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CPUC GO156 Report to the Legislature and Report on CPUC Procurement Spend

CPUC GO156 Report to the Legislature and Report on CPUC Procurement Spend. Paul Clanon Executive Director California Public Utilities Commission CPUC Diversity En Banc November 2, 2009. GO 156 Report to the Legislature. CPUC’s 23 rd Annual Diversity Procurement Report:

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CPUC GO156 Report to the Legislature and Report on CPUC Procurement Spend

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  1. CPUC GO156 Report to the Legislature andReport on CPUC Procurement Spend Paul Clanon Executive DirectorCalifornia Public Utilities Commission CPUC Diversity En Banc November 2, 2009

  2. GO 156 Report to the Legislature • CPUC’s 23rd Annual Diversity Procurement Report: • Details progress by utilities in procuring goods, services, and fuel from women-, minority-, and disabled veteran-owned business enterprises (WMDVBEs). • CPUC verifies status of WMDVBE applicants, reports results of program, and makes recommendations to achieve maximum results in implementing legislative policy. • 29 Utilities Filed Annual Reports • Large utilities (11) are those with annualtotal procurement of over $150 million. • Small utilities (18) are those with less than $150 million in annual total procurement.

  3. GO 156 Report – Goods & Services Procurement Good News • Utility WMDVBE spending increased from $2.80 billion in 2007 to $3.47 billion in 2008, an increase of 23.93%. Bad News • As a group the 29 utilities are not meeting the goal of 21.5% procurement. • As a percentage of total utility procurement, amounts from WMDVBE firms decreased from 14.57% in 2007 to 13.19% in 2008. • Six large utilities performed significantly better than the others. Namely, AT&T California, Sempra Utilities, and Verizon California were either at or above 30% procurement. • 5 of the 11 large utilities are underperforming: AT&T Mobility, AT&T Communications of California, AT&T/ASI, Verizon Wireless, and Sprint Fuels Procurement • Utility spending on WMDVBE fuel procurement increased from about $702 million to about $848 million in 2008 (almost 100% natural gas).

  4. GO 156 Report – Overview of Procurement Total Utility WMDVBE Procurement for 2008: $3.47 billion – a 23.93% increase from the $2.73 billion reported in 2007. Of the $3.47 billion for 2008, the results show:

  5. GO 156 Report – Overview of Fuel Report Total Utility WMDVBE Fuel Procurement for 2008:$848 million as compared to 2007, which was $702 million. Of the $848 million for 2008, the results show:

  6. CPUC Procurement – Overview of SB and DVBE Total CPUC 2008 Small Business and DVBE Procurement: $45.7 million Of the total spend for 2008, the results show: • The CPUC must adhere to Proposition 209 and cannot actively pursue a goal to increase procurement from minority businesses. • However, the Governor asked each State agency to pursue a goal of 25% procurement from Small Businesses and 3% from DVBEs. • The CPUC is working to unbundle its contracts to encourage more Small Business procurement as well as DVBE procurement.

  7. Looking Ahead… • In July the CPUC opened a Rulemaking to consider whether to amend GO 156, established over 20 years ago. The rulemaking will examine: • Where supplier diversity gains have been achieved • Reasons behind low gains in some procurement areas • Strategies for improvement • Whether the changing nature of the energy, communications, and water markets affords opportunity for the CPUC to encourage development of diverse suppliers in new procurement areas • The CPUC will continue its leadership in promoting diversity by closely monitoring the program, listening to the utilities and the public, and offering guidance to the utilities to achieve successes inopening procurement opportunities to WMDVBEs.

  8. Thank You! For Additional Information: www.cpuc.ca.gov/PUC/supplierdiversity/

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