Former Top CPUC Director “Disgusted” by Behavior of Leadership

A former high ranking member of the California Public Utilities Commission (CPUC) spoke out for the first time since retiring from the agency last fall. In an exclusive interview with the NBC Bay Area Investigative Unit, he called the actions of some of the CPUC’s former leaders “disgusting.”

For more than a decade Richard Clark held one of the agency’s most critical positions as Director of Consumer Protection in the Safety Division. He said his decisions to draw an ethical line with Pacific Gas & Electric Company (PG&E) contradicted a culture of improper access and influence granted to utilities by other power-brokers at the agency.

Emails between former president Michael Peevey, CPUC staffers and top PG&E leaders have exposed what insiders have called a potentially unethical business relationship. Peevey walked out of the CPUC under a cloud of controversy and PG&E fired three top executives. The state’s Attorney General and the United States Attorney are now investigating.

In an email from February 2011, now former PG&E executive Brian Cherry asked for a private meeting “one on one” with Clark at a time when the commission was considering a multi-million dollar penalty against the utility for a fatal pipeline explosion in Rancho Cordova in 2008.

Clark said the request was “absolutely improper.”

“My message was I don’t meet with utility reps one on one,” he said. “I’m not negotiating.”

In another instance, PG&E attempted to remove Clark from testifying before the United States Senate a few weeks after the San Bruno pipeline explosion. Clark only found out about it last year after a judge forced the CPUC and PG&E to release more than 65,000 internal communications.

In a September 2010 email, Cherry asked to chat with CPUC Executive Director Paul Clanon, “Just got a call from the General Counsel who is worried that Richard Clark may try to blindside Chris in D.C.,” Cherry wrote.

The “Chris” Cherry referred to was Chris Johns, PG&E’s president. Ultimately, the utility succeeded in removing Clark as a witness in the senate hearing. Instead, Clanon testified before members of Congress.

“I was surprised that it happened,” Clark said. “And to know that it was because PG&E asked for me to be replaced to testify before the Senate is disgusting.”

“Apparently they get what they ask,” he added.

Hours after Clanon testified, Cherry and Clanon exchanged emails regarding the executive director’s testimony before the Senate.

“FYI, I missed your performance but my wife loved it,” Cherry wrote.

Clanon responded: “Then I am planning a torrid affair with her.”

“Disgusting behavior days after eight people died in San Bruno,” Clark said. “All that damage that was done. Absolutely disgusting.”

Clark told NBC Bay Area that he was forced from his director’s seat at the CPUC and accepted a less prominent position as an administrative law judge in 2011. Last fall, Clark decided to retire from the agency.

In his first sit-down television interview, the CPUC’s new president Michael Picker told the NBC Bay Area Investigative Unit that the commission is “all disappointed in ourselves.”

“I’m focusing on how do we make this the organization that we really think it should be,” said Picker, who was appointed by Gov. Jerry Brown in December. “Then how do we let the public see that we’re actually doing that and that they should actually have more confidence in the output of our work.”

Scott Hempling, a recognized expert on public utilities and regulatory commissions has closely watched the unraveling of power at the CPUC and the investigations that have followed.

“I have never seen this type of intimacy, where personal relations and policy decisions have come together,” Hempling said. “So it’s unique and it’s disturbing.”

Hempling also reviewed a complaint raised by a CPUC insider who asked to remain anonymous. In an email sent to the NBC Bay Area Investigative Unit, the insider wrote: “Instead of disciplining employees who have committed serious ethical violations…the CPUC promotes them to new positions and excuses their behavior.”

The insider pointed to CPUC powerbroker Carol Brown. She stepped into a new role working for the agency’s water division shortly after resigning her post as Peevey’s chief of Staff. Brown’s own internal emails implicated her in helping PG&E attempt to gain a favorable ruling in a proceeding related to the San Bruno pipeline explosion.

After the Investigative Unit started asking questions about Brown’s reassignment, in May, she retired. Attempts to reach Brown for comment have gone unanswered.

“I’ve never seen that type of codependency. It has to be rooted out,” Hempling said. “There is ample reason for the public to insist before it pays another dollar that the culture is turning around.”

Hempling said Picker and the four other commissioners must regain the public’s trust. Picker said that he knows he must fix the loss of credibility that has plagued the CPUC in recent years.

“I don’t want to make empty gestures,” Picker said. “I want to see us actually be able to follow through on those types of core values here at the PUC in a way that people can see it, they can feel it, they can taste it, they can hear it and they can smell it.”

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