If interested in the timeline of deregulation activities
in California read on, otherwise please delete...dsg

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January 20, 2001

Anatomy of a Jolt

A timeline of key events in California utility
deregulation

1993 The California Public Utilities Commission's division
of strategic planning publishes the "yellow book"
exploring how the state might deregulate its power market.

1994 The PUC issues an order, informally called the "blue
book," that officially initiates a study of power-industry
restructuring in California.

1995 The PUC issues an order stating that electric
customers in California should be able to choose their
power provider by 2003 and that some of the state's
largest investor-owned utilities should sell a portion of
their power plants and turn over their transmission lines
to an independent operator to facilitate competition.

1996 Gov. Pete Wilson signs Assembly Bill 1890 to open
California's electricity market to competition. The bill
calls for most customers to get the right to choose
electricity suppliers in 1998, mandates a 10% rate cut the
same year for small commercial and residential customers
and allows the three biggest investor-owned utilities in
the state to issue as much as $10 billion in bonds to
finance the transition from monopoly status to full
competition.

1997 Utilities begin taking steps to divest themselves of
power-generation plants. Southern California Edison, a
unit of Edison International, and Pacific Gas & Electric
announce the sale of 13 generation plants in line with the
PUC's divestiture policy.

1998
* Rates that utilities can charge consumers are capped
until the utilities complete the divestment, expected in
2002.
* Small commercial and residential customers of
California's investor-owned utilities begin receiving the
10% discount on their power rates mandated in AB 1890.
* The California Power Exchange and the California
Independent System Operator begin functioning.
* Utility customers who chose an alternative power
provider also receive their first deliveries through the
new provider.
* Californians vote no on Proposition 9, a ballot
initiative that would have prohibited the use of customer
revenue to finance the utilities' bonds.

1999 San Diego Gas & Electric, a unit of Sempra Energy,
becomes the first California utility to deregulate,
allowing it to lift the price cap. Within a year,
customers' bills triple as the utility passes on high
wholesale power costs.

2000
* May 22: The California Independent System Operator,
manager of the state power grid, declares the first of 36
Stage 2 alerts, when power reserves drop below 5%.
* June 15: Rolling blackouts in San Francisco affect
thousands. The blackouts are caused by slim power supplies
due to several Northern California power plants shut down
for maintenance.
* Aug. 2: California agencies are beset by major
electricity shortages. Gov. Gray Davis calls for
investigation into possible price manipulation in the
wholesale electricity market.
* Sept. 7: State regulators approve a plan for San Diego
customers that caps their rates for three years.
* Sept. 11: Federal probe of California power prices
begins.
* Oct. 31: Federal panel suggests California abolish a
mandatory-buy rule.
* Dec. 7: ISO declares first Stage 3 emergency as power
reserves fall below 1.5%. Conservation efforts avert
rolling blackouts.
* Dec 15: The Federal Energy Regulatory Commission
approves a flexible rate-cap plan, but allows power
suppliers to charge utilities more if they can prove a
higher price is warranted.
* Dec. 26: Southern California Edison sues FERC, alleging
the agency failed to ensure that wholesale electricity is
sold at reasonable rates.

2001:
* Jan. 4: State regulators approve emergency rate
increases of 7% to 15% for customers of SoCal Edison and
PG&E, who say they have lost billions of dollars because
they cannot pass on high wholesale costs to customers.
They later warn of bankruptcy and layoffs.
* Jan. 11: ISO declares Stage 3 alert, but stops short of
ordering blackouts. Energy Secretary Bill Richardson
extends emergency order requiring out-of-state companies
to sell power to California.
* Jan. 16: ISO declares Stage 3 alert as several plants
report a shortage of natural gas needed to operate. Edison
says it doesn't have the money to pay $596 million it owes
this week.
* Jan. 17: ISO orders the first rolling blackouts of
California's electricity crisis. The outages affect
several hundred thousand customers in northern and central
California. Gov. Gray Davis signs emergency order allowing
the state Department of Water Resources to buy power as
part of a plan to stave off the utilities' bankruptcy and
further blackouts.
* Jan. 18: California cuts off power to thousands of
people for a second straight day as lawmakers rushed to
enact emergency legislation to buy electricity at taxpayer
expense and keep the lights on.
* Jan. 19: State regulators slap California's two largest
utilities with an order barring them from cutting off
power to the 25 million people they serve. The lights were
expected to stay on through the weekend in California, but
the state order didn't completely erase the possibility of
more rolling blackouts ordered by managers of the state
power grid.

Source: The Wall Street Journal and Associated Press