Take Back the Grid: DSA and the Fight for Energy Democracy

Last September, over-pressurization of natural gas lines owned by Columbia Gas resulted in a series of explosions in 40 homes in the Massachusetts towns of Lawrence, Andover and North Andover. In November, faulty transmission infrastructure owned by Pacific Gas & Electric (PG&E) sparked the Camp Fire, the deadliest and most destructive fire in California’s history, which caused $12.5 billion in covered losses. In December, a Con Edison transformer lit up the sky in Queens; it disrupted LaGuardia airport and local subway service and convinced some residents that an alien invasion was underway. And in January of this year, an equipment malfunction resulted in an explosion at a Consumers Energy natural gas station leaving residents of Northville and St. Claire, Michigan without heat.

The common thread between all these seemingly isolated events is the willful negligence of utility companies towards our lives and our environment. Utility companies around the country can operate with impunity because government agencies do little to hold them accountable when things go wrong. The complexity of energy production can be off-putting to consumers and laypeople, and the legal and technical jargon surrounding energy politics requires extensive demystification by experts. This alienation allows utility companies to burden their ratepayers with the cost of maintaining and upgrading the infrastructure through recurrent rate hikes; few ratepayers are aware that these companies make their profits on the distribution side and not the power generation side. It also removes the politics of energy production from the public sphere, restricting it to the world of government bureaucrats and energy company lobbyists. Consequently, these corporations keep profiting while endangering our lives and habitats.

But the tide is changing. Following the lead of Providence DSA’s #NationalizeGrid campaign, several DSA chapters have geared up to take on utility companies in their states. Across the country, DSA members are coming together to organize ratepayers, educate themselves and the public about the profiteering tactics of these corporations, and move a step closer towards the ultimate goal of democratizing, decommodifying, decarbonizing and decolonizing our energy sources. The following is a brief overview of the main energy democracy campaigns that DSA chapters are organizing around.

Providence

Providence DSA’s #NationalizeGrid campaign came out of their internal process for selecting one project that their relatively small chapter could devote all its resources to. They realized that organizing against National Grid, a monopoly utility company that regularly used shutoffs and rate hikes that disproportionately affected marginalized communities tied together environmental justice, welfare reform, climate change, public ownership, poverty and capitalism. With their coalition partner the George Wiley Center, a local welfare rights and poor people’s organization, they began organizing in the summer of 2017 against National Grid’s proposed $71 million rate increase to ostensibly create a greener utility grid and build a liquefied natural gas (LNG) facility in South Providence. Since then, they were successful in agitating the public against National Grid, won the attention of state officials, and were able to win significant rate reductions for low-income ratepayers. The chapter continues to agitate publicly against National Grid. This has included actions at the famous Waterfire festival in Providence, the re-introduction of Percentage Income Payment Plan (PIPP) legislation in the Rhode Island General Assembly, and an attempt to start another state investigation into National Grid’s business practice of undermining safety standards.

Boston

Following in the footsteps of Providence DSA’s campaign, the Boston DSA ecosocialism working group started researching utility business practices in Massachusetts in the fall of 2018. This activity began during a National Grid lockout of two United Steelworkers (USW) union locals during contract negotiations. Right after the Columbia Gas explosions, non-union workers contracted by National Grid  almost caused another explosion in Woburn by over-pressurizing a gas line. Boston DSA members organized around pressuring the legislature to push bills through that would extend unemployment and health benefits to locked out USW workers at National Grid’s expense, and attending union rallies, lobby days and state hearings to end the lockout. In this backdrop, Boston DSA selected the energy democracy campaign, #TakeBackTheGrid, as one of the two external priorities for the chapter last December.

The lockout ended after Governor Charlie Baker signed the bill to force National Grid to extend health benefits to locked out workers in December. Currently, Boston DSA members are working with local environment justice groups such as Green Roots to oppose any new fossil fuel infrastructure, educate members on energy politics, and bird-dog the Department of Public Utilities (DPU, similar to PUC) to protest any new rate hikes as they gear up to kick off their campaign to bring the utility grid under public ownership.

