Tag Archives: utility regulation

AT&T, Comcast “continue to frustrate” CPUC inquiries “even on safety matters”

by Steve Blum • , , , ,

AT&T and Comcast blew off demands for information about broadband pricing from California Public Utilities Commission staff, so now the public advocates office, which requested the data, is asking the commission to force the companies to comply and to acknowledge their legal responsibility to fully answer questions about service, safety and other issues.

The PAO sent a detailed questionnaire to Internet service providers in California, including telephone companies and cable operators, during an ongoing inquiry into the affordability of broadband and other essential utility services in California. According to the “motion to compel responses to data requests” filed by the PAO, Charter Communications and Cox answered, but Comcast and AT&T lawyered up (the filing doesn’t mention Frontier Communications, the other member of California’s Big Five ISP club).

Although AT&T and Comcast provided some information (see below), the bulk of their responses boiled down to you people don’t have any jurisdiction over broadband, but if you’re really interested, check out our website.

The jurisdiction question was answered, if not completely settled, by a ruling from Clifford Rechtschaffen, the commissioner who is leading the inquiry. He took the uncommon step of issuing a ruling that asserted “a significant role for the commission” in managing California’s broadband ecosystem.

Besides being dismissive, answering a data request with a link to a sales-focused website isn’t enlightening and could be dangerous, according to the filing…

The presentation of pricing on the AT&T website does not provide all relevant combinations of service bundles and speeds. Websites also produce selective company information that are in no way responsive to the data requests or comparable to other communication companies’ information. For instance: What is the lowest price for the user-defined combination of services at the user-defined speed across all communication companies?…

Telecommunication companies continue to frustrate the Public Advocates Office’s efforts to understand their continually evolving operational landscape and how it affects California consumers, even on safety matters.

There’s no particular timeline for when – if – action will be taken on the PAO’s motion.

Comcast
Comcast pricing jan 2019

AT&T
Att broadband pricing 2019
Att legacy dsl pricing 2019

Political dreams, not business sense drive plan for public takeover of PG&E

by Steve Blum • , , , ,

Glinda the good witch

It’s not a co-op, despite being “customer owned”. It’s not a utility district or a municipal utility, despite operating “as though it were a public agency”. And it’s certainly not a profit making company. Which leaves wide open the question of what kind of organisational beast San Jose mayor Sam Liccardo and 113 other northern California elected officials think will take over Pacific Gas and Electric’s operations and assets.

The group released a set of “operating principles” for a new, quasi-public entity that would replace PG&E. Key details are missing, including where the money is coming from – bankruptcy judges aren’t in the habit of giving something away for free when others are willing to pay for it – and whether they want PG&E’s natural gas business too.

It’s an all things to all people proposition. Somehow, this new utility will have oversight responsibility for community choice aggregators, which are local governmental agencies – joint powers authorities – that buy electricity and manage customers, via PG&E, in some California cities and counties. But it will have “‘private’ entity legal status” as a “customer-owned utility”. Which makes it sound like a traditional electric cooperative, except that “excess revenues will be re-invested into the communities” it serves, and not rebated to the customers who own it, as co-ops do.

The group’s manifesto includes a long wish list of other goodies the new utility will bestow upon people and public agencies in PG&E’s service territory, such as prioritising capital investment to “prevent wildfires, reduce public safety power shutoff events, and improve overall system reliability”, and “maintaining and growing a skilled workforce” that will improve safety and reliability, as well as customer service. They seem think it’s possible to do all that, while improving “affordability” and offering “options to reduce costs for all ratepayers”.

That would be a neat trick. But it’s only possible to make those kinds of promises when the only cost involved is the price of a press release. Public ownership of monopoly utilities is worth considering, but it’ll only work if the owners – tax payers – are willing to back it financially and if the people running it focus on the tough business of delivering service.

