Gino DiCaro

Backers of electricity re-regulation submit signatures

By Gino DiCaro, VP, Communications

Capitol Update, May 20, 2005 Share this on FacebookTweet thisEmail this to a friend

A labor-supported group called the "Alliance for a Better California" has submitted signatures for a ballot initiative that would prohibit new direct access (DA) and significantly hinder existing DA.

The so-called "Repeal of Electricity Deregulation and Blackout Prevention Act" prohibits new DA beginning in 2006, and subjects existing DA customers to more restrictive coming-and-going rules (between DA and bundled utility service) than the California Public Utility Commission's (CPUC) approved rules currently in place.

Energy service providers (ESPs) would be subject to more stringent requirements as well, a development that would inevitably have a chilling effect on ESPs' willingness to continue to do business in the California DA market.  They could be subject to price regulation by the CPUC, which undermines the centerpiece of DA and the reason why customers enter into DA contracts in the first place:  to cut their own deal, based on their own unique needs.

The Utility Reform Network (TURN), a residential consumer advocacy organization, is the main sponsor of the initiative.  They are unabashed opponents of customer choice and the ability of customers to choose a non-utility power supplier.  TURN was a key supporter of last year's AB 2006 (Fabian Nunez, D-Los Angeles) that would have sharply limited DA beginning in 2006.  CMTA was strongly opposed.  The bill was vetoed by Governor Arnold Schwarzenegger.

The initiative includes most of the language in AB 2006, including provisions relating to utility cost recovery and utility renewable portfolio standard requirements.

The initiative proponents claim that it would prevent another energy crisis and blackouts in California, when in fact it would only serve to destabilize the state's energy market just as the investor-owned utilities are getting back full swing into the energy procurement business.  The uncertainty caused by the initiative will hinder new investment in energy infrastructure just when it is needed most.

The timing of the election will be decided by Governor Schwarzenegger, who has until June 13th to decide whether to have a special election in November.  If the Governor doesn't call a special election, the initiative would be on the June 2006 statewide ballot.

Read more Energy articles

Capitol updates archive 989898989