The Associated Press
The Foundation for Taxpayer and Consumer Rights announced Monday it would lobby state senators and assembly members to oppose the bill that would allow the cash-strapped utility to issue more than $2 billion in bonds.
The Assembly Energy Costs and Availability Committee debated the bill Monday but adjourned without voting on the bill. The committee was expected to take the bill up again Tuesday.
But any deal that put the financial responsibility on the shoulders of taxpayers was unacceptable, said Harvey Rosenfield, president of the Foundation for Taxpayer and Consumer Rights.
If the bill passes, the consumer group said it will try to reverse it with a statewide ballot initiative. The group also plans to target lawmakers who supported it.
“We will hold lawmakers responsible,” Rosenfield said.
As part of its fight, the group established a 24-hour “war room” to coordinate a volunteer-based lobbying effort during the final weeks of the session. Sheets of paper bearing the names of the state’s senators and assembly members were tacked to the wall at the group’s temporary headquarters where they planned to keep score.
Meanwhile, nearly half of the state’s voters believe legislation to rescue Edison is likely to make matters worse and the state would be better off not getting involved, according to a poll paid for by three power generators – Mirant Corp., Dynegy Inc. and Reliant Energy Inc. – operating in the state.
Nearly one-third of those polled said they would be somewhat less likely to reelect Assembly members who supported a rescue plan, according to the poll, which was conducted by San Francisco-based David Binder Research and sampled 1,200 voters. It had a margin of error of less than 3 percent.
California’s three largest utilities have amassed billions of dollars in debts since last year when wholesale electricity prices soared and were prevented by state regulators from passing on the sky-high costs to customers. This left Edison owing $3.9 billion.
Gov. Gray Davis announced in April he had negotiated a deal with Edison to keep it from following Pacific Gas and Electric Co. into bankruptcy. The deal included the state’s purchase of the utility’s transmission system for $2.76 billion to help Edison reduce its debts of $3.9 billion.
The bill by Sen. Richard Polanco, D-Los Angeles, altered that plan to allow the utility to issue $2.5 billion in bonds and reduced the transmission sale to an option.
The biggest sticking point the utility had with the deal was the state’s five-year option to purchase Edison‘s transmission lines. Edison says that option needs to be for fair market value. The plan currently calls for an option to buy the lines at net book value.
The Assembly plan would let Edison issue $2.9 billion in bonds, which would have to be spent on debts owed alternative power producers, banks and commercial debt holders. Edison‘s remaining $1 billion in debt would be owed to power generators and marketers.
At issue still was which Edison customers would repay the bonds. The Senate version called for commercial and industrial users, with electric loads above 500 kilowatt hours, amounting to about 1,500 customers.
The Assembly plan spreads that burden among customers whose electric load is 20 kilowatt hours, which still avoids residential customers.