CapitolWeek transcript
Energy Summit #5 4/27/01
((Jack))
Thanks for joining us.
Time is of essence in this our 5th energy
summit. Less than 35 days remain until
peak summer usage begins.
((Melissa))
And is any real relief, courageous leadership, or otherwise,
on the horizon?
We’ll ask our panel shortly.
((Jack))
First, where we stand today…
The state is spending an average of 73 million dollars a day
to keep the lights on—more than 5 billion so far this year…
A Stanford study estimates if nothing is done energy prices
this summer could climb as high as 750 dollars a megawatt an hour, compared to
last year’s rate of 12 dollars an hour.
And late last night the Federal Energy Regulatory Commission
or FERC approved price caps when supplies fall below 7.5 percent.
U.S. Senator Diane Feinstein has introduced a federal price
capping measure for Western states.
((Melissa))
Governor Gray Davis hopes cooperation on many levels
will help the state avoid worst case scenarios this summer…
Cooperation he is glad includes federal price caps that
limit what power generators could charge at all times-not just during stage
three emergencies as the federal energy regulatory commission or FERC proposed…
He’s calling for all of us to conserve 10 percent, down from
his original request of 20,
And while he believes the state should always try and
negotiate the best rates, setting an arbitrary price ceiling is not always
possible…
((Jack))
The Governor also announced a new team including Ambassador
Richard Sklar that will further streamline the process of getting more power
online.
Joining us now,
Steve Maviglio with the Governor’s Press Office,
Democrat Assemblyman Joe Canciamilla who’s part of a group
pushing an alternative plan for Southern Cal Edison,
Republican State Senator and Energy Committee member Jim
Battin,
((Melissa))
Gary Ackerman with the Western Power Trading Forum that
represents 30 in and out of state generators.
And Lenny Goldberg, with the Utility Reform Network
Steve, we’ll start with you. On the surface, what FERC announced seems like a pretty good
deal, and it seems like what many people have been asking for. Is that the case?
((Steve
Maviglio, Governor’s Press Secretary))
Well, you have to dig a little deeper. FERC has refused to regulate prices,
period. Their ideologues tie to making
deregulation work. We’ve proven here in
California that it’s not working. The
FERC action is just a fig leaf. It
doesn’t really offer any relief to California.
Only at certain times. Less that
ten percent of the energy we buy.
There’s going to be nothing to put the brakes on what the generators are
going to charge, and it went way beyond the $750.00 you mentioned today.
((Jack))
Is that the consensus among this group? That it’s just window dressing?
((Gary
Ackerman, Western Power Trading Forum))
Well, I don’t think it’s window dressing. We do need to dig into the details a little
bit, but it does provide some limitations on last minute purchases, and it’s
been those last minute purchases that the ISO has had to purchase from all
across the region that have gone up so much in price. Last summer, they went up for a few hours, twelve-hundred dollars
a megawatt hour, fifteen-hundred dollars a megawatt hour. Under FERC’s proposal, that will not happen.
((Jack))
The California energy market is probably the biggest energy
market in the country. I would assume
that’s what it would be. I mean, it’s
the biggest place where you’re going to sell power, right?
((Gary
Ackerman, Western Power Trading Forum))
Well, if was the second biggest, I doubt it would change
what you’re going to say, right?
((Jack))
Well—
((Gary
Ackerman, Western Power Trading Forum))
It is the second biggest.
((Jack))
What I’m going to say next is, why can’t the state of
California impose it’s own price caps by saying, “Look, if the federal
government will not cap the price of power, we’re the people who are paying for
this. We refuse to pay more than X
number of dollars.” What’s wrong with
that?
((Melissa))
And don’t we have control, maybe not for some markets, but
for the municipalities to set some caps?
((Lenny
Goldberg, The Utility Reform Network))
Well, your suggestion is a good one, and a number of
consumer organizations have said that.
The problem is that you have to be willing to put up with blackouts if
you do that because—
((Jack))
But, Lenny, we’re already experiencing blackouts.
((Lenny
Goldberg, The Utility Reform Network))
Well, we’ve had a couple of them. One of them had to do with a lack of payment by the QFs. Earlier ones this summer, there were plants
down; there was no reason for blackouts, but when you have a supply shortage,
unless you can get the public to act really strongly in demand—and we don’t
know if we have that capability yet—you have to say, “We’re not paying the price
even though that may mean blackouts.”
Now, that may be a price. Now,
that may be a price if we can organize it and control it, consumers and
Californians may be willing to pay, but the generators have us so tightly that
we’re not in a position to negotiate.
They just have control of the market.
((Senator
Jim Battin, [R] La Quinta))
Let me just make two points here, Lenny, and let’s not
forget that we’re talking about the entire state of California, and that
includes people in the North, South, on the coast, and in the deserts. I represent the people who live in the
hottest areas of California, and you can not have blackouts that the state has
caused by going to the brink and saying, “We can’t afford to buy power now. You go sell power where it’s available,” and
let the people in the desert, where the temperature gets up to a hundred and
twenty degrees, have the air conditioning and lights go out. You know, you have people who are elderly
and frail and ill, and those people are going to die, and I’m afraid we’re
going to see that in my district this summer, and we’ve got a bill that we’ve
introduced in the legislature that says, “You cannot blackout areas where the
temperature is over a hundred and five degrees.”
((Jack))
But the ISO, the Independent System Operatives, the people
who run the grid, have already told us to expect thirty to thirty-four blackout
this year anyway?
((Senator
Jim Battin, [R] La Quinta))
Well, that’s exactly why I’ve introduced my bill, Jack. It’s a matter of making sure that people who
are vulnerable are protected. We have
to make some decisions, and they’re tough decisions. We have to decide if the people on the coastal regions get to
watch Oprah in the middle of the afternoon or if the people in the desert
regions are going to get to survive, and that's really what it comes down to
for me. We have to decide as
legislators and policy makers of this state where our priorities lie. You know, if you look at history, just a few
years ago in Chicago, it only got to a hundred and four degrees. They had extended blackouts, and seven
hundred people died. I don’t want to
see that at a hundred twenty degrees in the Cochilla Valley and eastern San
Diego. I just don’t think it’s an
acceptable cost.
((Melissa))
So, Joe, what are the options here, and how do we put the
power back in the consumers’ hands, and what are your constituents saying?
((Assemblyman
Joe Canciamilla, [D] Pittsburg))
Whether there are other areas beyond just the residential
concerns. We’re clearly looking at the
question of gas prices, and we’re already seeing gas prices starting to rise,
and refineries are already very sensitive to outages, to natural gas prices,
and the potential exists, if a refinery goes down for twenty minutes, to take
two or three days to come back on line.
Having gone through refinery shutdowns in the past, it’s very clear that
if a refinery shuts down, before you leave work at the end of the day, the gas
prices are already starting to go up, and it takes an awful long time for those
to go down. So, we need to be prepared
in the event that we are going to see these outages this summer.
((Melissa))
Steve, the administration is facing increasing pressure
because many of the actions are not going to make a difference. They may by 2003 as the Governor has
suggested, but not this summer, and a lot of folks are really going to feel it
as the Senator said, especially in the desert areas. What is the feeling now? Is
there frustration? And what is pressure
now? Obviously, he doesn’t want his
efforts to be seen as a failure.
((Steve
Maviglio, Governor’s Press Secretary))
Well, we’re tackling this on a number of levels. Obviously, generation. We need to get as much power online as
quickly as we can with peaker plants for the long-term. We hope to get fifteen percent more power
than supply—the other way around, sorry—by the year 2004. The only way we’re going to get out of this
summer is with an aggressive conservation effort. The Governor has launched a couple of very bold initiatives. The twenty-twenty program, where you get a
20% rebate on your bill. Also, there
was a senate and assembly bill that put a record eight hundred billion dollars
into conservation programs. Those
things are on track for the summer.
((Melissa))
We’ve heard from viewers though that say, you know, “Hey
we’re on a limited income, we’ve been conserving forever, we turn every light
off. Our thermostat is at fifty-five;
how can we expect to make up an additional ten?”
((Lenny
Goldberg, The Utility Reform Network))
Well, our hope is that the PUC will continue to structure
rates in such a way that if you are a low user and of a low to moderate income
that you will avoid some of the serious impacts of those rate increases. So far, they are proposing multi-tiered rates
so that, even if you don’t get the benefit of the twenty-twenty, the impact
will not be so severe on low level users and moderate to low income
customers. We’re hopeful about that. There are no guarantees; we’re waiting to
see.
((Senator
Jim Battin, [R] La Quinta))
There are other ways of conserving as well. I know there are people, from my district
especially because price is so sensitive there, that conserve as part of their
life, but there are a lot of others that can conserve better, and then there
are a lot of other programs. Both of
these bills that Steve was just talking about do provide other incentives to
industry and government to lower the consumption of energy there. I mean, we’ve supported them. They’re smart to do. We need to put power on the grid any way we
can. Conservation is a very important
part of it.
((Jack))
I just want to cycle back to this issue of “just say
no. We will not pay any more.” What would be the reaction among the power
producers that you represent?
((Gary
Ackerman, Western Power Trading Forum))
We would be very supportive of that. We think it’s very rational for people to go
on an energy diet when there is not enough supply to go around. We don’t want to perpetrate a system where
there are blackouts. That makes no
sense to us. We grew up in an industry
where reliability was the—
((Jack))
Just so I understand, if the state of California said,
“Okay, we will only pay so much,” you’re telling me that the producers you
represent would say, “Okay, that’s what we’ll sell it for.”?
((Gary
Ackerman, Western Power Trading Forum))
We’ll come to some agreement. If you don’t want to pay the price that we consider a fair market
price, that must mean that we have somebody else who is willing to buy it at
that price.
((Lenny
Goldberg, The Utility Reform Network))
That’s the problem.
((Senator
Jim Battin, [R] La Quinta))
That’s the problem.
You have interstate commerce involved here, and so you have these
generators that are in California say, “Okay, fine. We’ll sell to Oregon.”
((Jack))
Yeah, but is the market for power in Oregon as big as it is
in California?
((Lenny
Goldberg, The Utility Reform Network))
Well, this is why the Federal Energy Regulatory has
completely abdicated its responsibility again, with a slight caveat that we
still haven’t looked at their last proposal, but we agree with Steve that it’s
not looking very good because there is a drought in the Northwest. Normally all of the West and California gets
a lot of power from hydropower in the Northwest. They didn’t get the rain this winter. The market is fundamentally broken in the West, and it’s not
because of California’s deregulation mess, although that certainly is a mess. It’s really because we have that drought and
shortage of supply, and we were really hoping that FERC would take a look at
that and say, “Gosh, it’s broken. We
need to do something about that,” but it doesn’t look like that’s going to
happen.
((Jack))
We have one major utility in California that has already
declared bankruptcy. Is it only a
matter of time before the other major utility, Edison, declares bankruptcy,
Joe?
((Assemblyman
Joe Canciamilla, [D] Pittsburg))
Well, that’s what they’re telling us. We’ve sat through negotiations of the MOU that
the Governor is negotiating—
((Jack))
Edison made it pretty clear. They said, “Don’t change this or we’ll go into bankruptcy.” And the legislature says, “Well, we’ve got
to change this.” So, does that mean
it’s going to happen?
((Assemblyman
Joe Canciamilla, [D] Pittsburg)
Well, we haven’t said that just yet. What we’ve done at the request of the
speaker is there’s a group that, for lack of a better term, has been called
“Plan B,” and our responsibility is to look at the Edison MOU, try to pull
together as much information as we can—
((Jack))
MOU being Memorandum
Of—
((Assemblyman
Joe Canciamilla, [D] Pittsburg)
Understanding.
