3. Review of GO156 Program Results
Several of the largest utilities have shown strong commitment to the GO 156 program goals and made strides in developing successful WMDVBE suppliers. However, with some individual exceptions, the utilities as a group are not meeting all of the target goals and not awarding WMDVBE contracts evenly across procurement areas. For 2007 and 2008, the Commission gathered information on results from thirty utilities, including seven water companies. Total utility spending on WMDVBE procurement increased from $2.80 billion in 2007 to $3.33 billion in 2008, an increase of 18.9%. As a percentage of total utility procurement, amounts from WMDVBE firms decreased from 14.57% in 2007 to 14.37% in 2008.7
The Commission's September 1, 2008 report (Report) to the Legislature on 2007 utility procurement information included a summary of the 2007 results for all reporting utilities:
Table 18
2007 Total WMDVBE procurement: Category |
Procurement Amount |
Percentage Achieved |
Goal |
MBE |
$1.8 billion |
9.40% |
15.0% |
WBE |
$927 million |
4.83% |
5.0% |
DVBE |
$67 million |
0.35% |
1.5% |
The Report is separated into two categories: 1) large utilities (those with total procurement over $250 million); and 2) small utilities (those with procurement under $250 million). The large utilities represent almost all (97%) of total utility procurement. Eleven large utilities reported activity in their WMDVBE programs:9
Cingular Wireless
Southern California Edison (Edison)
Pacific Gas and Electric Company (PG&E)
AT&T California
AT&T Communications of California
AT&T/ASI
San Diego Gas & Electric Company (SDG&E)
Southern California Gas Company (SoCalGas)
Verizon of California
Verizon Wireless
The 2007 results for the large utilities show an overall WMDVBE procurement increase from 2006 of $55 million to a total of $2.72 billion, as well as an increase of 1.89% of total procurement to 14.88%.10 The large utilities increased their percentages from the prior year in each of the three WMDVBE categories, and the small utilities increased their percentages in the MBE and WBE categories.11 The results show the utilities are nearly meeting the 5 percent goal for women-owned businesses, but are neither achieving the 15 percent goal for minority-owned business enterprises, nor the 1.5 percent goal for disabled veteran-owned business enterprises.
Based on preliminary 2008 data recently submitted by participating utilities, the six largest California utilities report the Supplier Diversity program is successful insofar as meeting the total aggregated goal of 21.5% procurement from certified diversity suppliers. A five-year summary of the total WMDVBE procurement percentage for the six largest utilities is set forth in Table 2 below:
7 2008 data is preliminary and subject to adjustment.
8 Report at 3.
9 Sprint reported its data in a manner inconsistent with GO 156 and is excluded from reported data.
10 Report, Tables 1A and 1B in Attachment A.
11 Report at 3.
