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CA ENERGY CRISIS UPDATE April 30, 2001 ENERGY CRISIS UPDATEFERC EXTENDS HELPING HAND TO PRICE GOUGERS The Federal Energy Regulatory Commission is considering imposing a fee on electricity sales in California to reimburse unregulated power suppliers for money the suppliers have been unable to collect from the state's utilities. FERC has repeatedly refused to impose price caps on unregulated power providers-despite FERC's own finding that wholesale rates in California were neither just nor reasonable. FERC justified its inaction by claiming that market forces should be allowed to sort out California's energy problems. FERC's inaction led to a huge tide of red ink at Pacific Gas and Electric, which had to pay outrageously high prices for wholesale power but was severely limited by state law in what it could pass on to its retail customers. But when PG&E filed for Chapter 11 protection on April 6, doubts increased about whether the unregulated power suppliers would ever be able to collect all the money PG&E owed them. Suddenly FERC seems to have lost its enthusiasm for letting the market sort things out. The FERC proposal would impose a new charge on California ratepayers in order to funnel additional billions to some of the very same unregulated companies who drove PG&E to bankruptcy and who have drained over $5 billion from the state treasury since January. One veteran FERC staff member told the Wall Street Journal he couldn't remember any precedent for the proposed action. "It's asking us to be a collection agent for bills that aren't just and reasonable," he said. The proposal was contained in a single paragraph buried in a 39-page order issued last week by FERC dealing with the issue of runaway wholesale electric prices. CPUC TO CONSIDER BANKRUPTCY-FILING PROBE The California Public Utilities Commission will meet on May 3 to consider launching an investigation into how the bankruptcy-protection filing by PG&E will affect ratepayers and power suppliers.
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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. |