Correct. It’s the rough outline
of an agreement with Southern California Edison. It’s not a bill; it’s not a finely printed contract, but to
provide the legislature with some options in the event that it doesn’t go
through.
((Jack))
Why, Steve, did PG&E not necessarily get the same deal
that Edison did?
((Steve
Maviglio, Governor’s Press Secretary))
Well, in fact, they did get the same deal. It was their management’s decision to walk
away from it and go into bankruptcy.
It’s had wide-ranging impacts on small power producers who aren’t
getting paid. It’s an uncertain future
with two to three years in court. They
made the wrong decision for the people of California, and I think that
hopefully the judge will set them straight.
((Jack))
The Edison deal was
structured so that rates would increase so the utility would avoid again
getting into the situation where it couldn’t pay for—
((Steve Maviglio, Governor’s Press Secretary))
Well, that’s just one
part of it.
((Jack))
That was not offered
to PG&E though, was it?
((Steve Maviglio, Governor’s Press Secretary))
Well, a similar deal
was made to PG&E, but the bill also gets more conservation lands for California. It allows us to buy their power at what it
costs to make it, cost-plus pricing.
It’s a very good deal for the state.
((Lenny Goldberg, The Utility Reform Network))
We think that the
Governor gave way too much in the MOU.
We’ve been working with him. We
helped set a framework for consumers on how to negotiate the MOU, and on every
point of contention, they gave it away to Edison. Very, very disappointing because we were hoping for a
constructive outcome here, and when we look at that, there’s nothing there for
consumers.
((Jack))
Let me ask you this
one question. If you have the biggest
utility in California already in bankruptcy and a second one very close to
bankruptcy, as the legislature, why try to come up with a solution to this
problem when it looks like it’ll be in the hands of the federal court?
((Senator Jim Battin, [R] La Quinta))
Well, I don’t know of
a single Republican who supports this plan.
We agree with TURN on this. It’s
a gigantic bailout for Southern California Edison. It does two things that really bother me a lot. Number one, it gives a guaranteed rate of
return of 11.6% on any capital costs, so then they say that we’re going to
spend three billion dollars to upgrade the transmission lines. Well, Edison says, “Hooray” to that because
they make three hundred and fifty million dollars profit. They want to do ten billion dollars because
they’d just make all that much more money.
I just think that’s wrong.
Second, we have, I believe, a very good case, and I think we should
investigate it, and the PUC is looking at it, as to how much money Southern
California Edison took from the ratepayers through the CTC for stranded assets
and took and put up billions of dollars up into their parent company. That money belongs to consumers because
Edison didn’t lose any money when they sold those power plants. That money, we believe, we can claw back
into bringing millions of dollars back.
Part of the MOU says we’ll drop our investigation. That’s wrong.
((Melissa))
As we look at which
utilities go into bankruptcy, we’re not looking at the bottom line issue which
is that we need more power generation in the state, and, Gary, in terms of the
debate over Edison and bankruptcy, does that affect your ballgame in terms of
power supplies and the immediate future this summer?
((Gary Ackerman, Western Power Trading Forum))
I don’t think it affects
the immediate future, and I do believe that the debate you’re witnessing here
sort of points to the problem that we see. There are very good arguments on both sides
of the case to either push Edison into bankruptcy, or they voluntarily go
into bankruptcy or not. We’re not
disputing those, but, you know, we’re pulling each other apart by arguing
this over, and I don’t believe that people truly understand the complexity
of these deals. They don’t have the
time; they don’t have the patient, and we as suppliers have really lost patience
in terms of not being paid and having to listen to this kind of debate. We’re asking too much of the legislature, I
believe, to approve something like this.
I think it would be a lot more organized and orderly if Edison did
go into bankruptcy. That’s why I supported
it when I was on your show.
((Jack))
Because you’re
dealing with one entity, the bankruptcy court, instead of the entire
legislature and all the politics.
((Gary Ackerman, Western Power Trading Forum))
Bottom line, you’re
right.
