The San Diego Union-Tribune
State consumer groups — several of which continue to work on plans to overturn electricity deregulation through a ballot initiative — will be in no mood to compromise when they discuss the crisis today with Gov. Gray Davis and executives of the state’s biggest utilities.
With their proposals to deal with the crisis getting a tepid reception from state officials, the groups are bristling over the fast-track consideration that has been given to rate-increase proposals from Pacific Gas & Electric and Southern California Edison.
The utilities say they need the increases because they can no longer finance the shortfall between what they pay for power and what they are collecting from customers.
San Diego Gas & Electric also says it needs more money to cover a similar shortfall, though it was not invited to today’s session.
The consumer groups, meanwhile, were left out of settlement talks hosted by federal officials between electricity providers and state utilities in Washington, D.C. What Davis, who will plug into the San Francisco meeting by phone, and the utility executives are likely to hear today is unanimity from the advocates on a key point: opposition to rate increases.
“All of the consumer groups agree there should be no bailout of utilities who got into all this to make a profit,” said Harry Snyder, senior advocate for Consumers Union. “I don’t see this as a negotiating session. I see it as a session where we try to flush out each other’s positions.”
Harvey Rosenfield of the Foundation for Taxpayer and Consumer Rights in Santa Monica also characterized the governor’s recent support for at least some rate increases as a “cave-in” to pressure from utility companies.
“I’m not going to discuss a rate increase in any form,” said Rosenfield, who is among those at work on a ballot initiative for the 2002 election to overturn deregulation. “If these companies need money, they should get it from the market or their parent companies.”
Mindy Spatt, spokeswoman for The Utility Reform Network, said there is concern that talks with consumer groups may be a sideshow, while the focus is pushing through rate increases for the utilities.
TURN has argued that utility losses for buying power have been exaggerated by the failure to consider profits that the utilities’ parent companies made by selling power. The group documented these offsetting profits in a study it published in the fall.
That said, some advocates said they will consider higher payments if they are part of a move to a public takeover of the utilities.
“The utilities have a cash crisis and I have no problem advancing them cash — with the expectation that the cash will be paid back with a transfer of assets to the public,” said Michael Shames, the executive director of San Diego-based Utility Consumers’ Action Network, who will hook into the meeting by telephone.
“The question is what do the utilities have to give in exchange for rate relief?”