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Pastimes : The California Energy Crisis - Information & Forum
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To: Daniel G. DeBusschere who wrote (787)8/1/2001 10:26:03 PM
From: Zeuspaul  Read Replies (1) of 1715
 
That's your unregulated government in action fella. It happened....

It happened but not the way you remember. The state stepped in after the utilities ran out of dollars. Prices were out of control before the state started purchasing power.

Other states have had a favorable response to deregulated utilities

For several years....so did California.

Economists and the Governor both agree that California deregulation was fatally flawed when the end user was isolated from the cost of supply.

The Texas deregulation plan lowers and freezes end user prices just like the California plan did as do most deregulation plans.

San Diego county and parts of Orange County were not isolated from the cost of supply. For years they were in a direct market situation. End users paid market price for the juice. Prices dropped and everyone was happy. With supply greater than demand there was no incentive for the power producers to increase capacity. That's the way the market works.....Econ 101. Then the supply demand curve shifted and the prices went through the roof. End users cut back on their use....many went out of business. That's the way markets work....Econ 101. Power costs had tripled for market juice and still the power producers did not respond by increasing supply.....Profits 101.

Zeuspaul
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