Report: CPUC's Peevey improperly negotiated SDG&E power deal

Dive Brief:

Michael Peevey, the former head of the California Public Utilities Commission (CPUC), improperly negotiated a purchase contract forcing San Diego Gas & Electric Co. to purchase $700 million in power, the LA Times reports.
A former lawyer for SDG&E parent company Sempra Energy told state lawmakers about a conference call more than 10 years ago where then-CPUC President Michael Peevey agreed to sign off on the sale of a power plant in return for the utility purchasing power from a Calpine facility.
The California Senate Energy, Utilities and Communications Committee is holding a series of hearings to examine ex parte rules at the state's main energy regulatory body.

Dive Insight:

Since leaving office at the end of last year, former CPUC President Michael Peevey has been unreachable, according to the LA Times, as reports continue to grow about improper communications, ex parte violations and the cozy relationship between regulators and the utilities they oversaw.

The newspaper recounts testimony before a Senate committee looking into the CPUC's ex parte rules: Former Sempra attorney Kelly Foley told lawmakers about a 2003 conversation where Peevey said the utility would be allowed to sell a power plant in Escondido if it would purchase $700 million in power from a Calpine facility at Otay Mesa.

No ex parte paperwork was filed, though Foley reportedly told Senators that "Peevey ran the call." The deal was ultimately approved 3-2.

Earlier this year, state investigators searched Peevey's home, removing computers and other items related to an investigation of improper communications with Pacific Gas & Electric Co. The San Francisco Chronicle reported in January that, in addition to a controversy over PG&E lobbying for a favorable judge in its rate proceeding, there are also concerns that Peevey requested political contributions from the utilities.

Peevey announced last year that he would not seek reappointment to the commission when his term ended. He was replaced by Michael Picker, a CPUC commissioner and former energy advisor to Governor Jerry Brown.