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		 Subject: Riverside Press-Enterprise: Power industry feels state's grip tig 
htening


Here's another direct access-related from the Riverside Press-Enterprise.

********************************
> Power industry feels state's grip tightening
> Deregulation's hallmark right to choose a new power provider may disappear
> today.
> 
> BY ROBERT T. GARRETT
> THE PRESS-ENTERPRISE
> SACRAMENTO
> 
> Only a year or two after California lunged to the head of the pack in
> deregulating electricity, the state now seems headed in virtually the
> opposite direction: Government is in the driver's seat. 
> 
> By summer's end, the state may end up with more control of the electric
> industry than was true for several decades before a flawed deregulation
> plan was passed in 1996. 
> 
> Today, for example, the state Public Utilities Commission is expected to
> put an end to what was supposed to be a hallmark of the 1996 law -- the
> ability of residential and business customers to shop for a new
> electricity provider. 
> 
> In August, a new state Consumer Power and Conservation Financing Authority
> comes into being. It will be able to borrow $5 billion to build or
> subsidize new power plants, make old ones cleaner and more efficient, and
> help homeowners and small businesses take energy-saving steps. 
> 
> At a Senate hearing Wednesday on the future shape of the electricity
> market, Democratic lawmakers, aides to Gov. Davis and consumer advocates
> spoke favorably of a strong state role in planning and coordinating the
> generation and transmission of electricity. 
> 
> "Never again will we embrace the free market," said David Freeman, Davis'
> leading energy adviser. ". . . We want something of a hybrid, (with)
> government restraints on market forces." 
> 
> But state Chamber of Commerce lobbyist Dominic DeMare said businesses fear
> policymakers are about to trample innovation and consumer choice. 
> 
> Also, the chamber's members want "the state out of the business of
> procuring electricity," he said. 
> 
> In January, the state began buying power for customers of California's
> three investor-owned utilities, which had been caught between soaring
> wholesale prices and capped retail prices. The state has signed $43
> billion in long-term contracts. 
> 
> But many witnesses at the Senate Energy Committee hearing extolled a
> greater role for the state than simply the buyer of last resort. 
> 
> Lenny Goldberg, a lobbyist for The Utility Reform Network, a consumer
> group, said the state should work toward permanent price caps on wholesale
> power, public ownership of all transmission lines, and regulation of
> retail prices that shields residents and small businesses from gyrating
> prices. 
> 
> Freeman, a long-time advocate of public power, said the long-term
> contracts and new state authority will help ensure a comfortable cushion
> of supply. "Then we can permit market forces . . . to play a vigorous
> role," he said. 
> 
> Sen. Debra Bowen, D-Marina del Rey, suggested the state should make sure
> its electricity supply always exceeds demand by 15 percent or more. 
> 
> Bowen said the price of building the extra generation could be considered
> insurance against blackouts and be spread across all customers in the
> state. 
> 
> The chamber's DeMare said he would prefer to leave decisions about new
> generation to the free market. 
> 
> "But are you willing to live with the results if the market does not come
> up with adequate supply," Bowen asked. "You can't have it both ways." 
> 
> Stuart Wilson, assistant executive director of the California Municipal
> Utilities Association, warned that the state may bite off more than it can
> handle in trying to be a major power buyer, a regulator and a subsidizer
> of new power plants. 
> 
> "It's pretty complicated right now, and it's getting more complicated,"
> Wilson said. ". . . We think it's pretty fraught with difficulty." 
> 
> Robert T. Garrett can be reached at (916) 445-9973 or by e-mail at
> rtgarrett@pe.com. 
> Published 6/28/2001
> 
>