View Full Version : Arnold may repeat Davis' mistakes

10-11-2003, 02:03 AM
IBEW Energy News Update

If Governor-elect Arnold Schwarzenegger follows through on his announced plan to terminate the California Power Authority, he will be signaling his intention to re-launch electric deregulation in the state.
The legislature created the California Power Authority during the 2000-2001 energy crisis in an effort to regain control over the state’s power supplies after mercenary energy companies manipulated power markets to siphon billions of dollars out of the state. Before the dust had settled Pacific Gas & Electric Co. was in bankruptcy and California consumers found themselves facing a decade of elevated electric bills to pay off high-cost power contracts.
The legislature gave the California Power Authority $5 billion in bonding authority to promote conservation and to finance the construction of power plants in order to protect consumers against future shortages-whether real or manufactured.
Schwarzenegger wants to shut the Power Authority down.
“(The authority’s) current mission to build and operate publicly-owned power plants is in direct competition with private industry and only serves to divert private investment in electricity generation and transmission away from the state,” according to a statement issued by Schwarzenegger during his campaign.
Schwarzenegger said utilities should be required to maintain electricity reserves.
Proceedings are underway at the California Public Utilities Commission to address how much power utilities should line up in future years, including reserves, and how the costs should be borne. A final decision is expected by the end of the year.
Gary Ackerman, spokesman for the Western Power Trading Forum, says Schwarzenegger will push for “direct access,” according to Dow Jones Newswires. Direct access is a key feature of the failed deregulation experiment launched during the administration of former Gov. Pete Wilson. A so-called core/non-core market, whereby larger customers can choose their suppliers and residential customers stay with utilities, is the most likely model, Ackerman told Dow Jones.
Critics of deregulation warn that direct access threatens to be little more than a vehicle for giving large corporate energy consumers access to the cheapest sources of power while sticking ratepayers with higher-cost sources of power.
Schwarzenegger could not revive direct access on his own. But as governor he will have the power to change the composition of the California Public Utilities Commission over time and appoint commissioners who favor deregulation.
Critics warn his plan would merely repackage much of the state’s failed deregulation law.
“I give his plans a grade of ‘F’. Arnold would impose a failed policy on us. It’s dangerous for our economy,” Loretta Lynch, former president of the California Public Utilities Commission, told Reuters just prior to the Oct. 7 election.
Schwarzenegger’s plan says utilities should derive 20% of their total power supplies from renewable sources by 2010-seven years earlier than current law requires. That figure should hit 33% by 2020, according to Schwarzenegger’s plan.
In addition, California should encourage investments in natural gas transmission and look into building facilities for importing liquefied natural gas, the Gov.-elect’s web statement said.

This is akin to one dog watching another run out under a car and get killed, then that dog running under the next car to come along...

Arnold! Learn from other peoples mistakes! :yell: