---------------------- Forwarded by Ginger Dernehl/NA/Enron on 08/22/2000 
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	Joseph Alamo @ EES
	08/22/2000 11:38 AM
	
To: California Government Affairs, Paul Kaufman/PDX/ECT@ECT, Karen 
Denne/Corp/Enron@ENRON, Peggy Mahoney/HOU/EES@EES, Richard 
Shapiro/HOU/EES@EES, James D Steffes/HOU/EES@EES, Marcie 
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cc: Ginger Dernehl/NA/Enron@Enron, Lysa Akin/PDX/ECT@ECT, Marcia A 
Linton/NA/Enron@Enron 

Subject: SF Chronicle Article: Partial Electric Rate Freeze OKd for Hard-Hit 
San Diego/Critics say more relief needed for deregulation


Please note for your review the following news article which appeared in the 
August 22, 2000 edition of the San Francisco Chronicle:

[Ginger:  please also route/distribute to those whom you deem appropriate.  
Thanks!]

Joseph Alamo
Sr. Administrative Assistant
Government Affairs - The Americas
San Francisco CA

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This article was sent to you by someone who found it on SF Gate.
The original article can be found on SFGate.com here:
http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2000/08/22/M
N1901.DTL
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August 22, 2000 (SF Chronicle)
Partial Electric Rate Freeze OKd for Hard-Hit San Diego/Critics say more 
relief needed for deregulation
David Lazarus, Chronicle Staff Writer


   Responding to calls for action from Gov. Gray Davis, the California Public
Utilities Commission approved a limited rate freeze yesterday for
electricity users in San Diego, where power bills have skyrocketed in
recent months.
   However, the measure was harshly criticized by San Diego officials and
consumer activists as being an insufficient remedy for surging rates
resulting from deregulation of the state's electricity market.
   They are now looking for relief from legislators in Sacramento, who are
expected to vote today on a bill that would allow them to sidestep state
energy regulators and impose more extensive restrictions on how much San
Diegans can be charged for power.
   "I'm extremely, extremely disappointed," said San Diego County Supervisor
Dianne Jacob, who flew up for yesterday's PUC meeting in San Francisco
with other local officials.
   Former San Diego Mayor Maureen O'Connor urged California legislators to
scrap the state's electricity deregulation altogether. "To continue the
farce so that the whole state is under this terrorist economic endeavor is
just ridiculous," she said.
   O'Connor added that Bay Area ratepayers should be concerned about what
will happen when Pacific Gas and Electric Co. lifts a freeze on its own
electricity rates, perhaps as soon as next summer.
   "We already have the train wreck in San Diego," she said. "It's coming
your way next."
   The PUC voted 3 to 2 to approve an immediate "bill stabilization plan"
ensuring that most residential customers using 500 kilowatt hours or less
in electricity would pay no more than $68 per month through Jan. 31, 2001.
Their bills would be capped at $75 a month for the remainder of next year.
   Business customers using no more than 1,500 kilowatt hours would have
their monthly bills capped at $220 until the end of January, subsequently
rising to $240 a month.
   Michael Shames, executive director of San Diego's Utility Consumers'
Action Network, acknowledged that the average residence uses 500 kilowatt
hours a month in juice, but said this figure is skewed by inclusion of
vacation homes, apartments, condominiums and other relatively low power
users.
   Many San Diego Gas & Electric customers use double the amount of power
stipulated in the PUC's rate cap, he said.
   The PUC's measure, Shames said, "does precious little for government,
schools, hospitals and businesses who are currently being hit hard by the
energy debacle." RESTAURANT'S BILL SOARS
   One San Diego business owner, Susan Bauman, said her restaurant used
30,000 kilowatt hours last month and that her monthly power bill doubled
to more than $10,000. For the entire year, she said, her electricity bills
will total more than $100,000.
   "The commission just doesn't get it," said Mike Florio, an attorney for
The Utility Reform Network, a San Francisco consumer group.
   The commission's vote was along party lines, with the three Republican
appointees -- Henry Duque, Richard Bilas and Josiah Neeper -- voting in
favor and Democratic appointees Loretta Lynch and Carl Wood dissenting.
   Lynch and Wood had favored an alternative measure that would have applied
the rate freeze to a greater number of customers. In speeches prior to the
vote, San Diego officials were unanimous in also supporting the more
extensive proposal.
   "We did take some action today," Lynch, the PUC president, said in an
interview afterward. "But clearly, this commission is not used to acting
on an emergency basis."
   A special PUC meeting was scheduled after the governor, taking heat for
the state's surging power costs, called on the commission to provide
relief for ratepayers in San Diego, the first California city to feel the
full effects of deregulation.
   Davis said yesterday that he would have preferred passage of the more
sweeping PUC alternative but hailed the approved measure as "clearly a
step forward."
   He reiterated his belief that electricity generators are gouging
consumers.
   Average San Diego power bills have more than doubled over the past four
months as the local utility passes along rising wholesale costs to
customers.
   Electricity generators are now being investigated by the PUC, the attorney
general's office and other authorities to determine if they are
manipulating prices as demand for juice far outstrips available supply.
LOBBYING BEGINS
   After yesterday's PUC vote, the San Diego officials who attended the
meeting, including four of five county supervisors and Mayor Susan
Golding, piled into cars and headed for Sacramento. They said they will
lobby legislators for passage of more far-reaching rate relief.
   "This is affecting the health, safety and welfare of everyone in our
service area," Golding said. "We need relief and we need it now."
   Earlier this month, the state Senate voted 28 to 0 to approve a plan to
roll back San Diego power rates to prederegulation levels. Passage of the
bill in the Assembly is now seen as more likely following the outcome of
the PUC meeting.
   Sen. Dede Alpert, D-San Diego, said yesterday that without additional
measures, local schools will be forced to pay about $45 million in
additional electricity costs using funds otherwise earmarked for
structural and academic improvements.

   E-mail David Lazarus at davidlaz@sfgate.com.
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Copyright 2000 SF Chronicle