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| IBEW Says California Price Caps Too Little, Too Late April 30, 2001 The federal price caps imposed on wholesale electricity suppliers are not enough to help California out of its restructuring disaster, IBEW International President Edwin D. Hill said. In addition, federal action was "very late in coming-delayed long enough to wreak havoc on major IBEW employers," Hill said. The temporary caps fell well short of the regulation sought by California Gov. Gray Davis and others and are not expected to be enough to avert power shortages and blackouts in the coming months of high demand. "It doesn't stop the bleeding," said IBEW Local 47, Diamond Bar, California, Business Manager Patrick Lavin. Local 47 represents workers at Southern California Edison. The price ceilings imposed by the Federal Energy Regulatory Commission are scheduled to take effect next week. The order limits prices power generators can charge when the state's electricity supply reserves fall under 7.5 percent, considered a Stage 1 emergency. But the order does not include power marketers and brokers. Critics say the plan contains loopholes that gives suppliers any number of possible ways to continue to manipulate the market. The plan ignores reports from the California Independent System Operator, the state's grid operator, that generators can substantially raise market prices even when supplies are not technically short. "They had a chance to provide real relief for energy prices this summer," Gov. Davis said of the federal energy regulators, "and they simply blew it." The late Wednesday (April 25) announcement was delayed as the commission debated the action. Even FERC itself could not fully agree on the price plan, with the commission voting 2-1 in favor. "This agency is required to ensure just and reasonable prices during all hours," said FERC Commissioner William Massey, who voted against the order. "We are now 11 months into the California calamity. Now is not the time for half-a-loaf solutions." FERC also approved a plan to introduce a single electricity transmission system throughout the West. If the Cal-ISO does not produce a strategy for California's membership in such a system, the whole price-relief system could be withdrawn. Under that system, the agency will require that municipals or electric cooperatives that use the Cal-ISO-controlled transmission facilities abide by the pricing plan. As the state of California continues to buy power on behalf of the hobbled utilities, the sheer scale of economic damage to the state's bottom line increases daily. Already state lawmakers are drafting a budget for fiscal year 2001-2001, which starts July 1, that includes up to $4 billion in cuts to fund the gaping hole in the state's treasury.
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California Utility Crisis Related Stories 6/20/01 - Preserve Best of Utility Industry, IBEW Tells Management Conference 5/2/01 Cheney: Increasing Energy Supply Vital 4/30/01 IBEW Says California Price Caps Too Little, Too Late 4/24/01 Nevada Pulls The Plug on Restructuring 4/06/01 Press Release - Pacific Gas and Electric Company filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code. 3/30/01 Update - Some California customers are seeing a 42% increase in utility rates as a result of restructuring. San Diego Local Urging Generator Use to Lighten Electricity Load 5/8/01 - IBEW Hits California Airwaves to Support Gov. Gray Davis March Against the "Game" Nobody knows better the high costs of California's failed experiment with utility deregulation than the front line - the state's IBEW workers. IBEW Seeks Remedy to Deregulation's "Colossal Failure" The IBEW rallied support for recovery from a crisis that threatens everyone, not just Californians. President Hill speaks out on Utility Restructuring.
Status of Deregulation. Department of Energy's Web site. AFL-CIO Executive Council Statement February 17, 1999 Sound off on our crisis discussion board in the Private Community |