New York City

Consolidated Edison (ConEd) is the major utility company in New York City. To take down this fossil fuel powered monolith and introduce democratically controlled utility grids powered by renewables, NYC-DSA ecosocialists are currently organizing against Con Ed’s proposed rate hikes by canvassing ratepayers from high-risk neighborhoods to attend Public Service Commission (PSC, analogous to PUC) hearings, working with frontline communities and grassroots environmental justice groups, and focusing on political education on energy democracy both in and outside the chapter. For example, NYC-DSA ecosocialists are collaborating with UPROSE, a community organization focused on building a 100% solar-powered microgrid, and the Public Utility Law Project (PULP) to power map neighborhoods most affected by utility shutoffs. More recently, NYC-DSA comrades hosted a rate case training workshop in partnership with PULP to better inform their tenant/rate-payer canvassing program as part of their campaign.

New York already has publicly-owned utility companies, such as New York Power Authority (NYPA) and Long Island Power Authority (LIPA), but neither of those are democratically controlled. NYPA is also currently prohibited from owning new generation and transmission plants or extending its current customer base. The ultimate goal would be to bring these utilities under actual democratic control and to establish municipally owned grids powered by renewable energy such as wind, which would be constructed and maintained by unionized workers and not large corporations such as Orsted.

Chicago

Chicago’s contract with the main utility company, Commonwealth Edison (ComEd, parent company Exelon), will expire in 2020. The Chicago DSA environmental justice working group wants to use this opportunity to ideally bring ComEd under municipal control, or at least enact progressive utility rates, end shutoffs, and exercise more power to get energy from renewable sources. The last strategy is very similar to community choice aggregation, which allows ratepayers within a jurisdiction to aggregate their buying power to form an alternative to investor-owned utility and choose the source of power generation. To that end, Chicago DSA plans to collaborate with members of the International Brotherhood of Electrical Workers (IBEW) Local 15, whose contract with ComEd also expires in 2020. Since the last contract had a lackluster 2.5 percent annual wage increase, this provides a good opportunity to agitate members of the IBEW local and persuade them to join the campaign. Chicago DSA comrades hosted a “Energy 101” political education event last Fall and plan to hold “shut-off” clinics and other political education events in the neighborhoods to educate ratepayers and demystify the utility sector in the next few months. They also plan to collaborate with community-based environmental justice groups such as LVEJO, People for Community Recovery, and Neighbors for Environmental Justice who work on local issues such as diesel trucks,  landfills and environmental remediation. Illinois grants municipalities the right to convert their private utilities to public ownership, so a legislative push is also essential to this campaign.

There are currently five DSA-endorsed candidates running for the Chicago city council; of those, four are Chicago DSA members. The chapter’s environmental justice working group is working with fellow members to incorporate energy democracy campaigns into the candidates’ campaign platforms. Chicago DSA members believe that the efforts to bring ComEd under municipal control would also engage DSA more actively with the working class and connect the pocketbook issue of electricity bills to the larger climate crisis we are facing.

East Bay, San Francisco, and Northern California

As the Camp Fire ravaged Northern California, San Franciscans faced an air quality crisis. San Francisco DSA (DSA SF) quickly mobilized into action and distributed more N95 masks to those in need than the city did. In the aftermath of the fire, DSA SF and East Bay DSA (EBDSA) members, along with other environmental justice groups, protested at California PUC (CPUC) hearings on the company’s negligence. PG&E has filed for Chapter 11 bankruptcy, but legislators are wary of a bailout because of strong public sentiment against it. The EBDSA climate and environmental justice caucus has passed a resolution to bring PG&E under public ownership without bailing out the company and has reached out to seven other DSA chapters across northern California. EBDSA members are also partnering with community organizations such as Diablo Rising Tide and Communities for a Better Environment, as well as the national Sunrise Movement to formulate an energy democracy campaign that would tie into a Green New Deal.

All the local DSA campaigns are grounded in an understanding of the need to connect the seemingly technical issue of utilities management to the impending climate crisis, and of the fact that corporations will not be the ones to end our fossil fuel addiction. If we are to prevent global temperatures from rising above 1.5C we must act now, and this action must be built from the bottom up in collaboration with those who are affected the most by climate change. The politics of energy, and the environmental movement in general, has long ignored the needs of indigenous people and frontline communities. Therefore, it is imperative for us to also decolonize our campaign as we advocate for democratic control, decarbonization and decommodification of energy. The power to decide how energy is produced and distributed is central to how power is exercised in society. That is why socialists need to fight to take back the grid from undemocratic and unaccountable energy companies and push for state regulatory agencies to uphold public interests.

