November 30, 2016

Amendment 1: The Big Utility Showdown


The largest utilities in Florida bankrolled Consumers for Smart Solar and Amendment 1. They want to maintain their monopoly control over energy in the State. Amendment 1 was looking to suppress competition from rooftop solar via constitutional ballot amendment. Thankfully, those in Sarasota and Manatee Counties as well as the rest of Florida saw through the ruse and voted it down on Election Day 2016. However, the story of Amendment 1 is a bit more complicated and Machiavellian, pitting the corporate and financial power of Big Utilities against the Power of the People.


As it stands now in Florida, only utilities can sell power to retail customers. Due to this restriction, landlords cannot sell power from solar panels to their tenants. It also effectively shuts down solar leasing. With leases, an outside company pays the high upfront cost of solar panels, and their customers sign long-term contracts to buy the power. Such leasing has made residential solar the fastest-growing part of the U.S. solar market. But it is simply not legal in Florida. Each utility has monopoly control of the sales and distribution of electricity. 

For many years, both citizens and politicians have wanted to open up the utility monopolies to competition from solar companies. The Florida Center for Investigative Reporting interviewed Paige Kreegel, who was a State Representative back in 2009. He was chair of the state House’s Committee on Energy. He considered himself a free-market Republican and he wanted to get government out of the way of the growing solar industry. But the rest of the Committee Members wouldn’t touch solar energy and he found himself an outsider on the Energy Committee he chaired. It turns out that Florida’s utility companies have heavily funded Florida political campaigns - to the tune of $12 million between 2010 and 2015. Those donations included contributions to every member of the Florida Senate and House leadership and a whopping $1.1 million to Governor Rick Scott's 2014 reelection campaign. According to State Sen. Jeff Brandes, “Here’s how the power companies control the Legislature: they ask the chairman of committees to never meet on the issue.”

To circumvent the lack of action in the Florida legislature, Floridians for Solar Choice attempted to place a constitutional amendment on the Florida ballot. They needed close to 700,000 petition signatures to get it on the ballot. With funding from the Southern Alliance for Clean Energy, Floridians for Solar Choice hired a petition gathering firm. They collected enough signatures to have the ballot wording reviewed by the Florida Supreme Court. That's when the monkey business started. Florida Attorney General, Pam Bondi, delayed sending the petition to the Florida Supreme Court for 30 days, the maximum allowed by law. This gave the Big Utilities time to ramp up their opposition briefs to fight the initiative in court.
Nonetheless, the wording of the Solar Choice initiative held up before the scrutiny of the Court. So the Big Utilities fired up a campaign of deception to confuse Florida voters about the initiative. The upshot was a competing amendment, the so-called Smart Solar amendment.

To explain the context for this competing initiative, Amendment 1, it might help to consider my roof. My roof is covered with solar panels. We have enough that we started producing slightly more electricity than we use. You may not be surprised to learn that FPL required us to maintain gobs of liability insurance, FPL required us to install specific disconnect options to assure the safety of their workers, and the City required a permit and follow-up inspection. But you may be surprised to learn that we still get an electric bill from Florida Power & Light (FPL). Every month for many months, we have been paying $9.42 to make use of the electrical grid, even though our net electricity use is less than zero. Monthly payments seem fair to me. We don't need a backup battery and FPL distributes our excess electricity to our next door neighbors, so FPL is providing a service. Is it a fair amount? I have no idea.

After hearing about my roof, it is immediately apparent that all of the so-called consumer protections provided by Amendment 1 are already in place in Florida. There is no need to clutter up Florida's constitution with language about allowing me to install solar equipment on my property. I can already do this. No need for the constitution to allow a charge for my use of the electric grid. FPL already charges me. No need for the constitution to require safe solar. FPL would not have allowed me to connect to the grid had I not followed their safety requirements. So why did the largest utility companies in Florida spend over $26 million on this amendment? The Amendment 1 provisions sounded pro-solar and pro-consumer, but in reality they were merely an attempt to protect the pro-monopoly status quo and bollocks up any future pro-solar attempts. There will be no rooftop solar revolution in Florida if the Big Utilities have anything to say about it.

It's going to be hard to follow the rest of the story because the protagonist, Floridians for Solar Choice, and the antagonist, Consumers for Smart Solar, sound like they are on the same side. Indeed, confusion and deception were an integral part of the utility-backed Smart Solar strategy. A leaked audio from Sal Nuzzo of the James Madison Institute speaking at the State Energy/Environment Leadership Summit spilled the beans about their strategy. He said that utilities created Amendment 1 as an act of “political jiu-jitsu” to “negate” the efforts of solar advocates.