Contract for the Web addresses virtues and vices of government intervention

by Steve Blum • , , , ,

Contract for the web

The “Contract for the Web” campaign published its manifesto last week, titled, naturally enough, Contract for the Web. It’s a declaration of nine principles, including “make the internet affordable and accessible to everyone”, “respect and protect people’s privacy and personal data to build online trust” and “develop technologies that support the best in humanity and challenge the worst”, which are among the tasks the contract assigns to private companies. Individuals are urged to “be creators and collaborators on the web”, “build strong communities that respect civil discourse and human dignity”, and “fight for the web”.

The Contract was written by a wide range of companies and organisations, ranging from Google to Change.org to the German government, and the effort is led by Sir Tim Berners-Lee, the inventor of the World Wide Web. Even so, it’s been criticised for having no teeth. The likes of Facebook, Twitter and Microsoft have signed on to it, there’s no guarantee that they’ll pay any attention to it.

True enough. There’s more to it, though.

The Contract opens with a clear call for government enforcement, and even intervention. The first three principles state that governments will…

  1. Ensure everyone can connect to the internet.
  2. Keep all of the internet available, all of the time.
  3. Respect and protect people’s fundamental online privacy and data rights.

Simply stating that a government – any government – should do something is of little consequence. But as governments adopt the Contract, in whole or in part, over time, it’ll grow teeth. And governments and subordinate agencies are doing that.

The details of the privacy principle track with the European Union’s general data protection regulation. Tasks to “ensure everyone can connect to the internet” include measures that local governments in California have already adopted, such as “dig once” policies and pole access agreements.

Regulatory agencies are in the game, too. For example, the Contract sets the goal that “1GB of mobile data costs no more than 2% of average monthly income by 2025”. The California Public Utilities Commission is considering affordability standards for broadband and other utilities that are heading in the same direction.

Government is far from being a universally benign force in the world, though, and the Contract recognises that fact too, for example calling for requirements that…

Government demands for access to private communications and data are necessary and proportionate to the aim pursued, lawful and subject to due process, comply with international human rights norms, and do not require service providers or data processors to weaken or undermine the security of their products and services.

That’s a message that the U.S. government needs to hear.

Video entertainment “should not be considered essential” says AT&T. Amen say Comcast, Charter

by Steve Blum • , , , ,

Darth leia 625

For a company that paid $85 billion to become a video entertainment giant, AT&T has an odd idea of what’s essential and what’s not. In objections to a California Public Utilities Commission staff proposal, AT&T argued that “video entertainment” should play no role in determining what level of broadband service is “essential” and whether it’s affordable or not. It specifically targeted Netflix and ESPN+ as examples of non-essential services that are not “appropriate essential functions” and should not be included in calculations of what level of broadband speeds and data caps are necessary for Californians to conduct their every day lives.

In reply comments, the lobbying front organisation that Comcast, Charter Communications and other cable companies use to push their interests in Sacramento and at the CPUC endorsed AT&T’s position, paraphrasing it as “entertainment service such as Netflix is not essential”. It’s easy for the California Cable and Telecommunications Association to trash talk Netflix; the Walt Disney Company – ESPN’s majority owner – not so much.

AT&T and its amen corner got it wrong, for at least a couple of reasons. First, the CPUC staff white paper in question identified fixed broadband service at 20 Mbps download and 3 Mbps upload speeds as the minimum necessary for a Californian household to meet its “basic needs” such as education, telehealth and safety, and enjoy “full participation in society” by doing such things as “completing job applications and accessing government assistance programs”. Netflix and ESPN aren’t on the list. Neither is HBO Max, which AT&T is hoping will pull it out of the video subscriber death spiral it’s in, or Spectrum TV Essentials or Xfinity Instant TV. Calling out entertainment services is a red herring.

It’s also arrogant.

I’ve sat in many meetings in Sacramento and listened to telco and cable lobbyists speak with contempt about people who are misguided enough to think they ought to be able to watch video via the Internet, if they don’t provide sufficient profit to be worth it to those companies to deliver modern broadband service. Full participation in society requires more than just getting email or reading a web page. It includes access to the full range of online information and social and political interaction that’s available – and essential – to those of us who are fortunate enough to have it.

Collected documents from the CPUC’s investigation into essential service and affordability metrics for utilities are here.

