FYI.  Silicon Valley Manufacturing Group ain't happy about the rate increase 
(surprise).
----- Forwarded by Jeff Dasovich/NA/Enron on 05/10/2001 04:56 PM -----

	"Carla Reddick" <creddick@svmg.org>
	05/10/2001 04:44 PM
	Please respond to creddick
		 
		 To: <creddick@svmg.org>
		 cc: 
		 Subject: FW: PUC Rate Proposal Disaster!  Please call and fax PUC 
Commissioners Brown, Duque and Lynch (info below)

SVMG Member Companies:

We URGENTLY REQUEST YOUR SUPPORT in sending a strong message today and
tomorrow to the
PUC that the proposed rate proposal is unacceptable to SVMG employers, its
workers and families.   We have only until 6 pm this evening to submit
formal comments for the proposed rate structure just this morning. A brief
analysis is below.  Please call or fax the following Public Utilities
Commissioners IMMEDIATELY with our urgent message.  Please and let me know
if you and your organization have done so.

Also, don't forget to avail yourself of one last opportunity to directly
meet with the PUC at a public hearing regarding this rate proposal at the
Doubletree Hotel tomorrow (Friday May 12, 2001) at  3:00, 2050 Gateway
Place.  To participate you must arrive early and sign-in to speak.  A member
of the Public Advisor's Office will be there for assistance.  To get more
advice about participation at the hearing contact the PUC's Public Advisory
Office at 415-703-2782.

Thank you for your help at this critical time.

Justin Bradley
Director of Energy Programs
408 501 7852

*********************
Geoffrey Brown - Phone 415 703 1407; Fax 415 703 1294 (Perhaps the key swing
vote, most important focus of advocacy)

Henry M. Duque - Phone 415 703 3700; Fax 415 703 3352; (Historically on side
of business but needs encouragement)

Carl Wood - Phone 415 703 2440; Fax 415 703 2532  (Most anti-business voting
record; probably intractable)

President Loretta Lynch -  415 703 2444; Fax 415 703 1758 (Unlikely to
change vote from public stance but worth a try based on past relationships
and connection to Gov. Davis)

**************

The PUC unveiled their proposal with the following rate allocations:

Residential customers are protected with an average rate increase of 17%,
Small commercial users 45%
Large energy users up to from 50 to 75%.

This does not include the 1 cent rate increase proposed in January which
would increase the large energy users rate by 100%.  A fair and proportional
rate increase would be an average increase of 34% for all customers.
President Lynch admitted that this may not be enough, and that additional
rate increases could be required in the future.   In protecting the
residential rate classes, the PUC is shifting approximately $1 Billion from
the residential rates to all other customer classes.

It is important that we all SVMG member companies communicate to our PUC
Commissioners the danger of protecting residential rates where the use of
power is more discretionary and flexible than for employers.  Unfairly high
business rates decrease productive electricity use with subsequent loss of
goods and services and JOBS.  Protecting the residential rate class is bad
policy because it guts the incentive for many residents to conserve.

SVMG understands that prices must rise significantly to accommodate the cost
of electricity.  It is regrettable.  But any plan must be equitable and
proportional between all rate classes with no cross subsidization.

The SVMG press release form this morning is below.  The PUC release is in
the link below.

The PUC release.  http://www.cpuc.ca.gov/PUBLISHED/NEWS_RELEASE/6967.htm

***************
P.U.C. IS A.W.O.L. ON PROPOSED RATE INCREASE,S EFFECT ON THE ECONOMY AND
EFFORTS FOR RESIDENTIAL CONSERVATION


For Immediate Release:             Contact: Michelle Montague-Bruno
May 10, 2001                        (408) 501-7853

&The disproportional rate increases proposed by the PUC will devastate the
state and potentially the nation,s economy,8 said Carl Guardino, president
and CEO of the Silicon Valley Manufacturing Group, in response to
electricity rate increases being suggested by the Public Utilities
Commission (PUC) and its President Loretta Lynch.

The PUC president,s proposal has three critical flaws:
1.   It undermines the Governor and the Legislature,s conservation plan; which
already tilts heavily toward residential customers, because the PUC proposal
provides individuals with no incentives to conserve.
2.   It is devastating to California,s economy; which will cripple California
companies and every working family that depends on a healthy business
climate to maintain jobs.
3.   Coupled with the economic downturn California employers already face,
this Commission is either insensitive or ignorant to the further loss of
jobs this proposal could create.

&The PUC may think that by shielding residential customers from paying our
proportionate share that they are doing everyone a favor; yet it,s pretty
hard to pay your bills when a disproportionate plan forces your employer out
of business or out of California,8 said Guardino.

Yesterday, the PUC proposed raising rates for some employers by 50 to 75
percent, which would be the second increase handed to the industrial
business community this year.  For many employers, the recently proposed
rate increases will equate to a 100 percent increase in electric bills in
less than five months.

&This is irresponsible behavior at a time when the state,s economy is
already reeling from an economic downturn that has hurt employers and lost
jobs for working families,8 said Guardino.

&Many companies, including Roche Pharmaceuticals, have had very aggressive
energy reduction programs in place for several years, which will continue.
To further cut consumption - in order to pay for a non-proportional and
destructive rate increase -- for some employers, could mean cutting into
their workforce, or leaving the area all together,8 said Dr. James Woody,
President of Roche Pharmaceuticals R&D in Palo Alto and Chairman of the
Board of the Silicon Valley Manufacturing Group.  &We want to do our fair
share in paying for rate increases, but the disproportionate nature of this
proposal could be devastating to employers. We need a rate structure that
will allow employers to thrive and help pull us out of this economic
downturn.8

The Silicon Valley Manufacturing Group understands and acknowledges the need
to raise electric rates to help minimize blackouts, which will protect the
public,s health and safety.  However, to achieve desired conservation and
fairness, it is essential that all Californians share proportionally in rate
adjustments.

&Proportional rate increases should be implemented with no rate shifting
between classes of energy users.  Member companies of SVMG are committed to
being part of the solution, as we work together to conserve power, retain
our workforce and ensure a healthy economy,8 said Guardino.

&Apparently, the PUC is out of touch with working families, conservation or
jobs in California,8 said Guardino.  &It,s a naive proposal.  It assumes we
can put a firewall between working families and jobs their employers
provide; but instead this notion threatens the livelihoods of California
workers and businesses.8