reputation burnished instead of tarnished.
“At the end of the day, John got most of what he wanted. The company did not have to go into bankruptcy,” said then-Gov. Gray Davis, who was involved in lengthy negotiations with Bryson over Edison’s fate. “He made it very clear he didn’t want to go that route. He said that a zillion times.”
But such success isn’t helping Bryson win Senate confirmation. Some Republicans aren’t impressed with his business credentials, branding him as an environmental extremist and vowing to block his confirmation.
Bryson’s supporters counter that his wide-ranging experience and actions guiding Edison through the crisis highlighted the skills that would make him an excellent Commerce secretary — determination, diplomacy, an ability to quickly grasp complex issues and steadiness under fire.
“There was an unflappable quality to him, cool under pressure,” said Robert A. Iger, chief executive of Walt Disney Co., where Bryson served as a director at the time of the crisis. “I never got a sense that John, at least outwardly, was feeling the stress.”
In a Senate hearing last month, Bryson, 67, who retired from Edison in 2008 after 18 years as CEO, said keeping Edison out of bankruptcy was the “single toughest challenge I’ve ever addressed.”
“We stuck together as a company and we kept the lights on under impossible circumstances for at least two years,” he told senators. “And in the end, I think we were proud … for what we were able to do without going into bankruptcy as others did.”
Administration officials declined an interview request for Bryson, following standard policy of preventing nominees from speaking to the media until they are confirmed.
He would face new challenges should he be confirmed to lead the Commerce Department. With the economy struggling, companies hesitant to hire and the Obama administration viewed as unfriendly to business, the normally low-profile position has taken on added importance.
But Bryson faces a surprisingly tough confirmation fight.
On Tuesday, Sen. James M. Inhofe (R-Okla.) placed a hold on the nomination, a procedural hurdle that will take 60 votes from Bryson supporters to overcome.
Nearly all Senate Republicans already had vowed to block the confirmation of any nominee for Commerce secretary in a dispute over pending free-trade deals with South Korea, Panama and Colombia. Agreements, though, could be reached in the coming days.
Some conservatives have criticized Bryson for his involvement with companies that depend on government regulation or subsidies. Those include Edison, a regulated utility, and BrightSource Energy, a solar-energy firm whose board Bryson chairs. A Wall Street Journal editorial dubbed him “Secretary of Subsidy.”
And some Republicans have rebuked him for being one of six co-founders in 1970 of the Natural Resources Defense Council, an aggressive organization that often has sued companies for allegedly violating environmental regulations. Bryson also has come under fire for favorable comments he made in 2009 about a Democratic House bill to address climate change.
“His approach … toward affordable energy is harmful to American businesses,” said Sen. John Barrasso (R-Wyo.), who called the NRDC one of the nation’s “most extreme environmental organizations.”
Bryson did a good job promoting energy efficiency and electric transportation, but “the last thing you could call him is an environmental extremist,” said V. John White, executive director of the Center for Energy Efficiency and Renewable Technologies in Sacramento.
“He bought coal plants. He successfully blocked power plant controls that should have been installed 10 years earlier. And he actively resisted renewables until the end of his career” at Edison, White said.
Bryson started out as an environmental lawyer. But the people who helped him found the NRDC thought he was destined for more.
“John was tall, outgoing, charming, confident and ambitious in the best sense of the word,” wrote fellow NRDC co-founder John Adams in “A Force for Nature,” a 2010 history of the organization he wrote with his wife, Patricia. “Meeting him, we immediately saw his potential for accomplishing great things, perhaps a career in politics.”
Bryson stayed with the group for a few years, opening its West Coast office. He moved on to state government, heading the California State Water Resources Control Board from 1976 to 1979 and then serving as president of the California Public Utilities Commission from 1979 to 1982.
Southern California Edison hired Bryson in 1984 as a senior vice president in a move designed to bring a “new dimension” to its management, it said at the time. He rose to chief executive of the utility’s parent company in 1990, and was hailed as the model for an environmentally friendly executive.
Bryson advocated for energy efficiency and renewable sources, such as solar and wind power. He also supported the flawed deregulation of the state’s electricity market, said Steven Weissman, director of the Energy and Cleantech Program at the UC Berkeley law school.
That support meant Bryson played a role in the crisis that nearly bankrupted Edison.
“The fact that the company was in financial trouble during the crisis is really not so much a reflection of … the way it was managed,” Weissman said. “It was an indictment of the underlying premise for deregulation as it was designed in California.”
A flawed law and market manipulation by energy trading companies such as Enron Corp. caused wholesale electricity prices in California to soar, sparking the crisis. Bryson later said Edison complained about some parts of the deregulation plan when it was being drafted, but acknowledged that no one foresaw the huge rise in prices.
Unable to pass on all the higher costs to its customers, losses mounted for Edison and other utilities in early 2001. Whereas PG&E opted to file for bankruptcy, Bryson worked behind the scenes to cut a deal with state officials to save his company.
The eventual agreement with the Public Utilities Commission allowed Edison to pay off about $3.3 billion in debt it had accrued from the soaring electricity prices. But it also kept electricity rates high.
“Shareholders well may have been impressed, but consumers weren’t,” said Mindy Spatt, spokeswoman for the Utility Reform Network, a ratepayer advocacy group.
Still, Bryson earned wide praise. In 2002, with the company profitable again, Edison’s board gave him a $1.35-million bonus for his leadership during the crisis.
“I think that by most estimations, and certainly by mine,” said Ralph Cavanagh, NRDC’s energy program co-director, “Bryson was one of the people who distinguished himself through all that.”
