Consumer Group: Electricity Crisis Is Actually Utility Profiteering

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City News Service

The threat of rolling blackouts is masking the deregulated energy industry’s attempts to manipulate electricity supplies to

increase profits, a consumer advocacy group charged today.

A representative of Santa Monica-based Foundation for Taxpayer and Consumer Rights said the problem began in 1996, when then-Gov. Pete Wilson and the Legislature passed the electricity deregulation law.

Harvey Rosenfield also said if utility companies have their way, utility rates in Southern California — now frozen — will increase by hundreds of dollars a month almost immediately.

”The disastrous deregulation law hit San Diego last summer, where utility bills went up 300 percent,” Rosenfield said. ”Now it has hit the rest of the state.”

”It’s blackouts now. Soon, it will be $200-a-month electric bills. We can’t afford to have our public health and safety and our economy in the hands of energy conglomerates whose only interest is in achieving record profits by manipulating the supply of electricity …. (If state lawmakers) don’t act, there’ll be a ratepayer revolt at the ballot box.”

Rosenfield said he wants the state to reassume control of electricity production in the state.

His comments came after a week in which Californians were urged not to turn on holiday lights until after 8 p.m., and to keep thermostats at 55 degrees when out of the house.

And last night, officials declared California’s first-ever Stage 3 power emergency. The alert lasted about two hours, according to the Los Angeles Times.

Department of Water and Power customers were unaffected by the power alert.

Shortages come about as various powerplants in the state shut down for scheduled and unscheduled maintenance. Rosenfield accused utilities of arbitrarily shutting plants down to keep demand for power at high levels.

Rob Schlichting of the California Energy Commission said ”we’ve heard that allegation.”

”The Public Utilities Commission and the California Independent Systems Operator” — a non-profit group that manages the power 75 percent of the state’s power grid — ”have been checking power plants to see if they are off for legitimate reasons.”

Schlichting said ”deregulation is not working as anyone envisioned it would.”

He said the commission, an entity of the state focused on long-term planning for energy needs, has ”three ways to get out of the power crunch.”

It can license more power plants to boost supply, he said, cultivate energy efficiency to reduce demand or ”try to make deregulation and the marketplace work as intended.”

Consumer Watchdog
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