AB 2006 Could End Up on Ballot

By Published On: August 21, 2004

As the debate over the ever-changing bill sponsored by Southern California Edison, AB 2006, to reregulate some of the energy market reached fever pitch, The Utility Reform Network said it would consider turning the measure into a voter initiative. ?We are hoping the bill passes but are looking at other options,? said TURN spokesperson Mindy Spatt. Spatt said she didn?t know whether a ballot initiative would be in coordination with Edison. ?They may do theirs and we may do ours,? she said. Edison spokesperson Gil Alexander said it was ?premature? for the utility to decide whether to pursue an initiative. ?We are focused on building a consensus on what can be accomplished this year to get power plants built,? he said. Using the initiative process for such an ?important and complex issue is totally irresponsible and would lead to significant problems,? Jan Smutny-Jones, Independent Energy Producers executive director, responded. He doesn?t want direct access to energy contracts by large customers flatly rejected, noting that direct access was not responsible for the wholesale market mess created by the 1996 deregulation law. Edison was unable to compete, he said, and now wants to dominate the generation sector. ?Edison generates political influence, not electrons,? he asserted. While the bill is still being reshaped by lawmakers, supporters and opponents began working to get the public on their respective sides. Edison has been running television ads promoting its version of the bill, which would allow a mix of utility-owned generation with competitively bid supplies. TURN held a press conference August 18 to criticize Governor Arnold Schwarzenegger?s opposition to the bill and his continuing support for allowing large energy users to work out their own energy deals. ?The majority of Californians don?t share the governor?s fantasy that deregulation will lower rates,? said Mike Florio, TURN senior attorney. ?Deregulation only created uncertainty and prevents the planning we need.? Democratic senator Dianne Feinstein also weighed in on the issue. She backs the bill by Assembly speaker Fabian N??ez (D-Los Angeles) as a means of ensuring stable and cost-effective electricity in California. A coalition of AB 2006 opponents, including the California Manufacturers & Technology Association, other business groups, and Calpine, started putting out radio ads this week, slamming the legislation as a ?blank-check bill.? Inside the state Capitol, N??ez fired off a letter to the governor laying out the legislation?s benefits, with the governor responding in kind, highlighting its faults. N??ez also took Schwarzenegger to task for letting the California Public Utilities Commission virtually develop the state?s energy policy. ?While the CPUC will play an important role in implementing [a state energy policy], it is the responsibility of the Legislature and the Administration to shape it,? the speaker wrote in his August 17 missive. The governor summed up his sentiments on AB 2006 the following day, saying it would lead to ?fewer choices, less growth, and more uncertainty.? AB 2006 underwent more amendments this week and is expected to be reworked again. The latest amendments include prohibiting closed-door settlements at the CPUC. Any contested deal before the commission that would cost ratepayers more than $10 million must be reviewed in a public hearing. In addition, the commission would be allowed to issue a utility a certificate of convenience and public necessity for a power project only after considering alternatives. The large customer rate discount was removed. The bill?s fate will be decided at the end of this month, perhaps by the end of next week. Senate president pro tem John Burton (D-San Francisco) plans to end the session August 27, which would allow his Republican colleagues to participate in the Republican national convention in New York City.

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