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The good news is that California seems to be recovering steadily from last years disastrous brush with an open electricity market. Sky-high prices have become manageable, and new power plants have been constructed, relieving the state of its reliance on out-of-state energy marketers. And as if there were any doubt, Enron was definitively exposed in May as a manipulator of the states energy crisis, using a grab bag full of tricks to exploit the market and push prices to astronomical levels.

The bad news is that it took price controls to achieve that recovery and, if theyre removed, California still faces deregulationthe failed plan that wreaked havoc with the states economy and way of life. The Federal Energy Regulatory Commission must decide by September whether to lift those wholesale price caps. If that happens, California could be plunged into the morass again, even as it struggles to pay off the billions it spent last year to keep the lights on.

"Legally, the structures are still in place for this to happen again," said Eric Wolfe, communications director, Local 1245, Walnut Creek, whose members work for one of Californias largest utilities, Pacific Gas and Electric, now under bankruptcy protection. "Weve taken some corrective measures but the market is still sitting there like a slumbering beast that we hope weve tamed. No one knows for sure if the fight has gone out of the beast."

The legacy of Californias clash with an open market lingers as consumers pay approximately 40 percent higher residential power rates and Local 1245 members continue on an uncharted pathnegotiating with a bankrupt employer whose decisions must be cleared with a bankruptcy judge.

A Year in Review

Californias energy crisis began in mid-2000, when wholesale rates climbed dramatically, in part because of market manipulation by Enron and possibly other energy companies. Because retail rates were capped, the states private utilities were plunged into crippling debt, and by February 2001 the state was forced to begin buying power on behalf of the utilities. California Gov. Gray Davis then began negotiating long-term power contracts, consumers dramatically reduced their use of electricity, state officials began investigating power providers, and federal regulators finally imposed wholesale price caps. All of this helped tame the market by last summer, but not before consumer rates were hiked and PG&E filed bankruptcy.

IBEW locals and their allies in the Coalition of Utility Employees (CUE), meanwhile, successfully petitioned the California Public Utilities Commission to prohibit utility layoffs that would affect service. In the fall of 2001, Local 1245 successfully campaigned against two ballot measures to municipalize electric power in San Francisco, measures that threatened to displace thousands of members.

The Road Ahead

PG&E Corp. has put forward an ambitious plan to reorganize itself, exit bankruptcy, and resume buying power for its customers by the end of the year. That reorganization plan would create three new, federally regulated companies for generation, electric transmission and gas transmission, while keeping gas and electric distribution as a state-regulated utility. Local 1245 has endorsed the PG&E plan over a rival plan put forward by the California Public Utilities Commission, which the union fears could harm employees retirement savings by depressing the value of PG&E stock.

Business Manager Perry Zimmerman has pointed out that many employees and retirees are depending on that stock for their retirement security.

For the workers who were on the front line during the darkest moments of Californias deregulation crisis, scars remain.

"Public hostility toward utility workers or anybody associated with the utility industry made it a tough year for our members, who were not in any way responsible for the crisis and in fact worked extremely hard to keep the power on and safe and reliable," Wolfe said. "A less well-trained, dedicated work force could easily have walked away from this problem. Our folks have stuck it out and the union has worked hard to protect job security during this period."

It is in this atmosphere that Local 1245 will begin bargaining with PG&E for a new labor agreement. Preliminary meetings between the local and PG&E are already taking place, with pensions and retiree health benefits figuring as primary bargaining issues.

Wolfe said plenty of common ground between the two sides exists as a foundation for negotiations. "PG&E understands Local 1245 has been an enormously valuable ally throughout the energy crisis. The union recognizes that we need the company to succeed if our members are going to do well."

Local 1245 members are hoping to have a new contract ratified by the end of the year.

Despite their wild ride with deregulation, Local 1245 members will keep doing their jobs.

"The underlying reality hasnt changed," Wolfe said. "The state and national economy need a reliable electric infrastructure and our members are the people who can deliver it."