[cdn-nucl-l] Deregulation a mistake? PROFITEERING

["Jerry Cuttler" <jerrycuttler@home.com>]

This is somewhat different than long-distance telephone service, isn't it?

----- Original Message -----
From: <marc832@primenet.com>
To: Multiple recipients of list ans-pie <ans-pie@nuke-ans.org>
Sent: Sunday, July 23, 2000 8:22 PM
Subject: The Energy Looking Glass 19july2000 PROFITEERING


> PROFITEERING CITED IN RISING POWER RATES
> ELECTRICITY: A STATE UTILITY COMMISSIONER CALLS DEREGULATION A 'MISTAKE' -
>    BUT HE URGES A GO-SLOW APPROACH
>
> by James B. Kelleher       The Orange County CA REGISTER  July 19, 2000
>
> SAN DIEGO -- A top state regulator on Tuesday called the recent surge in
> electricity prices in San Diego and southern Orange County "the
predictable
> consequence of an ideologically driven regulation policy," joining a
> growing chorus of critics who say the state needs to intervene to offer
> customers relief.
> At a news conference here, Carl Wood, a state Public Utilities Commission
> member, called deregulation a "mistake" and said certain unnamed players
in
> the nascent free market were "profiteering at consumers' expense"
>
> But Wood, an appointee of Gov. Gray Davis, stopped short of calling for
> re-regulation of the state's $20 billion energy market. He also defended
> the PUC's decision to delay consideration of an emergency petition asking
> the agency to roll back and freeze rates for San Diego Gas & Electric
> customers.
>
> "It was a mistake", he said. of the 1996 law exposing state consumers to
> the volatile energy market. ," That mistake has now turned into a crisis.
> We need to make sure it doesn't turn into a disaster."
>
> The consumer advocate who submitted the rollback petition, Michael Shames
> of the Utility Consumers Action Network, said he was "frankly
disappointed"
> by Wood's unwillingness to push his four fellow commissioners to put the
> item on the top of the agenda.
>
> Shames hoped the PUC would consider the measure Thursday at its formal
> meeting of the month. But Wood said the commission probably would consider
> the request at its Aug. 3 meeting-- the last before the .commissioners
take
> a month long holiday.
>
> It's like a bleeding patient has been wheeled into an emergency room and
> the doctors are saying, "Let's take a few weeks to figure out what's
> wrong,," said Shames, who authored a study last. year predicting this
> summer's rate shock. '"We know what's wrong. The patient is bleeding, and
> he needs immediate attention".
>
> Wood also raised the possibility of extending the transition timetable for
> California's two other investor-owned utilities, Southern California
Edison
> and PG&E, giving more time to recoup the money they're losing because of
> sharp price spikes in the electricity market. Because the two utilities
are
> still regulated, they have not been able to pass those increases onto
> consumers.
>
> Under the state's phased-in deregulation plan, SDG&E's 1.1 million
> customers are the first in California - and the nation to pay market
prices
> for electricity.
>
> As pioneers, SDG&E customers were to enjoy lower monthly bills, according
> to deregulation proponents. Instead, the opposite has happened. Over the
> past month, average monthly bills in the area served by SDG&E have doubled
> and in some cases even tripled as the open-market price for electricity
> surged to record levels.
>
> So far, only one commissioner, Richard Bilas, has publicly embraced the
> idea of a rate freeze, Shames said.
>
> Wood and PUC President Loretta Lynch have expressed strong reservations
> about deregulation and are leaning toward state action to address the
> rising prices.
>
> The answer is to use all the tools at our disposal, including regulatory
> tools," Woods said Tuesday. "I don't think we can rely on market forces to
> get us out of this situation."
> '
> Several entities, including  SDG&E and San Diego, oppose the rate
rollback.
> SDG&E has proposed offering customers a fixed-price plan, which it says
> would solve the problem of high monthly bills by averaging payments over a
> year. The SDG&E plan would not, however, address the underlying issue of
> skyrocketing prices and volatility in the open market.
>
> While admitting that Shames' bleeding .patient  analogy was "fair,". Wood
> said, "This whole industry is fraught with examples of unintended
> consequences. We don't want to make this worse."
>
> Wood said California's deregulation plan ceded too much authority to
> federal agencies like the Energy Regulatory Commission. As a result, he
> said, many simple solutions to the present crisis are "beyond the reach of
> the CPUC .... We have to retrieve some of that authority."
>
> Wood has strong ties to the counties hit by the price spikes. Before
> joining the PUC, he worked as a nuclear-maintenance electrician at San
> Onofre, served as a top union official at the Utility Workers Union of
> America in  Los Alamitos, and lived in Fallbrook in northern San Diego
County..
>
> Although clearly stung by Wood's criticisms of the free -market's
failings,
> an SDG&E official who attended Tuesday's press conference said the company
> was heartened the commission's go-slow approach.
>
> '"We believe there's a market-based solution to this out there," said Art
> Larson, an SDG&E spokesman. '"We think the rate rollback and. freeze
simply
> puts these rate increases on layaway Until the holidays.'
>
> Regards     marc832@primenet.com  whois  Gene  Cramer
>