PG&E and #NationalizeGrid: A Closer Look

Most of the energy democracy campaigns are still in their nascent stages and place public ownership as a long-term goal. However, there is a very real chance that the public outcry against the PG&E bailout can be leveraged to turn it into a publicly owned utility. Given that Providence DSA’s #NationalizeGrid campaign has been the longest running one, it provides valuable lessons that should be incorporated into the fight to democratize PG&E. To that end, a deeper analysis of #NationalizeGrid and PG&E’s current situation is presented below.

The Fight to #NationalizeGrid in Rhode Island

When it adopted the campaign to bring the utility infrastructure of Rhode Island’s monopoly private utility, National Grid, under public and democratic ownership, Providence DSA jumped headlong into unfamiliar waters. None of the chapter’s members had much, if any, experience with utilities or energy justice issues and were convinced more by the possibilities for gaining new skills and experiences than anything else. But the chapter was up for the challenge of starting something from scratch and building something new together. Over the course of the last 18 months, Providence DSA has experienced notable successes, painful mistakes, and many lessons. Here are the main takeaways for any other DSA chapter considering a similar campaign in their area.

Look for a partner with experience: Not every chapter will have access to a coalition partner like the George Wiley Center. But at the start of the campaign, the chapter’s greatest asset was a willing coalition partner with a wealth of experience and knowledge on the issue. Bearing the name of a Rhode Island native and founder of the National Welfare Rights Organization, the George Wiley Center has been working on utilities justice issues since the 1980s. They organize primarily by acting as advocates for those affected by utility shutoffs or are stuck in a cycle of utility bill debt. This means helping guide them in interactions with National Grid (sometimes even arguing on their behalf), presenting motions before the state’s PUC to strengthen protections and assistance for low-income utility customers, and staging direct actions against National Grid and the PUC. Their knowledge of the regulatory and political structures and their experiences dealing with National Grid, the PUC, and those so negatively affected by the unjust utility system proved to be a great help in kick starting the campaign, especially in constructing an initial power map.

Build an internal knowledge base: Despite welcome assistance from coalition partners, the chapter recognized a clear need to build an internal knowledge base. A research team of around 15-20 members familiarized themselves with National Grid’s operations,  how the regulatory structure operates, utility customers’ rights and protections, and what existing or proposed alternatives looked like. This creation and dissemination of internal knowledge was of utmost importance, not only so members could become more knowledgeable about the issues, but to dispel the myths about the complexity of utility and energy issues. The ability to distill important information and disseminating it to the broader chapter membership and the public was a crucial first step for the campaign.

It was a bittersweet coincidence that as this research team was getting off the ground, National Grid announced plans for a sizeable rate increase and grid modernization plan. This gave the research team a mass of filings to learn about the company from. Dealing with over a thousand pages’ worth of filings was intimidating, but members quickly discovered that beyond the intentional obfuscation of the corporate techno-babble, the core issues and dynamics at play were easy to grasp. Through collective research and discussion, research team members gained important skills and gave the broader membership much needed knowledge which helped clarify the campaign’s path forward. Exploring National Grid’s filings convinced members of the necessity of public ownership. They were disgusted by the market mechanisms the PUC uses to induce National Grid to adopt “good behavior,” outcomes which could be achieved much more efficiently through public, democratic control of the utility. Collective research of these filings allowed the chapter to quickly develop an analysis that would guide the campaign, including the politicization of PUC proceedings.

Politicize depoliticized agencies: A series of PUC meetings and public comment hearings gave us a prime opportunity to spread our message against the rate hike and for socialization of the utility system. Rhode Island’s PUC was long used to operating as a depoliticized bureaucratic agency. The George Wiley Center regularly brought the stories of those most affected by National Grid’s policies to PUC meetings, but the regulators were not used to people challenging them to justify private ownership of the utility itself. The question of how hostile and disruptive the campaign’s posture toward the PUC would be was an important one. Members were firm but fair in their pronouncements, making it clear what they wanted while refraining from rapid escalation from the start. Even so, strong denunciations of the status quo and arguments for a socialist alternative were more effective than originally anticipated.

It’s important to gauge what kind of bureaucrats any regulatory body is staffed with: those who are committed ideologues, those with a past connection to the companies or area they regulate, or ineffectual do-gooders from the NGO sphere. The Rhode Island PUC contained more of the latter. It turned out to be more responsive to light pressure and more threatened by potential public outrage than originally anticipated. By the end of the process in August of 2018, National Grid cut its rate increase by 75% and increased its low-income discount from 15% to 25-30%. Though this was far from the ultimate of utility socialization, it was a very good result for a first fight, and showed members they weren’t up against an immovable bureaucracy completely controlled by the industry it is meant to regulate.