((Steve Maviglio, Governor’s Press Secretary))
But how can you say
that’s orderly? Two to four years in
court. Total uncertainty. No clue about what rates will be for
consumers. No clue about your
future. No one who has ever been
through a bankruptcy—
((Gary Ackerman, Western Power Trading Forum))
What clue do I have
today about the way it’s going now?
((Steve Maviglio,
Governor’s Press Secretary))
You have a plan in
front of you.
((Gary Ackerman, Western Power Trading Forum))
A plan that is not
going to get approved. What kind of a
plan—
((Steve Maviglio, Governor’s Press Secretary))
Well, you don’t know
that.
((Lenny Goldberg, The Utility Reform Network))
Well, we’re hopeful
for a constructive solution, and we agree with the Governor that PG&E going
into bankruptcy was really an irresponsible move. For one thing, and I know that there is disagreement about this,
we think that a major structural change that will really help consumers is the
purchase of the entire transmission system of the state of California. With PG&E in bankruptcy, it throws a lot
of doubt about whether that’s doable.
((Gary Ackerman, Western Power Trading Forum))
But, Lenny, what if
your assumption is wrong? What if
buying the transmission system provides nothing for consumers?
((Lenny Goldberg, The Utility Reform Network))
Well, we know—
((Gary Ackerman, Western Power Trading Forum))
Well, I think you’re
wrong.
((Lenny Goldberg, The Utility Reform Network))
That it has a number
of benefits in terms of lower capital costs for upgrading, breaking many of the
constraints, a degree of independence from FERC—
((Gary Ackerman, Western Power Trading Forum))
But what percentage
of their bill goes toward transmission?
((Lenny Goldberg, The Utility Reform Network))
—working and
coordinating with the MUNIs, being able to have a much better relationship with
distributed generation—
((Melissa))
Joe, we want to get
you in on this because you’re part of the plan B.
((Assemblyman Joe Canciamilla, [D] Pittsburg))
I’m just enjoying
listening to them argue back and forth because this is similar to arguments
that we’ve been having over the whole question of whether the deal is
appropriate. I want to go back to a
couple of things that have been said, and I think for us in the legislature the
tremendous frustration has been that there is no clear direction. There is no sense of where we ultimately
want to go with this. Do we want a
public power authority? Do we want full
state regulation? Do we want a complete
deregulation? Do we want to buy the
transmission lines or the hydro? We
have been stumbling back and forth trying to come up with an answer, and we’re
giving the industry mixed signals—
((Jack))
Steve, do you want to
respond to that? It sounds like he’s
basically saying there’s a lack of leadership.
((Steve
Maviglio, Governor’s Press Secretary))
Well, I think that’s wrong.
We’re very clear where we’re going.
We have a plan for getting more power online; we have a plan for
conservation, and we’ve negotiated for months with all the utilities; we’re
there with two to three of the utilities.
We’re there in terms of getting that generation online, but more
importantly, this all boils down to price.
We have generators that are charging us sixteen dollars last year, and
the sky is the limit this year, and there’s no moral outrage about that. These guys haven’t improved their power
plants; they haven’t done anymore work; they’re just ripping us off time and
time again.
((Jack))
Jim, you’re the Republican here. What is the Republican plan in either the senate or assembly?
((Senator
Jim Battin, [R] La Quinta))
Well, the Republican plan is fundamentally increasing
supply. I mean, if you had looked back
a year ago, this is not a new problem.
It didn’t start in January; it didn’t start in April. We knew about it in June of last year. You just had to look at San Diego. Rates had gone up two to three hundred
percent—
((Jack))
But looking ahead, what’s the GOP plan?
((Senator
Jim Battin, [R] La Quinta))
Well, the GOP plan is increasing supply, and spending
billions of dollars of taxpayer’s money to buy transmission lines doesn’t do
one thing to increase supply in California.
