The utility sector is undoubtedly growing at an unprecedented rate, but many leaders find themselves wringing their hands that the amount of new workforce coming in may not be keeping pace with what’s needed. Just as critically, though, it’s when the retirement of lifelong utility professionals take out of the equation their institutional knowledge and deep, unparalleled expertise that these leaders have even more reason to worry.
Making sure the dreaded loss of expertise does not become insurmountable, the Energy Central Network of Experts always seeks to add to the ranks these long-time experts who have seen the transformation of the power sector from the inside and can share their key lessons learned with the wider community. The latest member of the experts in our Transmission Professionals group can do just that: Peter Allen.
Peter spent 22 years at the California Public Utilities Commission before retiring at the end of 2022. Before that, Peter’s career saw him navigating various different aspects of the sector across transmission and utility regulation, all of which he touches upon below in his New Expert Member Interview. Keep reading to learn about Peter’s experience and then in the comments below welcome him as our latest official Energy Central Expert!
Matt Chester: Thanks for agreeing to be one of our experts, Peter. Can you give your background in the industry so our community better understands what went into you being established as an expert?
Peter Allen: I'm an attorney, graduated from law school in 1989. I started out working for a firm that did securities class actions, so I learned about securitizing bad debt in the wake of the savings loan crisis. In 1991, I started representing the city of San Diego in utility proceedings before the California Public Utilities Commission. They had a longtime attorney doing that work who wasretiring, and this was before energy was cool, so no one else really wanted the job. So I became the city of San Diego's CPUC attorney and started litigating cases on behalf of the residents of San Diego and the city itself in front of the CPUC, doing both energy and telecommunications.
In 1992, I went to work for the utility consumer group TURN, which at the time was Toward Utility Rate Normalization, now The Utility Reform Network. And so I worked for them litigating mostly energy proceedings, both natural gas and electric, and some telecom cases in front of the CPUC.
In fall of '94, I actually quit practicing law to go to art school. There's a long story behind that. But ended up going back to work at TURN for the summer of ‘95 to fill in for an attorney on paternity leave who was in the middle of litigating a Southern California Edison general rate case. So I think I'm the only art student who had a summer job litigating electric rate design at the CPUC.
Eventually in 1998, I joined the CPUC as an attorney. I started out doing FERC litigation in the wake of California's electric deregulation. Later I was the CPUC’s lead attorney on CEQA, the California Environmental Quality Act, similar to the federal NEPA, so I was advising the Commission on CEQA issues, particularly relating to transmission siting. I also acted as Interim Assistant General Counsel, supervising attorneys doing enforcement work before the Commission.
After a few years I became an administrative law judge, and did a range of proceedings in response to California’s energy crisis that followed its deregulation, including allocation of billions of dollars in electricity contract costs that the state of California had signed in the wake of PG&E and Southern California Edison becoming non-creditworthy. I was also the administrative law judge responsible for implementing California's RPS renewables portfolio standard. That was in 2003 and 2004.
In 2007, I left the CPUC and went to a major law firm which had a very strong energy project finance practice, so I was doing regulatory work supporting the energy project finance people, but also doing some other CPUC litigation, including representing Shell in a fight with Chevron over the cost of transporting crude oil on a CPUC-regulated oil pipeline. In late 2008 the firm went under, and I returned to the CPUC as an attorney.
After returning to the CPUC I mostly acted in an advisory capacity, but I also was Interim Director of the Policy and Planning Division, acted as an ALJ on a major electric procurement planning proceeding, and was again Interim Assistant General Counsel, this time on the advisory side. Later, I think around 2015, I became the deputy director of what was then the Consumer Protection and Enforcement Division (now the Safety Enforcement Division), supervising all of the utility safety issues.
Around 2016, I returned to being an ALJ, and presided over a range of proceedings, including resource adequacy, the retirement of PG&E’s Diablo Canyon nuclear power plant, and the state side of PG&E’s second bankruptcy. And then towards the end, I switched back to being an attorney, but on the advocacy side, and did a lot of work on wildfires, which was not really my specialty, but I learned a lot about a transmission and distribution ignited fires, and I negotiated the CPUC’s settlement with PG&E over their ignition of the Kincade fire. I retired in December, but I still like connecting with people in the industry.
MC: You’ve spent a lot of time in this sector, and especially during a time period that the utility industry was undergoing some vast changes. What do you think was the most important perspective you gained during that process that perhaps newer members to the industry could benefit from?
