In his State of the State address on Jan. 8, California Governor Gray Davis declared his states experiment in electricity deregulation “a colossal and dangerous failure,” and proposed a wide-ranging plan to repair the system, including a variety of state controls over power-plant operators and utilities, stepped up conservation efforts, and a call for new state authority to buy and build new plants to generate power.
The governor announced that he would set aside $1 billion in his budget to help stabilize the supply and price of electricity in the present and help provide new power generation to meet the demands of the future. His top legislative priorities to solve the crisis include:
- Overhauling the bidding process for electricity, which currently guarantees that each generator is paid according to the highest bid;
- Streamlining the process for utilities to enter into low-cost, long-term contracts for electricity and then apply pressure to the out-of-state generators to supply that power;
- Providing state regulatory agencies with mandatory authority to order any functioning generating facility down for “unscheduled maintenance” to go back on line;
- Giving the Public Utilities Commission fifty new inspectors to monitor any facility suspected of deliberately withholding power from the grid;
- Making it a criminal act to deliberately withhold power from the grid, resulting in imminent threat to public health or safety;
- Expanding the authority available to the governor under a state of emergency in the event of imminent power outages;
- Providing $4 million to the state attorney general to investigate and prosecute possible racketeering, market manipulation, price fixing, and other potential violations by merchant generators;
- Repealing the law that allows the three major utilities to sell their remaining generating facilities;
- Requiring municipal utilities to sell their excess power to California consumers at reasonable rates;
- Investing $250 million in conservation efforts that would include proposing cash incentives for replacing inefficient refrigerators, washers and air conditioners with more efficient models;
- Developing a comprehensive campaign to create energy smart schools, homes, workplaces, and communities;
- Offering low-interest financing for new peaking facilities and the “re-powering” of existing ones to make them cleaner and up to 40 percent more efficient; and
- Committing state-owned lands for the siting of generating plants on the condition that the energy be distributed in California.
For more information, visit Gov. Daviss homepage.
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