PrintJanuary 6, 2011
Saving California Almost Half a Billion a Year -- Easy
Congratulations to Jerry Brown on his latest electoral victory. We all wish him the best of luck in straightening out California's budget mess. We're in the hole big time, and he don't seem to have a coalition willing and able to create a balanced budget anytime soon. Few in his party are willing to stop the gravy train with which they buy the votes to keep themselves in power. He'll increase taxes only over the vocal objections of the Republicans and the citizenry who will pay those taxes. Businesses hardly need another reason to pack up and leave the state, taking many jobs -- and tax revenues for the state -- with them.
OK, so cutting spending is difficult. Somebody's rice bowl will be broken, so let's pick off a weakling, an agency that few love, with no union backing and no real constituency. I can suggest an agency that Governor Brown created back when he was governor the first time. This agency serves an important role in neither the governance nor the economy of the state. It is really pretty useless -- nobody but the environmentalists and the greens have much use for it. Plus, it has done a bang-up job of annoying the voters and continues to issue regulations that are in fact little more than petty tyrannies with no positive effect or necessity. We voters would be happy to live without them. Yet we taxpayers spend almost half a billion dollars a year on the agency ($407 million in 2009/2010).
That agency is the California Energy Commission (CEC). As far as I can tell, they do four main things. First, they keep statistics on the state's energy consumption, production, transmission, and the like. Second, they are one of the many permitting stops for new power plants, pipelines, transmission lines, etc. Thirdly, they spend money on energy research. Lastly, they issue energy conservation regulations like the infamous remote-control thermostats first exposed here in 2008 and now the ban on incandescent light bulbs.
The first function, the statistical information-gathering, is done already by the federal Department of Energy. A large amount of important state-specific data is also collected by the California Public Utilities Commission (CPUC). If the CPUC or DoE are missing something important, with real users with real needs, we can just shift that data set task over from the CEC to the CPUC.
The second task, state-level permitting of energy facilities, might have some justification. A friend who was a former commissioner argues that the CEC serves not by adding another permit to an energy developer's burdens, but by preempting a bunch of local permits, allowing a power plant, say, to not be blocked by local NIMBY politics. Frankly, I don't think that's what really happens most of the time, but I'll grant that this has some value -- $2.5 million a year in the last budget, or 0.6% of the total budget.
The third function is energy research and development. I'm at a loss to explain why this function needs to be carried on using California state tax dollars at all. Certainly some basic research might be justified by government in general, but what R&D benefits would accrue solely to the taxpayers of California from anything useful that might come out of this? Wouldn't a federal-level program be more effective and equable? There was that huge project to assess the effects of global warming on California recently; how much taxpayer money was funneled through the CEC is hard to determine, but 1¢ would be too much in my book.
Lastly, they issue regulations -- lots and lots of regulations. They tell you what to use to light your home, how thick your insulation must be, what type of washer/dryer you can buy, how big your pool pump can be, how big your windows can be, whether you can leave your porch lights on at night -- 176 pages for buildings alone. While a few could be justified for safety reasons or for hidden features for subsequent occupants/owners, most are intrusive and no business of government. The underlying premise is that the collective interests, as determined by the people at the CEC, overrule any rational consideration of cost and benefit by a free citizen or inhabitant of the state of California. Or maybe it is just because they think we're stupid?
So of the four main activities of the CEC, I can possibly justify 0.6% of their budget -- the part about statewide permitting -- or $2.5 million. We could easily move this function to another, existing agency like the Department of Water Resources (they run the state's dams and irrigation systems). We might need to transfer a million or so to the Public Utilities Commission for continued collection of "essential" data. That would give the taxpayers a net savings of $400+ million the first year. Note that since 1997, we taxpayers have already spent $3.9 billion on the CEC. Why pour more money down that rat hole of an agency?
Now, it is not like I've got anything personal against the people at the CEC. I just think that if they were laid off and went out and found jobs in the private energy sector, they would cost me less and do more good for everyone -- like produce energy that people would pay for voluntarily. Has the California Energy Commission ever made energy?
Besides the employees, who will cry if the CEC goes away? Energy "activists" are one group, of course. So are the many consultants and grantees on the CEC's dole. Perhaps there are some idealists in the state legislature who really think that forcing people to use less energy, or energy they approve of, is really the moral high ground. But add them up, and they are not a potent political force. How much push-back will it take to keep funding this agency when there is no money?
So this is one specific, concrete proposal to make a small dent in the big money pit my state is facing. Let me encourage other concerned citizens to dig into their states' budgets and organization and find other specific savings concepts. While taking on the state Department of Education might be quixotic, the easy pickings are those with a small or relatively powerless constituency and no essential role in governance. A politician can kill an agency if it doesn't cost him or her many votes. Every government has those pockets of needless expense; one of our responsibilities as concerned citizens is to find and expose them and push our elected representatives to kill them off. Even small victories can add up.
The author has been involved in the energy business in California for over thirty years.