Regulatory agencies are a strange beast. Their members can be even more inflexible than elected officials, or they can be good-natured reformers who are afraid to exercise their power and need a bit of a push. It’s important to expose them to direct pressure from the communities they supposedly serve and see how they respond, and act accordingly.

Use the flexibility of utilities justice messaging: This campaign wasn’t just about bringing the message to those in power; it was also about taking the message to the public. Throughout 2018, Providence DSAers tabled at a wide variety of events around the city, talking with hundreds of Rhode Islanders about how much they hated National Grid and what an alternative could look like. Early on, members learned that hatred of one’s local utility company is a pretty universal feeling. Everyone had some negative story about National Grid, and dissatisfaction was widespread. Of course, the biggest challenge was getting people to believe that something could be done about it. But the other big lesson was how well “utilities justice” language worked to tie together so many different struggles. A conversation about utilities justice isn’t just about “typical” environmental themes of decarbonization and sustainability, it’s also about issues of poverty and racism, housing and transport, public ownership and workplace democracy.

This is but a short list of the many things Providence DSA learned from its campaign. Utilities justice campaigns bring the urgency of the climate crisis to the local level. They capitalize on the universal dissatisfaction with private utilities and their greed by allowing us to talk to people about big issues and brighter tomorrows. They can fit perfectly into a national fight for something like a Green New Deal by pointing people towards a tangible enemy living in their own backyard. And the hope and belief inspired by small-scale or short-term wins help push back against the climate nihilism that arises from frustration with the slow pace of national action.

The Fight for Public Utilities in Northern California   

All California DSA members want PG&E to be converted to a public utility.  Just saying that is easy, of course. The process of actually doing so will take a huge amount of thinking, strategizing, and fighting. We do not want a utility which requires continuous government subsidies, operates the same way PG&E does now, and regularly raises rates on the ratepayers. The fundamental question is how can PG&E be converted to a public utility in a way that achieves the “Four Ds”: decommodification, democratization, decarbonization, and demonstration?

Is taking PG&E public possible right now?  PG&E is currently in Chapter 11 bankruptcy. It faces $30 billion in liabilities from wildfires in 2017 and 2018 and has a net worth of approximately $22 billion. With the high likelihood of more wildfires in the coming years, it will be necessary to make centralized power delivery safer by placing utility wires underground in the state’s backcountry and better protecting transformers. Given these daunting issues, the CPUC, California’s utility regulator, has announced it will consider converting PG&E to a publicly-owned utility. As a result of PG&E’s dire financial situation, the state could buy PG&E for almost nothing. The ratepayers and the state are going to be on the hook for PG&E’s liabilities anyway with the company in bankruptcy. If Californians are going to have to socialize the costs of the fires, they should also socialize the benefits: the roughly $2 billion a year that PG&E makes in profit. The state may also be the only entity which can guarantee that PG&E’s union workers can keep their jobs, benefits, and pensions.  

For public ownership to succeed, however, something must be done about bankruptcy proceedings.  The bankruptcy court could potentially break up PG&E or agree to the company being sold to another corporation.  However, the CPUC will have to approve any deal for PG&E to emerge from bankruptcy, and the California legislature can mandate that the CPUC “consider ratepayers, workers, and fire victims” in any settlement which might mean the only viable solution is for PG&E to go public.  Since California’s new Governor, Democrat Gavin Newsom, appoints the CPUC commissioners, he will have a significant role in determining the bankruptcy resolution. Governor Newsom is very aware that the state’s voters are in no mood to bail out PG&E. His position might be threatened if he acquiesced to PG&E’s investors. Gray Davis, a previous Democratic governor, was recalled in 2001 when PG&E declared bankruptcy as a result of the ENRON scandal.  

What options should DSA consider in a public takeover of PG&E? One option is to advocate for state legislation to implement a public take over. After the last two disastrous fire seasons, many politicians fear doing PG&E’s bidding and a push to take the company public might work. However, in 2018 the California legislature passed a bill that let PG&E pass the cost of settling the 2017 fire lawsuits on to the ratepayers. Getting the legislature to take PG&E public would also require the support of Governor Newsom.  As mayor of San Francisco from 2004 to 2011, Newsom worked closely with PG&E and opposed efforts to create a city municipal utility. In the past year, PG&E contributed to Newsom’s gubernatorial campaign. And yet, Newsom is loath to be a patron of PG&E and would love to be seen as a champion of the voters. Thus, the legislative approach is possible but difficult and unlikely to end in legislation that would meet all the four Ds.