CPUC commissioner asserts “a significant role” over broadband affordability and essential service

by Steve Blum • , , , ,

Rechtschaffen 2 20may2019

In a ruling issued on Friday, CPUC commissioner Clifford Rechtschaffen ended any doubt over whether an inquiry into the affordability of utility services includes the cost and quality of broadband access: it does. The decision puts wind in the sails of an analysis of broadband pricing and service speeds prepared by California Public Utilities Commission staff, and meets strident objections from AT&T, Comcast, Charter Communications and other monopoly model incumbents head on…

This amended scoping memo confirms that communications services, such as broadband internet access, are included within the scope of this proceeding. This amended scoping memo finds that [California Public Utilities] Code Sections 709, 280, 281, 275.6, and the Moore Act all demonstrate that the Legislature contemplated a significant role for the Commission in closing the digital divide in California and bringing advanced communications services, including broadband internet access, to all Californians. This proceeding may assist in that goal.

The California Cable and Telecommunications Association, which is a Sacramento lobbying front organisation for Comcast, Charter and other cable companies, argued that the CPUC shouldn’t look into the affordability of broadband service because it is “an interstate service governed by federal law, and defined as an “information service” and not a “telecommunications service”. In reply comments, AT&T agreed, saying “broadband is not a public utility service”. A joint filing by small rural telephone companies said much the same thing.

Unfortunately for them, the primary legal basis for their objections – the Federal Communications Commission’s blanket preemption of state broadband regulations was overturned by a federal appeals court. So long as the FCC says that broadband is an information service, it can’t wield its telecommunications authority as a magic weed whacker to chop down state regulations.

In his ruling, Rechtschaffen also set next June as the deadline for CPUC action on affordability and service standards for broadband and other utilities, including electricity, water, gas and voice services.

Collected documents from the CPUC’s investigation into essential service and affordability metrics for utilities are here.

PG&E pole attachment shot clock ready for another CPUC vote

by Steve Blum • , , ,

Fiber attachments 625

The do-over of a settlement resolving a utility pole attachment dispute between Pacific Gas and Electric and Crown Castle is queued up at the California Public Utilities Commission. The original settlement was drafted by administrative law judge Patricia Miles and approved in March. But commissioners reversed the decision due to procedural mistakes, and told Miles to fix those errors try again. She did, and the new draft is the same as the old one.

If approved, the imposed settlement gives PG&E forty five days to “provide a response” to a pole attachment request from Crown Castle. If there’s no response, Crown Castle can go ahead with its proposed work. “Response” is not defined, but typically it means a yes or no answer, including any specs for work that’s needed to make the pole ready for a new line to be attached. Whether PG&E’s lawyers go with the typical meaning or try to craft one of their own remains to be seen.

The draft also bakes in the rejection of Crown Castle’s original request to be allowed to buy attachment space on PG&E’s poles, rather than just lease it. PG&E’s practice is to either sell ownership of the entire communications zone – the segment of the pole that’s high enough off the ground and sufficiently beneath electric lines – or lease it by the foot. Typically (there’s that word again) AT&T or another incumbent telco buy the entire zone and manage it under private joint pole rules that are, in theory, friendlier to telecoms companies. Crown Castle wanted those privileges for its one-foot of pole space, but didn’t want the responsibility of managing the entire zone.

PG&E opposes the changes proposed by Miles. It doesn’t like the way it was handled – the dispute between the companies was fast tracked as an arbitration, rather than a typical, and lengthy, litigation – and it objects to what it characterises as special treatment given to Crown Castle.

Crown Castle generally endorsed Miles’ decision, albeit after making clear that they think they should have been given the right to buy space by the foot on poles, and after asking for one change – removal of a requirement that they provide two days notice to PG&E before doing work on poles.

The commission is scheduled to vote on the proposed settlement at its meeting next week, but don’t be surprised if it gets bumped. PG&E and Crown Castle have one more round of comments to file, and if any of their arguments gain traction with Miles or commissioners, then new language would have to be drafted.