At this point in the tale (2015), both the Solar Choice folks and the utility-backed Smart Solar folks were out collecting petitions. They had hired different firms to help gather signatures, but these firms had hired some of the same people to do the gathering. So one person was potentially gathering signatures for both petitions. And here's the kicker. When Solar Choice paid $1/signature, utility-backed Smart Solar paid $2. Then when Solar Choice upped their payments to $2/signature, utility-backed Smart Solar upped theirs to $4. If you were out collecting signatures, which one would you ask people to sign first - the one that pays $2 or the one that pays $4. And in fact, that's exactly what folks on the street reported. On October 24, 2015, the Gainesville Sun published a letter from Greg Fussell,
"Recently as I was leaving the University of Florida’s Health Science Center, a young man asked me to sign a petition for solar power. As I’m reading through the petition, I recognized that it’s the Consumers for Smart Solar (CSS), a utility-sponsored petition, and not the Floridians for Smart Choice (FSC), which I prefer. 
When I said I won’t sign it, it’s not my preference, he handed me the FSC petition. Now, I’ve never had that happen where one person had competing petitions. Consequently, I was compelled to ask why he handed me the CSS version first and not the FSC version. Wait for it — He said, “I get paid more for the CSS version.” 
I was disappointed to see how this played out, and as I watched, most that signed the petition signed the CSS utility-sponsored petition. I’m convinced it was because it was handed to them first." 

Julie Delegal in Jacksonville reported asking a "signature-collector straight up whether he was representing the utilities-backed amendment, he told me his was the one I wanted to sign, and emphasized the 'pro-consumer' aspects of the amendment. I didn’t sign, and I tore up my husband’s signature form before he could finish it."

Despite the reported confusion between the two amendments, the Florida Supreme Court went ahead and permitted the wording of the utility-backed Smart Solar amendment. This was a dismal failure on the part of the Court. Their job is to ensure that such ballot amendments are not ambiguous. Justice Barbara Pariente, wrote in her dissent, "Let the pro-solar energy consumers beware."

If two competing amendments appeared on voter ballots and they both looked pro-solar, the voters might be fooled into voting yes for both. But such a ballot was not meant to be. As of December 2015, the signature gathering company, PCI, was withholding 212,000 signed petitions. It was awaiting payment of expenses that the Solar Choice folks claimed were above what they had agreed to pay. Instead of getting signatures, the Solar Choice folks filed a lawsuit. And they missed the petition deadline for 2016. Floridians for Solar Choice would be aiming for the 2018 ballot. Meanwhile in November 2016, there would only be one amendment on the ballot - the utility backed Smart Solar amendment, now known as Amendment 1.

To make matters more confusing there was another pro-solar amendment on the August 2016 primary ballot. Amendment 4 allowed businesses the same property tax exemption for solar equipment, currently enjoyed by individuals. Most of us in Sarasota and Manatee Counties and across Florida support solar power and believe Florida, with its abundant sunshine, should be leading the way. Most of us would want to vote Yes on 4 in August and No on 1 in November. But that doesn't make for a memorable campaign slogan.

While Florida's pro-solar advocates were waiting for the August primary to wrap up, the utility-backed Smart Solar folks were racking up endorsements, but not in the traditional manner. According to the Energy and Policy Institute, the Big Utilities filtered money through non-profits in an attempt to make it appear like they had broad support. Five such groups are Let’s Preserve the American Dream, the 60 Plus Association, Partnership for Affordable Clean Energy, the National Black Chamber of Commerce, and the Florida State Hispanic Chamber of Commerce. The following chart, accurate as of October 28, shows the amounts flowing directly from the Big Utilities and indirectly, through their non-profit donation-intermediaries.

From an Energy and Policy Institute article


After Amendment 4 passed in August, a coalition of pro-solar activists rolled up their sleeves to defeat utility-backed Amendment 1. Local environmental groups headed by the Sierra Club banded together with solar contractors and Tea Party conservatives to educate the citizenry. In Sarasota, the call went out to hit popular venues, such as farmer's markets, with No-On-1 informational pamphlets. Twenty seven newspaper editorial boards came out in opposition to Amendment 1. Republican, Democrat, Libertarian, and Green Party groups came out against. When Early Voting started, Amendment 1 opponents talked to voters and handed out pamphlets at voting sites. And those red No-On-1 signs popped up all over town in very prominent spots. Such grassroots action took place in Sarasota and other hotspots across the state.

Meanwhile, Florida's Big Utilities were worried. They donated additional millions to the campaign in order to run more television ads and send more slick mailers. On October 10th, the Florida Professional Firefighters endorsed the utility-backed Amendment 1. There was no vote by the affiliated firefighter membership; just an endorsement. Smart Solar went into overdrive featuring firefighters in hundreds of television ads implying that rooftop solar panels could be a fire hazard.

