OT: CA senate votes 30-0 to shaft themselves. If I were the CEO of a national power company I wouldn't waste my resources building new plants in California. If I had a choice as to who I sold spare power to, it would be the highest bidder, which most likely wouldn't be CA.
SACRAMENTO -- The California State Senate on Tuesday passed a bill that would cap electricity rates until the end of 2002 for San Diego consumers and small businesses suffering from high utility bills in the wake of deregulation.
The bill, which sailed by with a 30 to 0 vote, places a 6.5 cent-cap per kilowatt hour for ratepayers, putting the average bill for residential users at $68.
While it's almost double what users were paying before the electricity market was deregulated completely in San Diego, the cap is down from the 21-cents high passed on to customers by San Diego Gas & Electric, a unit of Sempra Energy (SRE: news, msgs).
The bill, authored by Sen. Dede Alpert, D-San Diego, and Assemblywoman Susan Davis, will affect residential, small commercial and street lighting customers of San Diego Gas & Electric. The rate cap is retroactive to June 1, 2000.
The cap also may be extended until the end of 2003, if the state Public Utilities Commission decides it would benefit the public.
"The people are just suffering," said Sen. Alpert. "This bill stops the pain."
If the rate cap results in a loss to the utility distributing the electricity, the commission shall use an "accounting procedure" to provide a "reasonable opportunity" to recoup the loss over time.
The bill also requires an investigation into San Diego Gas & Electric's purchases of electricity to see whether they were in the public interest. Any penalties arising from the investigation will be used to offset any losses sustained by the utility due to the rate cap.
Sempra spokesman Ed Van Herik said the company hopes for a "fair and reasonable" plan and it's "looking for recovery of the cost."
The bill could go before the State Assembly as early as Wednesday. Gov. Gray Davis is expected to sign it.
The cap should be reflected in October electric bills, Alpert said.
The bill, AB 265, bypasses and expands on a ruling last week by the commission that puts a more limited cap on rates.
The San Diego area is the first region in the market to have a fully-deregulated electricity market and has become a test case for the rest of the country as different states march toward deregulation. See related story.
San Diego's rate freeze was the first to end, last summer. The rest of California will follow by March 2002.
But strong demand for electricity fueled by a growing economy and hot weather put strains on supply, which hasn't grown in 10 years. As a result, electric bills have more than doubled. |