“Rate neutral framework”, whatever that is, promised as PG&E offers plan to pay wildfire costs and get out of bankruptcy

by Steve Blum • , , , ,

PG&E filed its plan for coming out of bankruptcy with the federal judge handling the case yesterday. The company proposes to give $8.4 billion to those harmed by wildfires over the past four years, both individual and public agencies, another $8.5 billion to insurance companies that have already paid out claims resulting from those fires, as well as a previously agreed $1 billion to a group of northern California public agencies.

In a press release, PG&E’s CEO, Bill Johnson, was quoted as saying the reorganisation plan is a “rate neutral framework”, but didn’t elaborate. Media outlets have interpreted it as meaning that wildfire settlement costs won’t be passed onto electric customers, but there’s potentially a lot of weasel in those few words. The press release also promised “participation in the state wildfire fund established by Assembly Bill 1054” and “satisfaction” of its requirements.

AB 1054 was passed by the legislature in July, and sets up a couple of funds – one paid for by utilities, the other directly by their customers – that will provide a way of financing wildfire liabilities for Southern California Edison and San Diego Gas and Electric, and for PG&E if it clears the bankruptcy process by next summer. Since the $2.50 monthly charge for the second fund is already tacked onto customers’ bills, keeping it presumably qualifies as “neutral”. There are other ways to pass on costs to customers, directly and indirectly, so don’t assume that northern California electricity costs won’t go up even further if the judge eventually accepts PG&E’s plan.

The proposal also says that PG&E will honor existing contracts with community choice aggregators, lean energy producers and employees, and pay back its debts to lenders.

Just ahead of the filing, the City and County of San Francisco sent PG&E a letter offering to buy its electric (but not gas) system for $2.5 billion. It’s a follow up to a municipal power plan floated earlier this year by San Francisco mayor London Breed. According to the San Francisco Chronicle, PG&E unsurprisingly responded that the offer wasn’t in “the best interests of our customers and stakeholders”.

High priced, low performing broadband service hits rural Californians hard

by Steve Blum • , , , ,

A California Public Utility Commission analysis of utility service affordability in California used household income, local cost of living and utility cost figures for far northern California – Siskiyou, Modoc and Lassen counties – to illustrate a proposed method for determining whether people can actually afford the utility service that they need. The example also illustrates a serious problem in rural California: the high cost and low quality of broadband service.

For the most part, the CPUC has no role in regulating, setting or monitoring the cost of broadband subscriptions, or the level of service provided. One exception comes when an Internet service provider asks for a grant from the California Advanced Services Fund (CASF), the state’s primary broadband infrastructure subsidy program. So the authors of the CPUC’s white paper looked at a grant given to the Siskiyou Telephone Company, an independent rural telco that serves customers in Siskiyou County.

The price that grant’s conditions allow for subsidised service that meets the 20 Mbps download/3 Mbps upload standard that the study identified as the “essential” minimum for 21st century households is $150 a month. For low income residents, that’s somewhere between 8% and 9% of remaining household income after housing costs are paid, and represent 12.5 hours of work at minimum wage.

That’s a significant burden, according to the study…

Even when receiving a CASF grant, the rates offered by this provider still make up a sizeable portion of the household’s utility budget. While these bills are not necessarily onerous for customers in the middle of the income distribution, customers at the 20th percentile spend around 3 times as much of their income after housing costs on telecommunications service.

In addition, contrary to other affordability studies allocating a minimal amount of expenses for telecommunications services, this analysis illustrates that telecommunications services are the highest utility expense incurred by a household in this [area].

That high cost, low performance paradox is common in rural California, particularly in areas that have to rely on wireless Internet service providers, who often charge even more than Siskiyou Telephone for service that’s even slower and less reliable.

Hancock, Ho, Sieren-Smith, Tome, Enriquez, Lai, Staff Proposal on Essential Service and Affordability Metrics, California Public Utilities Commission, 20 August 2019.

“Essential” broadband is fixed service at 20 Mbps down/3 Mbps up, CPUC white paper says

by Steve Blum • , , , ,

Forbes ag tech hartnell alisal demo 13jul2107

“Voice and broadband services required for education; telehealth; safety; and participation in society, such as completing job applications and accessing government assistance programs” will be defined as “essential services” in California if recommendations by California Public Utilities Commission staff are eventually adopted by commissioners.