The firefighter's endorsement must have been a backroom deal at the leadership level, because rank and file firefighters opposed the amendment. On November 4, the Florida Professional Firefighters reversed their endorsement. They said they had

"communicated with hundreds, if not thousands, of firefighters over the last few weeks regarding their concerns with Amendment 1 and the real firefighter safety issues related to solar energy systems. It is clear to the elected Executive Board of this organization that our membership would prefer to pursue any future firefighter safety regulations related to the still developing alternative energy industry through legislative or rulemaking action, as opposed to a constitutional amendment that many believe to be misleading. We have requested that Consumers for Smart Solar stop broadcasting advertisements featuring firefighters and/or the logo of the Florida Professional Firefighters." 
Bravo for the Union. Unfortunately the ads kept running.

Election Day served a sweet victory to those opposing Amendment 1. Anti-solar wording will not be inserted into the Florida Constitution (yet). Grassroots efforts won the day.  But given the level of political involvement by Big Utilities, we may be confronted with a similar proposal down the road. 

Let's review that involvement. By October 28th, the Big Utilities had donated over $26 million to the Consumers for Smart Solar campaign. There are a few additional things that gall me about this. They call themselves Consumers for Smart Solar. Here's a question. How many of their donors were actually consumers? Twelve. Those 12 consumers donated a total of $305. But even that is overblown, since 11 of those 12 consumers worked for or lived with consultants of Consumers for Smart Solar. That leaves one lone consumer. How much did that consumer donate? Ten dollars. Evidently as of October 28, of the $26,118,915, only $10 was collected from an actual unaffiliated consumer.

The second galling item revolves around the non-consumer donors to the campaign - the Big Utilities. In Florida, they are monopoly utilities. That is to say, I can't go pick a different electric company; I must buy from the one in my area. If I don't like the political activity of my electric company, I am not free to choose another one. They can charge me to build a nuclear power plant and then not build it. Duke Energy did this with their Levy County plant. Duke Energy's Florida ratepayers had no recourse; they had to stay with Duke Energy. That means that Florida utility ratepayers are footing the bill for this campaign. FPL claims that it is shareholders who pay these costs, but if I were a shareholder that wouldn't sit well with me. And even so, where do shareholders derive such funds? Why from the ratepayers of course. Accounting sleight of hand might show that ratepayers did not fund this campaign, but that is mere chicanery.

Just to add a little jalapeno pepper juice to the wound, yesterday the Florida Public Service Commission (PSC) approved a rate increase requested by my electric company, FPL, to the tune of $811 million. In my ideal world, the PSC would have rejected the rate hike and told FPL to start planning for backup electric generation for the day when 75% of our electricity comes from renewable sources. They certainly have a lot to do and, in my ideal world, none of it would be political. But back to reality. After directly spending $8 million on the failed anti-solar Amendment 1, they are now raising rates. And without responding to any of the issues raised by opponents, the PSC approved the rate hike unanimously. That is probably no coincidence. All of the members of the PSC were either appointed or reappointed by Governor Scott. And remember, Florida's Big Utilities donated $1.1 million to Governor Scott's most recent reelection campaign.

There were some beautiful moments in this campaign. A highlight was the grassroots effort that eventually took down Amendment 1, despite its massive funding. But this type of effort takes us away from the positive work many of us want to be doing. Given the size of Big Utilities and the Big Money they are willing to distribute to every nook and cranny of our political system, everyday people's concerns do not stand a chance. When people talk about wanting to get money out of our elections, Amendment 1 would serve as a prime example why. But campaign finance reform only goes so far. Florida's Big Utilities have permeated the Governor's office, the Public Service Commission, the Florida Legislature, non-profits that sound like they represent racial minorities and seniors, and perhaps even the Firefighter's Union Leadership. They maneuvered around the Florida Supreme Court and ran television ads that shamelessly disregarded the truth about rooftop solar safety. Should they even be allowed to put a self-serving initiative on my ballot? Should they be allowed to charge me for such a campaign? Should they be allowed to work against sound environmental policies, by opposing solar energy and going against the wishes of the vast majority of Floridians? Citizens and legislators need to have the ability to take corporate power down a notch, if they see fit.

The story of Amendment 1 is just one data point. There are thousands of others. They all point to the difficulty we have maintaining our democracy, when corporations are persons, entitled by the U.S. Constitution to buy elections and run our government. Due to several U.S. Supreme Court rulings over the last 130 years, our democracy is under siege. We need a constitutional amendment explicitly stating that money is not speech and that corporations and other artificial entities do not have constitutional rights.

5 comments:

  1. As usual, an excellent, well-researched article on an important topic. Thank-you!

    While it's true that we have no choice but to purchase our power from FPL, you can use renewable energy certificates to, in effect, buy power generated from renewable resources. Information is available at this page at the EPA: https://www.epa.gov/greenpower/renewable-energy-certificates-recs (better read it before Inauguration Day). Arcadia Power is one provider of REC's, and is "partnered" with some organizations such as the Sierra Club and the League of Conservation Voters.

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  2. This comment has been removed by a blog administrator.

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  3. Well stated. Thanks for your support, it's efforts such as your own that helped defeat Amendment 1 while helping educate Floridians on solar.

    --bay area solar solutions

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