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Enron Mail |
FYI. Did we talk to Leopold? Might be useful to stress that that under
noncore/core (like Direct Access), customers choose from among a host of competing providers for their service, not just Enron. Best, Jeff California Lawmakers Eye Billing Businesses for Edison Rescue By Jason Leopold ? 18:00 ET Dow Jones Business News (Copyright © 2001, Dow Jones & Company, Inc.) Dow Jones Newswires LOS ANGELES -- California lawmakers are mulling yet another set of ideas for rescuing embattled Southern California Edison, and this time businesses would be on the hook. In an attempt to deflect charges of a bailout that have thus far stymied efforts to restore the utility to solvency, legislators are now considering ways to shift the burden of financing the rescue from residential ratepayers to the state's largest businesses, aides to key state lawmakers said this week. The ideas being worked over by Senate President Pro Tem John Burton, Assembly Speaker Robert Hertzberg and Assemblyman Fred Keeley have yet to take shape as formal proposals. But an aide to Burton said some key lawmakers are so "desperate" to keep Edison International (EIX) utility Southern California Edison from following PG&E Corp. (PCG) unit Pacific Gas & Electric into bankruptcy court that they are willing to consider anything that will takse residential consumers out of the equation. "The idea is that the large industrial customers are the ones who pushed for deregulation in the first place, so they should be responsible for bailing out Edison," the aide said. "We're looking to take the burden off of residential ratepayers." The premise of a plan discussed by lawmakers on a conference call Thursday is to designate Southern California Edison's largest commercial ratepayers as non-core customers. Those customers -- some 3,600 users of more than 500 kilowatt-hours a month -- would be responsible for financing the cost of power the utility must purchase or have purchased for it in the wholesale market. The non-core customers would also help the utility recoup most of its $5.5 billion in unrecovered power costs through a surcharge on their bills. Core residential customers would be protected from the wholesale power market as the primary beneficiaries of the low-cost power the utilities generate themselves or have locked up in long-term contracts. Enron Pushing Access to Customers Separately, Enron Corp. (ENE) has been lobbying lawmakers for several weeks to win approval to sign power-supply contracts with Southern California Edison's largest commercial customers, leaving the utility to serve just its residential customers and small businesses, aides to Gov. Gray Davis, Messrs. Burton and Hertzberg said. An Enron executive confirmed that the company sent a four-page proposal to Mr. Hertzberg proposing that Southern California Edison's large industrial customers sign so-called direct-access contracts with Enron. Enron also has recently made a presentation about direct access to some members of the California Chamber of Commerce. Under the proposal, heavy users would be required to contract directly with companies like Enron for their power. Direct access was a key part of the state's 1996 deregulation plan, but was scrapped early this year when the state started buying wholesale power in place of the utilities. The core/non-core proposal is one of several being discussed by lawmakers as alternatives to a memorandum of understanding Mr. Davis struck with Edison in April. The MOU -- which doesn't vary much from an agreement in principle reached in February -- has been called dead on arrival by some lawmakers, who have been mulling various alternatives rather than moving the agreement forward. State Sen. Debra Bowen, a Redondo Beach Democrat and chairwoman of the Senate energy committee, said there are so many "Plan B's" floating around the Legislature that, "We're going to need to hire an apiculturist." Steve Maviglio, a spokesman for the governor, said the Davis administration is still dedicated to seeing legislation to enact the memorandum of understanding move through the Legislature, but said separating the utility's "core and non-core" customers would be at the forefront of new discussions. It was too early to say whether the governor would support the plan, he said. Dominic DiMare, a lobbyist with the California Chamber of Commerce, said the chamber has told the Davis administration that shifting the burden of the Southern California Edison bailout to businesses is "a very bad idea" that could cost the state billions of dollars in economic activity. "This [plan] would really screw businesses," Mr. DiMare said. "We just got hit with a 50 to 90% rate increase. We're dangerously close to losing our businesses to other states." Write to Jason Leopold at jason.leopold@dowjones.com Copyright © 2001 Dow Jones & Company, Inc.
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