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Politics : A US National Health Care System? -- Ignore unavailable to you. Want to Upgrade?

To: TimF who wrote (336)	1/20/2005 9:03:55 PM
From: fresc	Read Replies (2) \| Respond to of 42652

The AFL-CIO Executive Council California is embroiled in a major energy crisis caused by a failed electricity deregulation scheme. The crisis is imposing unacceptable conditions and costs on working families, businesses, and communities. Last summer, California wholesale electricity prices began to sky-rocket, sometimes reaching ten times comparable rates from a year earlier. Retail customers in San Diego, which was furthest along in the deregulation process, saw their electricity bills increase by 200 percent. The state's two largest utilities have accumulated $12 billion in debt, bringing them to the brink of bankruptcy. The state has been roiled by power black-outs, and without an extreme power conservation effort, much larger disruptions are anticipated this summer. High energy costs and unreliable power threaten the future of California's high-tech industrial base, and the crisis is spilling over into other states by driving up electricity costs across the West—triggering shutdowns of mines, sawmills, and aluminum smelters, which have caused significant job loss. State efforts to maintain electricity delivery are draining the state budget surplus at the rate of approximately $40 million a day. This places an additional burden on taxpayers and may limit the expansion of public service programs. If the electric utilities go bankrupt, more jobs will be lost. California employee pensions, as well as workers' 401(K) funds, risk losing millions of dollars which have been invested in utility stocks. California's crisis is primarily due to inadequate generating capacity, and this shortage is the result of the removal of the regulatory regime that would have been responsible for assuring adequate supplies of power. This underlying problem has been aggravated by the creation of a centralized wholesale power exchange which large, out-of-state power generating companies have learned to game by withholding power to force price surges. Unprecedented increases in deregulated natural gas prices have also contributed to California's energy woes. For over 65 years, the North American electric power system has been the safest, most reliable, and the lowest-cost producer of electricity in the world. The California crisis confirms the AFL-CIO's primary concern, that electricity restructuring will destabilize the national power system, undermine supply reliability, and dramatically increase prices. California's experience exemplifies the pitfalls of electricity restructuring and underlines the foolhardiness of trusting this most essential industry to flawed market mechanisms