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June 23rd, 2009
Guest column: Outrage at PEC

Guest Column
By State Representative PATRICK ROSE
and State Senator TROY FRASER

We are outraged that the Pedernales Electric Cooperative (PEC) Board of Directors would agree to indemnify its former law firm by agreeing to a settlement the same week that the Blanco County Grand Jury indicted a principal partner with that firm.

This action by the legacy directors is consistent with the tactics used by Bennie Fuelberg, the former general manager, to hide information from the members and employees. It is unbelievable that five days before a new board is elected by the members, the old guard is still making major decisions. These decisions should wait until the new board of directors duly elected by the members are sworn in.

We believe that further misdeeds of the PEC Board of Directors and former General Manager will be uncovered – including the possibility that there were other misapplications of funds to the law firm. As long as a criminal case is ongoing against Walter Demond, the former outside counsel, we would ask the cooperative board to not settle this matter. It is in the best interest of the members that PEC wait until it has all information necessary in order to make the best deal possible.

Members and employees want the whole truth, not the truth outlined in a settlement agreement. With the indictments issued this week, and as the criminal trials progress, we believe that the members and employees will get the answers they deserve. By accepting this settlement agreement, the board appears to have reverted to its former practices of putting up roadblocks to prevent members from fully participating in the cooperative that they own.

Just like the settlement in the civil lawsuit, the only true winners in this settlement are the attorneys – the law firm being indemnified – and PEC’s trial attorney who now gets $1.3 million for agreeing to the settlement.

These actions by the PEC board further confirm that its members and hard working employees need protections in the law. We remain committed to passing legislation that guarantees democratic elections and open governance.

Senator Troy Fraser represents Senate District 24, which includes Bell, Blanco, Brown, Burnet, Callahan, Coleman, Comanche, Eastland, Erath, Gillespie, Hamilton, Kerr, Kimble, Lampasas, Llano, Mason, McCulloch, Menard, Mills, San Saba and Taylor Counties. He is Chairman of the Senate Committee on Business & Commerce.

Representative Patrick Rose represents House District 45, which includes Blanco, Caldwell and Hays Counties. He is Chairman of the House Committee on Human Services.

Sen. Fraser and Rep. Rose represent the Pedernales Electric Cooperative headquarters in Johnson City.

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8 thoughts on “Guest column: Outrage at PEC

  1. I suppose it is better late than never?

    These legislators did nothing during the past 6 years to provide any oversight to the electric industry, especially cooperatives — especially PEC.

    When I wrote Rep. Patrick Rose regarding PEC I never even received a response to my many emails.

    Senator Jeff Wentworth is another lackluster lawmaker who opted to do nothing re: PEC oversight. Unlike Rep. Rose, I did receive a response from Sen. Wentworth. Unfortunately, Wentworth simply stated that the legislature “is watching” the new PEC Director. Wentworth and other lawmakers continue to do little for the people they are supposed to serve and protect.

    In addition, when Gov. Rick “Deregulate Electricity” Perry pushed through his special interest bill neither Fraser, Rose or Wentworth stood up for the people of Texas. They approved the bill to provide the electric industry with more clout and less oversight, which resulted in higher electric costs for Texans.

    As far as Texans are concerned, Rep. Fraser, Rep. Rose and Sen. Wentworth are part of the problem re: PEC and other electric coops and companies.

    Texans will continue to pay top dollar for their electric needs as long as special interests continue to buy our lawmakers.

  2. Amen! We do need deregulation so that the market will help to lower rates. It has worked in other parts of Texas and would work here, too.

  3. Janice, what facts have YOU been reading that verifies your spin?

    Deregulation has NOT made the market “more competitive”. That’s just the battle-cry and scam of wealthy interests.

    Not only have electric rates risen after deregulation, but so have higher education tuition costs after the governor and lawmakers approved the deregulation of those entities. In fact, since that bill was approved UT raised its tuition rates 4 times and other colleges and universities followed suit.

    Once upon a time in America deregulation was good. But that was then and this is now. GREED for profits has taken over sensibility and fair markets.

  4. Texas needs more, not less, oversight of not only our electric utilities, but all our energy and water utilities. Has deregulation ever actually reduced rates or fostered positive competition in Texas? My recollection is that the industry clamored for deregulation, only for rates to increase. Our state Reps need to focus less on spinning their ‘outrage’ and spend more time making the right choices.

  5. Utility rates are going up because of global factors, not because of deregulation or regulation. Electricity and water will only get more expensive regardless of what our inane elected officials say.

  6. Well, its not that simple. Supply and demand regulate production rates, but energy companies (or any company) will always try to sell at the highest price possible, regardless of actual demand (or supply). The energy industry has billions of dollars worth of lobby power that is pushing for less regulation. Those lobbyists are paid to look out for the industry’s best interests. Who is looking out for the working man’s interests?
    Yes, electricity and water rates will only get more expensive over time. But guess what? they are currently artificially deflated. The follow thru to all of these points is this: If rates increase to a realistic value (when you calculate in all the hidden and future costs of current usage)then you reach a point at which demand shrinks and eventually, thru the pendulum of supply and demand, as well as changes in technology, we get closer and closer to a real value that is fair to all involved, including the environment.

  7. I agree with J.R. on this issue. The word GREED for profit comes into play. World energy markets, law of supply and demand certainly play a part in costs.

    In addition, lax legislation permits some of the financial abuse of customers. Generally, electric companies charge more than electric cooperatives. Lawmakers like to keep coops the way they are because they tell us that coops force electric companies to keep costs low.

    PEC for example, charges around 11 cents per kilowatt hour, while electric companies usually charge more than that. However, both charge inflated prices for electricity.

    Now, PEC wants to charge those members who use more electricity less per month. It’s an interesting consideration. Why would they do that?

    My home uses only electricity. This month my bill was $436. According to the PEC plan, I should be paying less because I use more. That’s not happening.

    Something has to change in the industry so customers are treated more fairly and costs are more reasonable.

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