We’re talking about—and, frankly, I agree; I’m not to happy with the
generators’ pricing structure. The only
way to affect that is to get more supply in there so that we drive their prices
down, and we’re not having that discussion here. You know, we’re just about to debate a citing plan to get more
power plants built in California. It’s
at the end of April. We started this
thing in January; we started the crisis in June, and if we started seriously
acting to build power plants with the Governor using his executive powers to
waive regulations to get plants built in this state, we wouldn’t have the
problem that we’re going to face this summer—
((Assemblyman
Joe Canciamilla, [D] Pittsburg))
But that is not necessary.
It is not necessary for us to go back and redesign the power plant
citing to get plants built. I have two
Calpine plants being built in my city alone this year. It started years ago.
((Senator
Jim Battin, [R] La Quinta))
That’s right. They
take years. They take years to
build. We don’t have time in California
to go through the entire regulatory and bureaucratic functions of taking years
to build a power plant, and half that time is just going through the
regulations and bureacracy—
((Assemblyman
Joe Canciamilla, [D] Pittsburg))
But let me respond and offer a Republican argument
then. Are we not, then, going to usurp
local control? We have built a system
that allows local communities to decide what goes in their city.
((Senator
Jim Battin, [R] La Quinta))
We have a crisis in our midst right now, and sometimes, when
you have extraordinary events, you have to do extraordinary things. When we had the Loma Prieta earthquake, the
Santa Monica Freeway was destroyed.
Caltrans told Pete Wilson it was going to take two years to rebuild that
freeway. The Governor said, “We have a
crisis; we’re going to declare a state of emergency; we’re going to waive the
rules and regulations; I’m going to show some leadership.” Sixty-six days later—
((Assemblyman
Joe Canciamilla, [D] Pittsburg))
I’m not disagreeing with you.
((Senator
Jim Battin, [R] La Quinta))
—people were driving on the freeway. We needed to do that last June.
((Assemblyman
Joe Canciamilla, [D] Pittsburg))
I’m not disagreeing with that. We’re still in the Bay Area waiting to retrofit the Bay Bridge,
but if we’re going to do that, we have to make sure that the distribution of
power plants is fair and equitable. It
goes all around the state.
((Lenny
Goldberg, The Utility Reform Network))
This issue is not relevant to the fact that the generators
are screwing us day in and day out, and that’s because any number of months,
any number of hours this winter, of this fall, or of this spring, our demand
has been equal to or lower than last year; our supply has been essentially the
same. We’ve been way under capacity in
terms of the demands that we’re putting on the system, and they’re charging us
ten times as much—
((Gary
Ackerman, Western Power Trading Forum))
We’re charging you the value, Lenny.
((Lenny
Goldberg, The Utility Reform Network))
The Governor is right. The
market is fundamentally broken.
((Gary
Ackerman, Western Power Trading Forum))
Back to Economics 101, Lenny. It doesn’t change just because you say it over and over
again. It’s value, not cost, and value
of the commodity called electricity is far, far higher now than it has ever
been in the past, so I think the public is pretty tired of hearing you charging
us again.
((Melissa))
But, Gary, how do we explain a jump of $750.00 a megawatt
hour as compared to last year at $12.00?
No matter how you work those numbers on paper—
((Gary
Ackerman, Western Power Trading Forum))
Because cost is not the driver. Value is. People are
willing to pay that price—
((Lenny
Goldberg, The Utility Reform Network))
It is called market
power—
((Gary
Ackerman, Western Power Trading Forum))
It is not called market power. That is just your explanation of what you don’t know, and what we
do know is that buyers and sellers are willing to transact at those
prices. People are willing to pay those
prices. If California doesn’t want to
pay them; they don’t have to.
((Jack))
Before we leave this discussion, I want to get in the fact
that the California bond rating has gone down, and what that means is it’s
harder to sell California bonds on Wall Street for just about anything. In fact, we’re taping this program on
Thursday morning, and I’ve seen some stories in the California papers that
there are few buyers now for California bonds.
The heart of that issue is the 13 billion dollars that the utilities
lost when they were forced to buy power at a high price but could only collect
a small amount of money from ratepayers.
We’ve never even come close to approaching that problem. What’s the fix for that?
