To: Raymond Duray who wrote (441 ) 6/12/2001 12:23:19 AM From: gamesmistress Read Replies (3) | Respond to Re: A.B. 1890 and electricity pricing: cost plus does provide stability and predictable income; however, what incentive does it give to restrain those costs? Another feature of A. B. 1890 was payment to the utilities for all the money they had sunk in projects like abandoned nuclear plants. The tradeoff for the consumer was supposed to be mandatory rate cuts starting in 2001 or 2002. Well, we all know how THAT worked out. What I see clearly is that the continuance of wise contract law and the enforcement thereof is the bedrock of our society. There must be a fair exchange, and a stable one for the economy to work. www0.mercurycenter.com But IMO stability is best attained not by the government dictating "a fair profit" but leveling the playing field for competition and ensuring that consumers can get the information they need to make rational decisions. (And by consumers I mean not just individuals but businesses and municipal governments). The CA state government was trying to game the system themselves with A. B. 1890, putting in "something for everyone" to get the bill passed, trying to set prices by fiat...lots of luck.So let me flip the question to you. If the absence of a "cost-plus" price for electricity means that the California economy is sent into recession and thousands of businesses and tens of thousands of households go BK, have we achieved a good result?