A second option is to create a public power four Ds initiative and put it on California ballot. This option avoids the many pitfalls of the state legislature but has several problems of its own. It would take a major grassroots effort to get such a proposition on the ballot, and there would not be a vote until at least March 2020. In the meantime, either the bankruptcy court or the state legislature could circumvent the proposition and make it irrelevant. Finally, it is very likely that there would be major opposition from PG&E investors and other corporate interests opposed to a socialist solution.

Finally, PG&E’s unions could buy out the company. There are, however, two main problems with this option. First, it would be difficult for the unions to secure sufficient funding to purchase the purchase the company, improve its safety protocols, and settle the many lawsuits aimed at PG&E. Second, the unions will resist to any plan to dismantle the current centralized power distribution system.

A ballot measure seems like the best option for winning the four Ds. But further discussion within DSA and the coalition for public power about the correct strategy for a very fluid situation needs to occur before any strategy is adopted.

What kind of management structure should DSA advocate?  At a minimum, the public utility must democratize decision making by putting workers on the top management team. There is nothing revolutionary about this measure. Many European corporations have worker representatives on their boards of directors.  There are at least two options of selecting worker representatives. The unions could appoint representatives, or the workers could directly elect their representatives. The direct election approach is more democratic, but it could alienate the unions and there is no guarantee the workers will elect better representatives than the unions would appoint.  More discussion on these alternatives needs to take place.

A more radical option would be to advocate complete worker control of the public utility rather than just having worker representatives on the board. Rather than letting the governor select some if not most of the public utility management, have the workers manage the utility. Given that the state of California will most likely be funding the takeover, this option would certainly be difficult to get the state to agree to. It would also require buy-in from the unions. Although this option would be difficult to get off the ground, it should be looked at closely.

How to deal with the looming collapse of centralized power distribution in California? Even if PG&E was well run, it would still be in financial trouble because of three interrelated factors: the cost future fires, which is estimated at $150 billion over the next decade; the rapid expansion of rooftop solar power, which is currently 25% of total power generation and rapidly climbing; and the rapid decrease in the price of residential batteries. It is estimated that storage system prices will decline at an annual rate of 8% through 2022. From 2015, battery prices have fallen by as much as 32%.  It is predicted that battery storage installations will grow six-fold between 2017 and 2022.

These factors will make Northern California’s centralized power system increasingly precarious over the next decade. As rooftop solar proliferates, PG&E’s electricity revenues are falling. Further, beginning in 2020 California will require all new homes to have solar power panels. The combined impact of these trends threaten to plunge PG&E’s centralized distribution system into a death spiral. Revenues are dropping as more and more homes and businesses produce their own power, while costs continue to increase. Higher electrical rates will in turn encourage more ratepayers to move away from PG&E as their source of power.

In response to this long-term trend, a new public utility will need to promote urban micro-power grids which do not need a massive power distribution network. In addition, it may be necessary to subsidize rooftop solar installations for low-income households. These initiatives will allow the large centralized power generators (both natural gas and hydroelectric) to be closed, as well as the gradual dismantling of the centralized power grid.

Decarbonization of the power system could make much of the 23,000 person PG&E workforce, most of whom maintain the centralized power grid, redundant. Therefore, a plan to transfer the current work force to other tasks needs to be developed. This plan will certainly include construction and maintenance of the new solar rooftop power system, but other alternatives for new employment urgently need to be researched.

Toward an Ecosocialist Future

If humanity is to effectively face the challenge of keeping climate change below 1.5 degrees Celsius, we need a vision for an ecosocialist future. This vision cannot be primitivist, and it must incorporate the reality that in the modern world, energy should be a human right, not a commodity. In order to achieve that vision and materialize it, we need to fight for public ownership of power generation and distribution. Centralized grids for distribution and energy generation, market monopoly by profiteering companies, neoliberal policies and government collusion with private utility companies – these are hallmarks of the capitalist decay that afflicts our society. All must be abolished. A fight for energy democracy is not only about control of power generation and distribution. It is also about fighting poverty, racism, imperialism and all other oppressions that uphold the capitalist state. Above all, it is a fight for our survival and for the generations who will follow us.