By Douglas P. Shuit
TIMES STAFF WRITER

CALIFORNIA-Weeks before the November 3 election, the California Energy Commission prepared but then withheld an analysis of Proposition 9 that showed the measure would have dramatically reduced electric rates for nearly 10 million Californians. The study, finalized on October 16 but not released until this week (Nov 19), concluded that under Proposition 9, ratepayers of Southern California Edison, Pacific Gas & Electric and San Diego Gas & Electric would have received reductions of 11% to 18% over what they now pay.

Addressing another campaign issue, the study said that closing PG&E's heavily subsidized Diablo Canyon Nuclear Power Plant would not pose a significant loss to the state's electricity supply because other sources were being developed. Because it would have helped debunk claims by Proposition 9's opponents that the initiative would lead to higher electric rates, release of the study would have aided the measure's sponsors, whose arguments were overwhelmed by the more than $40 million spent by the utility industry during the campaign. It also might have injected an objective voice in the back-and-forth over an initiative whose arcane provisions - from utility de-regulation to multibillion-dollar bond sales - beffudled many voters.

"We were shocked," said Doug Heller, a spokesman for Californians Against Utility Taxes. "The public would have benefited by release of the report." Proposition 9, which was defeated by about a 3-1 margin, called for a 20% reduction in electric rates for residential and small commercial customers of state-regulated utilities and an end to subsidies for nuclear power plants. Private utility companies contended in their media blitz that the initiative would result in higher rates. The utility companies also argued during the campaign that provisions of the measure ending nuclear subsidies would cripple the state's power supply, causing increased demand on remaining supplies that would push electric rates higher. (When nuclear power was introduced, no private insurance companies would underwrite it, so the Federal Government had to underwrite it with special legislation. The issue of nuclear power was never presented to the electorate to approve, it was always imposed upon the people without their consent. Now that it has proven unprofitable, the same people want to force the population to pay for their mistakes. WFI Editor)

Fearing that the state Energy Commission, composed of Republican Governor Pete Wilson's appointees, would write a politically skewed report critical of Proposition 9, two leading sponsors of the initiative sent a letter to Energy Commission chairman William J. Keese in September urging him to avoid any action that would "influence the outcome of the election." Citing the study they knew was in the works, Harvey Rosenfield, a co-author of Proposition 9, and Harry Snyder, an attorney for Consumers Union, wrote: "The Energy Commission has no business participating in the political campaign for or against Prop. 9. It has neither the legal authority, nor the resources, nor the expertise to weigh in on fiscal or political matters." Energy Commission attorney William Chamberlain said that when the staff completed its study in mid-October, he advised the commission to hold the report until after the election in part because of the letter.

"We intended the report as a balanced presentation of facts, but because it might be interpreted as something else, I felt the commission ran a risk if it put out anything at all," Chamberlain said Wednesday. (Of course, the fact that the report went against the interests of the majority of the commission members, was probably the decisive factor in the decision to delay its release. WFI Editor) Chamberlain said the issue fell within a gray area of the law. He said the law prohibits the commission from advocating one side or the other in an election, but acknowledged that state agencies clearly had a right to make objective analyses of issues. Keese said Chamberlain relayed his concerns during a closed-door executive session with the commission, which is responsible for licensing power plants and making forecasts about energy supply and demand in California.

Keese said the five commissioners hoped to have their study reviewed by outsiders before it was released but were unsuccessful. "Our counsel said the closer we got to the election the more it might appear we were trying to influence it," Keese said. "The decision was made that we are too close, we just can't do it." (The letter from the Proposition 9 proponents gave the commission a pretext for delaying the release of the report on Prop. 9. WFI Editor) Snyder said he was infuriated by suggestions that the letter he drafted with Rosenfield was being used as a reason to hold up the report. Snyder said the commission had an obligation to release the report, which was prepared at taxpayers' expense and drafted by state employees.

"It was their job and duty to tell the public what the impact of Proposition 9 would have been and they failed in that duty," Snyder said. Clarence Brown, a spokesman for Southern California Edison, said he did not believe holding up the report had a significant impact on the election. (After all, the opposition to Prop. 9 - the utility companies - had outspent their opponents many times over, which was paid for by ratepayers. WFI Editor) Chris Warner, chief counsel for regulatory affairs at PG&E, said the report did nothing to shoot down the belief by utilities that electric rates could rise sharply if there was an immediate shutdown of Diablo Canyon. In July, the commission released a preliminary staff analysis of Proposition 9 showing it would have provided consumers with rate reductions of 24% to 37%. Snyder and other sponsors of the initiative jumped on that study and used it in trying to sell their measure. The utility companies criticized its conclusions, causing the commission to order a second study; the second study came out after the election.

SOURCE: Excerpted from the 19 November, 1998, issue of the Los Angeles Times, Orange County Edition, from an article entitled, "Study on Electric Initiative Shelved Before Election." Reprinted in the public service of the national interest of the American people.