To: Roads End who wrote (57856 ) 1/15/2001 10:50:10 AM From: flatsville Read Replies (1) | Respond to Riechers-->>"Charges of price-gouging are an infallible sign that the person making the accusation is an economic idiot."<< Maybe the real idiots are the one's who have bought the myth that this is truly a simple supply/demand situation...that the disfunctional CA market couldn't possibly have created the opportunity for gouging-type of behavior or that some might take advantage of it and act on it.<< latimes.com nctimes.com ...Political pressure for a solution is coming not just from the 34 million residents of California, but from the 14 states in the Western power grid, whose power companies now must bid against California utilities, allowing the power producers to carry on an escalating spiral of price gouging. California's clumsy deregulation of electricity has actually discouraged competition: By forcing utility companies to sell their power generators, the state gave away the store to the power producers, and by setting up a poorly planned, two-tier electric market consisting of the Power Exchange and the Independent System Operator, Sacramento established the ISO as a panic buyer of last resort. Only California has such a two-tier market. Most electricity is bought and sold on the Power Exchange. When last-minute shortages exist, utilities turn to the ISO, which can order some producers to sell electricity to prevent blackouts. When the Public Utilities Commission ruled that SDG&E cannot profit by buying large blocs of power months ahead of time, it took away any incentive for long-term planning by electric providers such as SDG&E. Through this and other actions, the PUC has handed electricity producers billions of dollars in excess profits by creating conditions that virtually guarantee a daily climate of panic buying. When the ISO lowered the price cap from $750 per megawatt hour to $250, the power producers responded by hiking the price for off-peak, nighttime power. So rather than gouge consumers during the heat of the day, when true shortages may exist, the power producers gouge us 24 hours a day, with nighttime rates more than 400 percent higher than they were just a year ago... seattletimes.nwsource.com ...City Council President Margaret Pageler said the changing market has upset what used to be a symbiotic relationship between Seattle and California utilities: Seattle would sell excess power during the summer, when demand here is lower. And California would sell to Seattle in the winter, when demand here peaks.