PA: When I decided to return to law in '98, I remember talking with my wife about it and she's like, "I don't know if you should go back to practicing law. Law's very demanding. It takes a lot of time and energy and I don't know if you want to do that given all of your other interests. Do you really want to take that on?" And I said, “Don’t worry - if you want a sleepy, obscure little backwater of the law, it's energy regulatory law.” Well, two years later, the California energy crisis hits and she's waving around the newspaper pointing to the headlines and going, “So this is your sleepy little backwater of the law, right?”
It's interesting how much of what is new is built upon a really old framework. The only people who were really following energy regulation before around 2000 were economists and engineers. This was not a hot policy thing and the governor's office was not involved in day-to-day decisions at the CPUC. It had been rolling along in its own way for decades, largely out of the public eye. But that meant that there were a lot established processes and structures in place, and a lot of those are still underlying a lot of what is happening today, with all of the changes and cutting-edge issues we are facing in this space, which sometimes makes it a bit weird and difficult to make changes.
I saw California's response to the energy crisis in 2000-2001, and the governor at the time did not have a coherent position on how to respond, and his appointees to the CPUC were appointed for political balance rather than a consistent philosophy. And so the CPUC did not have a unified or consistent position, so my take was that the fixes put in place in response to the California energy crisis did not represent a coherent vision. It was more like patching things together with the regulatory equivalent of duct tape and zip ties, salvaging scrap parts to put Humpty Dumpty together again. Is that a Frankendumpty? But that is what we've been building on ever since. So I think it's very difficult to figure out exactly how things are set up because there's no real underlying structure to it. Things have been added on and tweaked, but fundamentally it's been improvised patchwork. Kind of like you're building a Tesla on the frame of a Model T that had been modified with a Model A motor and then a '66 Mustang body and then thought: “oh, well, let's stick an electric motor in it.”
MC: The transmission sector is under more of a spotlight than ever before as utilities and stakeholders are realizing how much more will be needed to meet future needs, not to mention maintain affordability and reliability via modernizing existing infrastructure. How do you think leaders in the power industry should be balancing all the concurrent goals they are striving towards and the risks they are facing? What are your words of advice?
PA: Good luck!
I think it's really tough because you have all of these existing structures and multiple goals that don’t always align with each other. California going to an Independent System Operator system has resulted in a strong focus on reliability. But as a result the ISO is not always particularly attentive to siting issues, such as community and environmental concerns.
There are some tensions in California’s various policies, including its interest in building more transmission to access renewable generation, hardening the transmission system against wildfires and other threats, protecting disadvantaged communities from adverse impacts, and trying to control California’s already high electric prices. Balancing all of those things is going to be incredibly difficult.
On top of California’s high rates there is now a state law mandate for a new rate design that would add income-variable fixed charges, and the utilities have proposed crazy high fixed charges. Now even rate design is hitting the front pages!
I don't actually know how we can balance all these things - more resilience against disasters, lower cost, social and environmental justice, and more transmission for renewables. So I'm thinking that a more distributed model starts looking better.
MC: Why did you feel compelled to get more involved in the Energy Central Community? And what value do you hope to bring to your peers on the platform?
PA: I've spent over 20 years just swimming in this stuff, and I found it really interesting and engaging. While I've retired from the CPUC, it's not like I'm no longer interested in it. This is something I cared about and was engaged in for a long time. And I think also not being in the CPUC I have more flexibility to voice my opinions, which didn't always necessarily align with the way the CPUC was doing things at a given time. I was always free to voice my opinion within the CPUC, but I certainly wasn't going to go rogue or whistleblower and start throwing my personal opinions out in public.
One of the things I liked doing at the CPUC, especially towards the end, was working with a lot of the junior attorneys who had just started there. They're great, I really liked working with them. They're very engaged and interested in learning this stuff, and I really enjoyed mentoring those people who are on the steep part of the learning curve about how energy regulation works. So I'm interested in continuing to be engaged in this stuff, and I think I have an individual perspective that may not be unique, but maybe a little bit, and I am not shy about putting it out there. I hope others find it at least occasionally interesting.
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Thanks to Peter Allen for joining me for this interview and for providing a wealth of insights and expertise to the Energy Central Community. You can trust that Peter will be available for you to reach out and connect, ask questions, and more as an Energy Central member, so be sure to make him feel welcome when you see her across the platform.
The other expert interviews that we’ve completed in this series can be read here, and if you are interested in becoming an expert, you can reach out to me or you can apply here.