Utilities commission chief sees no conflict of interest. Consumer
advocates say Gregory Sopkin's frequent conference trips reveal a
weakness in state law.
By Chuck Plunkett
Denver Post Staff Writer
7/8/06

Gregory Sopkin has been Public Utilities Commission chairman for 3
1/2 years. He has taken nearly 30 outof- state trips paid for by
industry or its representatives.

As chairman of the commission mandated to make sure Coloradans are
well-served by their utilities, Gregory Sopkin has become a frequent
guest at conferences hosted by the industries he regulates.

Sopkin's appearance at so many of the conferences troubles consumer
advocates, who say that Sopkin's frequent industry-paid trips raise
questions about the strength of a state law that appears to allow the
trips.

During his 3 1/2 years as chairman of Colorado's Public Utilities
Commission, Sopkin at times has won praise for his free-market
approach, which has helped expand the number of independent power
producers in the state.

At the same time, Sopkin's PUC deregulated Qwest Communications last
year, and consumer advocates say a fear of Sopkin's pro-market,
limited- government ideology is driving them to settle cases they
normally would fight. The PUC currently is considering a rate-increase
request by Xcel Energy that would raise average home bills for most
Coloradans by 11.6 percent.

"He's basically being a consultant to the industries," said Rex
Wilmouth, director of the Colorado Public Interest Research Group,
after reviewing some of the trips and conferences Sopkin has attended.

Wilmouth is a longtime critic of Sopkin who has expressed concern
since Gov. Bill Owens' decision to appoint the former Xcel Energy
attorney to the commission in January 2003.

Sopkin denies the assertion and wrote in response to written questions
that any implication that his ideology prevents a fair-minded approach
to his PUC duties "is completely inaccurate and unsupported by the
record."

"I strongly believe that my economic views result in the best possible
outcomes for all PUC stakeholders - consumers, utilities and the state
of Colorado as a whole," he wrote.

Utility executives who value Sopkin's leadership say he is in demand
at conferences because he has the ability to speak clearly and
intelligently about the complex realities of the regulated industries
he monitors.

They point to recent tough stands the PUC has taken against Xcel that
they say should lower consumer bills.

Nicholas Muller, the director of the Colorado Independent Energy
Association, said Sopkin "is one of the very few people ... who see
that competition is essential for keeping costs down."

A review of travel records and conference agendas shows that 3½ years
into his leadership of the commission, which pays him $96,500 a year,
Sopkin has traveled out of state nearly 30 times on trips paid for by
industry groups or representatives. By contrast, he traveled at
government expense to conferences specifically for regulators fewer
than 10 times.

Many of the industry conferences are held at resort hotels, a few of
which typically charge more than $500 a night. Sopkin has stayed at
seaside resorts in California and Florida, at hotels in Las Vegas, at
high-dollar digs in Washington, D.C., and at other pricey areas.

Some of the industry-sponsored conferences were held with the goal of
helping executives and attorneys learn how to win increases in the
rates they charge their customers.

In May, for example, Sopkin spoke at a conference for energy
executives in Miami titled, "Rate Case 101: How to Produce a
Successful Rate Case." He was one of only two regulators among the
nearly 20 speakers or panelists listed. The other participants were
energy consultants and power-company executives. Though other
conferences sometimes invite more regulators, the speakers and
panelists assembled typically follow this pattern.

"I did not speak to 'how to succeed' in a rate case," he wrote to The
Post. "Since I did not and would not comment on how I or the PUC would
treat any pending or future issues, there was no conflict of interest
in presenting at the conference."

The Miami conference was put on by Electric Utility Consultants, a
pro-industry group based in Denver, and sponsored by industry
consultants. The organizers paid $540 for Sopkin's airfare and lodging
at the Coconut Grove Doubletree. They also waived the $2,795 fee
charged other attendees.

Consumer groups say such fees, which are typical at the conferences,
prevent them from attending. And consumer advocates are rarely guests
of the conferences.

