Each year the California Public Utilities Commission (CPUC) shines a light on California’s investor-owned utilities’ efforts to boost local economies through working and spending with diverse suppliers. Black businesses benefit from some of this investment, and I am working to grow that share as one of my New Year’s resolutions. We should celebrate the CPUC for emphasizing investment in diverse suppliers and push the Commission to avoid undermining this investment with other policies.
The CPUC held its 20th Annual Supplier Diversity En Banc, “Implementing Best Practices to Reshape the Future of Supplier Diversity,” in October 2022, highlighting the efforts of investor-owned utilities’ efforts to support diverse suppliers. The California Water Association (CWA), which represents regulated utilities providing water to more than six million Californians, has a long-established supplier diversity commitment to help members work with businesses owned by women, minorities, disabled veterans, members of the LGBTQIA community, and persons with disabilities.
As a result of our industry’s commitment, an average of 37% of the contractors used by California’s seven largest investor-owned water utilities are owned by a diverse supplier. That equates to nearly $750 million invested in diverse suppliers and contractors in 2021 alone.
One of California’s utilities increased water and wastewater treatment spending with disabled veteran-owned businesses by 35% in 2021 over 2020, and generally increased spending with diverse subcontractors by 30%.
A3K Consulting, an African American woman-owned consulting firm, worked with the CWA over the past year to design and create a strategic plan, which has been adopted by the association’s 80+ investor-owned member utilities and addresses diversity, equity, inclusion, water quality, and water safety, all of which are issues critical to our community.
I want to see more participation by Black-owned businesses, which is currently less than 1% of the otherwise impressive total diverse spend by water utilities. How do we increase this percentage? Seven investor-owned water utilities collaborate annually to present two events to offer a more personalized approach for suppliers and utility buyers and staff to get to know the people behind the business enterprise. When you know the people you’re doing business with and can trust their integrity, character, and skills, there is greater opportunity for successful business partnership. These events encourage a deeper understanding and sharing of mutual goals and objectives that go beyond the singular opportunity for contract award.
The Supplier Diversity Program, which I have the honor of running for Liberty, helps us strengthen the utility supply chain, grow and develop diverse supplier partnerships, and enhance and positively impact the communities that we serve. I can stand confidently in the knowledge that we are positively and greatly influencing the diverse supplier marketplace and the economies in which they reside.
These achievements benefit everyone – the utilities, small businesses, and the communities they serve. Over one-third of customers served by California’s regulated water utilities live in underserved communities, and the areas served need innovative investments in water infrastructure to prepare for challenges that climate change present to the future of water resilience in California. Our investments in supplier diversity enhance customer confidence and satisfaction and represent a high-value use of the dollars spent on capital investment. Water utilities’ services and projects succeed when the professionals doing the work know, understand, and reflect the people in the communities served.
Regulated water utilities use customer-funded dollars to leverage larger investments back into repairs and maintenance of existing infrastructure and capitalize on the latest innovations in their local water infrastructure projects. The strength of our investments depends on important financing decisions made by the CPUC to attract the necessary funding to make these infrastructure investments.
Supporting local firms with the right expertise, workforce, competitive prices, and community understanding is one way that water utilities provide benefits to the customers who help generate the funding and the businesses at work in their neighborhoods.
I look forward to working with more Black-owned businesses and other diverse suppliers in the years ahead to continue diversifying Liberty’s supplier community and supporting the CPUC’s continued incentivizing of diverse investment that benefits all of us and our communities.
Holley Joy is the supplier diversity program manager for Liberty Utilities.