San Bruno smells a rat at ‘corrupted’ CPUC

San Bruno officials called on Gov. Jerry Brown today to remove California Public Utilities Commission President Michael Peevey from office, alleging that recently disclosed emails show “illegal and illicit” private communications with PG&E.

The commission is conducting three proceedings investigating PG&E’s role in a 2010 natural-gas pipeline explosion that killed eight people and injured 66 others in San Francisco.

San Bruno officials say that emails released by the CPUC last week show at least 41 private emails between PG&E officials and Peevey related to regulatory matters, including a proposed fine for PG&E that could amount to more than $2 billion.

Mayor Jim Ruane said at a news conference Monday morning outside the CPUC’s headquarters in San Francisco that the emails:

“… revealed the extent of a relationship much deeper and more shocking than even we originally feared.”

Ruane alleged that the confidential emails:

“…demonstrate that the CPUC process is corrupted and that the agency has lost its ability to carry out its mandated regulatory functions as a watchdog for the public.”

Ruane’s letter to the governor asks Brown to remove Peevey from the CPUC presidency immediately and also to appoint an independent monitor to oversee relations between the agency and the utility.

San Bruno also filed two motions with the CPUC itself Monday. One asks to have Peevey removed from proceedings related to the San Bruno explosion. The other asks for sanctions against PG&E for violating a commission rule against private communications in regulatory proceedings.

Britt Strottman, a lawyer for the city, said those two motions will go before administrative law judges at the commission. After 60 days, she said, the city would have the right to file a lawsuit in Superior Court with the same claims.

The 7,000 pages of records and emails obtained by San Bruno also include emails between other CPUC officials and PG&E staff members.

State Sen. Jerry Hill, D-San Mateo, noted at today’s news conference that PG&E regulatory relations director Laura Doll answered one email from Peevey’s chief of staff with a message saying:

“Love you.”

Hill said:

“If that’s not a cozy relationship, I don’t know what is.”

The commission issued a statement saying:

“The CPUC takes seriously all allegations of bias and rule violations.”

CPUC officials said they will evaluate the city’s two motions and give all parties a chance to comment. PG&E released a letter sent today by utility President Chris Johns to Ruane and the CPUC’s five members.

Johns wrote:

“We are absolutely committed to conducting ourselves in an ethical manner at all times.”

Johns wrote that the utility will review the emails and “take appropriate action” if its standards were not met.