Education claim

Sopkin says many utility commissioners attend and participate in
conferences, and that ratepayers benefit from the education the
commissioners gain at such events.

"Each time I give a speech, I must thoroughly research the subject
matter, which keeps me up to date on the issues of the day," he wrote.

Colorado law requires its commissioners to conduct themselves in a
manner that avoids conflicts of interests or the appearance of a
conflict of interest.

The law says commissioners are to "refrain from financial, business,
and social dealings" that could interfere with their objectivity.

At the same time, the law allows commissioners to "participate in
meetings, conferences, or educational programs which are open to other
persons." The law allows for lodging and travel expenses to be paid by
others

but doesn't allow payments or gifts for a commissioner's participation.
The other two commissioners on the PUC have made far fewer trips.
Records show that Carl Miller hasn't attended any out- of-state
conferences, and Polly Page has attended only three, nonindustry
conferences.

Conference organizers say the events provide a valuable service.
Executives and regulators who attend get a better education on
real-world issues. Attorneys use the conferences to obtain
continuing-education requirements. Consultants come to build their
client base.

The conferences "are common throughout every industry across the
country, and serve as important venues for education on new
regulations as well as implementation of state and federal laws," Bill
Holbrook, a spokesman for the Electric Power Supply Association, said
in an e-mail.

But consumer advocates are critical of the apparent disparity of
access to Sopkin they have compared with that of big-industry
interests assembled at these conferences.

"The public is not getting that kind of time," Wilmouth said.

Testimony questioned

Meanwhile, they say, working with the commission under Sopkin's tenure
has been difficult.

Early on, in January 2004, supporters of a bill requiring electric and
gas companies to start or expand conservation programs were surprised
to see Sopkin testifying before a state House committee considering
the bill.

The bill's sponsors said Sopkin explained to the committee that he was
offering his testimony as a citizen, not as part of his official
duties at the PUC. His statements drew questions from legislators and
seemed out of line, the sponsors said, because if the bill had passed,
the PUC would have been responsible for overseeing the conservation
programs.

Sopkin had argued that it wasn't necessary to require utilities to
establish conservation measures.

"He's been hostile to having utilities help their customers conserve
energy," said Howard Geller, the director of Boulder- based Southwest
Energy Efficiency Project. "He's been for building more coal-fired,
base- load power plants, which are very costly and very polluting.

"So I don't think he has customers' best interest in mind. He's put
his own personal ideology above that of best interests of consumers."

Some executives who operate power plants disagree.

Twice this year, the Colorado Independent Energy Association, a member
of the Electric Power Supply Association, has applauded the PUC for
its belief that Sopkin stood up to Xcel.

"The last two decisions to come out of the PUC, I would say, are in
favor of the consumers, the ratepayers," Muller said.

The independent generator representative said he credited Sopkin for
preventing Xcel from reducing state requirements that it engage in
competitive bidding that benefits independent energy providers. The
independent companies argue that the bidding requirements support a
free-market environment that drives down costs to consumers.

Mark Davidson, a Denver attorney who has represented both the PUC and
industry, says he attends one or two conferences a year to meet
continuing-education requirements, and that the regulators who attend
follow the rules.

Regulators are diligent, Davidson said, in avoiding conversations with
representatives for companies who have cases before the commission.

"They take that quite seriously," he said.

Other states have stricter travel rules than Colorado's. In New York,
only outside groups that are not regulated by the state can pay for a
utility commissioner's travel expenses. And the expenses are capped at
rates the state itself would pay, unless the commissioner is granted
specific permission. The rate for a hotel stay is about $200. In
Illinois, commissioners are not allowed to accept free travel from
anyone they regulate - directly or indirectly.

"Certainly we don't expect people to be going away every weekend to
exotic locales," said New York Ethics Commission spokesman Walter
Ayers.

Staff writer Steve McMillan and researchers Barry Osborne and Regina
Avila contributed to this report.