Subject: FYI - Article on PUC taking away direct access.
From: [email-masked]
Cc: [email-masked], [email-masked]
Date: Fri, 21 Sep 2001 17:05:27 -0700 (PDT)

As you may know, the PUC suspended direct access yesterday but did not do so
retroactively.  With the 2001 legislative session now over with little
resolved, our attention and advocacy will increasing go the PUC.  See below.
Justin

California Takes Step to Reregulate Power
By REUTERS
AN FRANCISCO, Sept 20 (Reuters) ? State utility regulators revoked the right
of Californians to choose their power provider today, tossing out the
centerpiece of the state's failed effort to deregulate its electricity
industry.
The California Public Utilities Commission voted 3 to 2 to immediately
suspend consumers' direct access to independent power retailers.
The move makes it easier for the state to use revenue from retail power
sales to finance a record $12.5 billion bond issue this year.
The department was chosen in January to secure electricity for most of
California's 34 million residents after soaring wholesale power prices
drained the state's two biggest utilities of their cash and credit.
"Direct access is one half of a failed and collapsed deregulation project,"
a commissioner, Carl Wood, said today. Mr. Wood said the other half of the
problem was the law's retail rate cap, which blocked utilities from passing
on the cost of power to customers, incorrectly assuming wholesale prices
would fall.
When energy supplies tightened and prices soared, the state's largest
utility, Pacific Gas and Electric Company , a unit of PG&E Corporation , and
Edison International 's Southern California Edison had to absorb $13 billion
in unanticipated costs.
Direct access was never a big hit.
Despite an $80 million advertising and public relations campaign to educate
Californians about deregulation and retail choice, most customers stayed
with their local utilities.
Big businesses and industrial customers, however, made deals with energy
companies for cheap bulk power and wanted them to continue.
The utility commission estimated that 5 percent of the state's peak
electricity demand of 46,000 megawatts is in direct access contracts. About
10,000 businesses that signed new deals this summer, when wholesale power
prices dropped, will be able to keep their contracts.