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Pastimes : Clown-Free Zone... sorry, no clowns allowed
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To: pater tenebrarum who wrote (57015)1/11/2001 2:04:44 PM
From: Ilaine  Read Replies (1) of 436258
 
The rate cap appears to be a concession to the power producers that sell to the two utilities which provide electricity directly to the consumer, in return for forebearance on the producers receiving payment from the utilities any time soon. So the cap doesn't favor the utilities, it favors the producers. The expectation is that the real wholesale price will drop quite a bit in the future - I think the usual rate is around 2 cents per kilowatt hour, so five and a half cents is a good deal for the producers.

It's the two utilities, Pacific Gas and Electric, and California Edison, that are in danger of default and bankruptcy.

These wild prices will end when there is more production or less demand.
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