((Senator
Jim Battin, [R] La Quinta))
Well, I think the bond issue is a very important one, and we
look at what the rest of the country thinks of California in our bond rating.
((Jack))
That 13 billion dollars, though, seems to be the elephant in
the room that no one want to acknowledge, and it’s causing all these problems.
((Senator
Jim Battin, [R] La Quinta))
It does cause me great concern when our answer to every
problem is to have California taxpayers let more bonds out. I mean, we’re going to buy public power;
we’re going to build power plants; we’re going to buy transmission lines; we’re
going to buy power. You know, how are
we going to do this? More bonds, bonds,
bonds. I don’t know if anybody is
willing to insure these bonds. That’s a
big question to ask whether anybody will even insure them.
((Jack))
Joe, what should happen to that 13 billion dollars? Should the utilities eat it? Should it become part of the
bankruptcy? What should happen?
((Assemblyman
Joe Canciamilla, [D] Pittsburg))
Well, it’s going to have to be part of a comprehensive
plan. You can’t ignore it; you can’t
let it slide. Obviously, it’s part of
what is driving the underlying instability of the marketplace, but you’re
right. It has been the elephant in the
room that no one has been dealing with because we’ve been dealing with a lot of
nonsense over the last few months, and we have not been tackling the
fundamental issue, which is, “How do we stabilize the market and get out of the
power business?”
((Melissa))
Steve, what the Governor seemed to allude to at a press
conference earlier this week is that he’s trying to stabilize the prices. In essence, we’re sort of borrowing on
credit, and we’re going to be paying a big credit balance for many, many years
to come. Is that in essence his plan and
how the state will cover these tremendous costs to buy power?
((Steve
Maviglio, Governor’s Press Secretary))
Well, we’re in an emergency, and he likens it to a forest
fire. We have to keep the lights on,
and we’re going to have to pay for that.
Will we get paid back?
Absolutely. Under the rate
design plan that he put forward, we’re going to get all our money back plus
interest. Fortunately, he really vetoed
a number of bills over the last couple of years that would have really hiked
state spending. We have a very nice
surplus that we’re tapping into for the time being, but it’s just a cash flow
problem. We’ll get that money back.
((Melissa))
Should we be concerned?
This is basically the legislature’s push week to get all these bills
decided on, and we don’t know what will be left to fund all these measures.
((Steve
Maviglio, Governor’s Press Secretary))
Well, uncertainty is the big gorilla in this room. That’s what bothers Wall Street; they don’t
know what’s going to happen here. The
legislature is unsure on what the total package is going to be because they
haven’t signed off on that. That’s
what’s really affecting prices right now, and it’s affecting the whole market.
((Senator
Jim Battin, [R] La Quinta))
Now, I’m Vice Chair of the Appropriations Committee in the
senate, and I’ll just tell you this: any bill that spend anything over a
hundred and fifty thousand dollars, we’re putting on the suspense calendar, and
we’re not taking it off the suspense calendar until we have some idea of what the
state has to spend. I mean, that’s a
really easy bipartisan thing to say—
((Jack))
This discussion has gone by really fast, and we’ve just run
out of time.
((Melissa))
We appreciate your thoughts and insight, and we’d like to
thank you for joining us. We’d like to
hear what else you at home have to say.
T Hill from Placerville writes:
“If we do not have enough electric power to go around. . .
why are more homes being added to the grid?”
((Jack))
C Robinson from Bakersfield says more generation is needed,
and quote:
“This thing hasn’t even begun to show its ugly head.”
We appreciate your comments. We want to know if you would
prefer higher bills and steady power or more blackouts but lower cost?
That’s our question this week. Send us your thoughts on the
energy crisis by logging onto capitol week dot org.
((Melissa))
Then click on at issue, energy For the latest on the energy
crisis.
Next week, Is the
energy crisis creating a crisis in leadership as well?
Until then, I’m Melissa Crowley.
((Jack))
And I’m Jack Kavanagh. Thanks for joining us.