Historically, states have delegated responsibility for establishing and implementing their energy policy to a public utilities commission (PUC). During most of the 20th century, state PUCs operated with relatively little interference from state legislators. In California, for example, the PUC, created by the state constitution, was vested with the broad authority to independently regulate nearly all aspects of electricity service. To help protect its independence, the legislature purposely based the PUC in San Francisco—safely distant from the political machinations in Sacramento.
Over the past decade, however, state legislatures have been more assertive about setting energy policy. In the late 1990s, for example, elected officials in California and dozens of other states passed laws that deregulated many aspects of electricity supply and delivery with the expectation that the "invisible hand" of the free market would result in greater efficiency and lower costs. This trend of active legislative "participation" is now in full flower in the Golden State, as exemplified by energy-efficiency rules for appliances, mandatory renewable portfolio standards for utilities, and limits on greenhouse gas emissions.
Having legislators, rather than specialized administrative agencies, set energy policy should not, by itself, frustrate long-term policy objectives. This shifting of responsibility, however, must be recognized as a significant change in the formulation and implementation of energy policy whose consequences warrant greater scrutiny.
Fresh faces, new ideas, but . . .
Increased legislative activity, especially in states with term limits, can facilitate the development of better energy policies. Because new legislators are not burdened by the past "failures" of incumbents, they are freer to explore new ideas and more willing to embrace novel approaches.
Case in point: In California, the reinstatement of retail choice would have little chance of success if the same legislators who suspended "direct access" in response to the electricity crisis of 2000–2001 were still in office. Had they been reelected, those politicians would now hold positions of leadership commensurate with their seniority and be in a position to block efforts to lift the suspension.
Counterintuitively, increased involvement by "rookie" state legislators in energy policy may serve to limit their effectiveness. The need to become an instant expert in the field may prove too much of a burden for a new state senator or assemblyperson. Often, the overwhelmed new legislator becomes overly reliant on staff and lobbyists for "short cuts" to understanding a complex energy issue. The result, in this case, is an increase in the relative influence of the unelected.
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