According to a staff white paper on essential utility service affordability, for broadband service that means a minimum of 20 Mbps download and 3 Mbps upload speeds, with a monthly data cap of no less than 1 terabyte (1,024 gigabytes). That’s significantly more than the 6 Mbps down/1 Mbps up service level that the California legislature adopted as the state’s minimum broadband speed standard when it bowed to bags full of cash polite requests from AT&T, Comcast, Charter and other incumbent telecoms companies eager to protect their monopoly model businesses.

People need reliable broadband connectivity, according to the paper, and it needs to be fixed service; mobile broadband doesn’t cut it…

Fixed broadband is an essential service for Californians to be able to participate fully in society. For example, telehealth usage had a 1,202% growth between 2012 and 2017. In addition, the Federal Communications Commission (FCC) states that “[a]ccess to broadband has become essential for students in all levels of education.” Furthermore, staff finds that mobile broadband services are not a viable substitute for fixed broadband services due to cost, access, and capacity limitations of wireless technology. For example, schoolwork, job applications, and government services are functions that are difficult, if not impossible, to accomplish on mobile. In addition, mobile services provide lower speeds, lower data caps, higher latency and higher prices compared to wireline broadband.

To determine whether all Californians can afford that level of service, the paper looks at three potential metrics: 1. the total cost of essential water, energy and telecoms service divided by household income remaining after housing costs are paid, 2. the number of hours of minimum wage work needed to pay that cost, and 3. a statistically based index that measures ability to pay on the basis of economic vulnerability.

Although the paper looks at some examples (more on that later), it doesn’t try to define what an affordable monthly price for broadband service, or other utilities, would be. Instead, it proposes a methodology for calculating those figures and a framework for applying it.

It’ll ultimately be up to the five CPUC commissioners to decide whether or not to adopt it. They ought to. It’s an excellent piece of work.

A workshop is scheduled for next Monday in San Francisco to discuss the methods and data proposed by the white paper, then public comments will be accepted in September. You can bet that incumbent telephone and cable companies will offer vociferous opposition.

Hancock, Ho, Sieren-Smith, Tome, Enriquez, Lai, Staff Proposal on Essential Service and Affordability Metrics, California Public Utilities Commission, 20 August 2019.

CPUC orders a do-over on PG&E–Crown Castle pole dispute decision

by Steve Blum • , , ,

White road attachment

A California Public Utilities Commission decision giving Crown Castle the right to work on Pacific Gas and Electric Company’s utility poles without permission, including attaching cables if PG&E doesn’t respond to requests for permission within a set time limit, was reversed on Thursday. Commissioners voted unanimously to send it back to the administrative law judge (ALJ) that originally heard it.

That doesn’t mean the substance of the decision will change, though.

PG&E based its request for a do-over on procedural grounds, claiming the CPUC didn’t follow its own rules for posting a proposed decision and giving the public – including particularly PG&E – the right to offer comments before a vote. Commissioners agreed…

We find that we did not follow the public review and comment requirement on proposed decisions, set forth in [the California public utilities code] and our Rules of Practice and Procedure. We grant rehearing and refer the proceeding back to the [ALJ] in order to serve a new proposed decision on the parties and provide the required public review and comment period (or issue a ruling, if appropriate, reducing or waiving the comment period). PG&E may raise any relevant remaining legal issues in comments to the proposed decision.

The core of PG&E’s legal objections is that the ALJ’s arbitrated decision ignored decades of past commission decisions and ran contrary to established policy for fairly, and safely, regulating the relationship between electric companies that own utility poles and the telecoms companies that use them.

ALJ Patricia Miles isn’t obligated to make any changes to the decision itself, and there’s no reason to think she will. The likeliest next step is for her to repost it with any minor changes to dates and such that might be needed. Thirty days later, or when ever the next meeting after that is scheduled, commissioners can vote again. In between, PG&E will have a chance to ask for changes.