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Sac Bee, Thurs, 5/10: "PUC sweats $4.8 billion rate raise" Sac Bee, Thurs, 5/10: "PG&E wants panel to get boot" Sac Bee, Thurs, 5/10: "Major job losses predicted; governor presses=20 generators" Sac Bee, Thurs, 5/10: "Bond-sale bill goes to Davis " Sac Bee, Thurs, 5/10: "State revenue outlook shrinks " SD Union, Thurs, 5/10: "No blackouts despite dip in supplies" SD Union (AP), Wed, 5/9: "Biggest users face huge rate hikes under PUC pla= n" LA Times, Thurs, 5/10: "Rate Hikes Up to 60" Proposed by PUC Chief" LA Times, Thurs, 5/10: "Bush Energy Stance Begins to Worry Some in GOP" LA Times, Thurs, 5/10: "In Office Buildings, the Lights Are On, But Nobody= 's=20 Home" LA Times, Thurs, 5/10: "Power Shifts to Congress" (Commentary) SF Chron, Thurs, 5/10: "Proud state forced to knees in power hunt"=20 SF Chron, Thurs, 5/10: "Power bills set to skyrocket for heavy users=20 Graduated rate increase would take effect in June " SF Chron (AP), Thurs, 5/10: "Developments in California's energy crisis " SF Chron (AP), Thurs, 5/10: "PG&E says fewer small power plants offline " SF Chron (AP), Thurs, 5/10: "A look at two rate designs before power=20 regulators" SF Chron, Thurs, 5/10: "Lights stay on despite failure of big plant"=20 SF Chron, Thurs, 5/10: "PG&E fights consumer committee=20 Obstruction feared in bankruptcy case " SF Chron, Thurs, 5/10: "Generators silent on Davis plan=20 He offers lower compensation to stave off Edison bankruptcy " Mercury News, Thurs, 5/10: "Rate plans shield most households" Mercury News, Thurs, 5/10: "Energy bond plan gets final legislative OK,=20 faces delay" Mercury News, Thurs, 5/10: "Fusion research gets a boost" OC Register, Thurs, 5/10: "Power is Money PUC details plan to raise Edison rates up to 34%. Half of users to see no= =20 hike" OC Register, Thurs, 5/10: "Economic crisis in forecast" OC Register, Thurs, 5/10: "GOP stalls sale of bonds with vote" OC Register, Thurs, 5/10: "Electricity notebook Davis asks power suppliers to accept 30% less than owed" OC Register, Thurs, 5/10: "Regulators says more electricity rate hikes are= =20 likely" OC Register, Thurs, 5/10: "Starting all over again The Legislature's special session on the power crisis ends today -- with mo= re work to do at an added cost" OC Register, Thurs, 5/10: "Davis is set to sign a $13.4 billion bond-issue= =20 measure today to cover electricity costs" OC Register, Thurs, 5/10: "Papering over state electricity problems" Individual.com (AP), Thurs, 5/10: "Task Force To Propose Legislation" Individual.com (AP), Thurs, 5/10: "Stage 2 Electrical Emergency Declaratio= n; SCE to Curtail 'Load' for Some Customers" Individual.com (Bridgenews), Thurs, 5/10: "[B] FULL/ Pacific Gas & Electri= c=20 restores all Qualifying=20 Facilities --Pacific Gas & Electric says 8 of 300 QFs still shut down"=20 ---------------------------------------------------------------------------= --- ------------------------------------- PUC sweats $4.8 billion rate raise By Carrie Peyton Bee Staff Writer (Published May 10, 2001)=20 Big industries' electric bills would leap 50 percent or more and household= =20 bills would rise an average of 11 percent to 17 percent under two proposals= =20 outlined by state regulators Wednesday for revamping electric rates.=20 The twin proposals are efforts by Loretta Lynch, president of the state=20 Public Utilities Commission, and Christine Walwyn, a PUC administrative=20 judge, to decide how to divide the burden of a $4.8 billion rate hike.=20 "Both of them are just going to be very, very hard on business," said Bill= =20 Booth, an attorney for the California Large Energy Consumers Association. H= e=20 said it appeared that some cement and steel makers could face 90 percent ra= te=20 hikes.=20 But small consumers were equally dismayed.=20 "This never should have happened in the first place," said Bob Finkelstein,= =20 an attorney with The Utility Reform Network, placing the blame for soaring= =20 rates on electric deregulation.=20 "In terms of allocating the fallout from the failed experiment, they seemed= =20 to do a reasonable job. But it assumes that the fallout should be allocated= =20 in the first place, and that just sticks in our craw," he said.=20 Several PUC commissioners have said they want to select a new rate design a= t=20 a special meeting Monday, so the higher electric bills can begin going out= =20 June 1 to customers of Pacific Gas and Electric Co. and Southern California= =20 Edison.=20 One version before the PUC would include Lynch's call to begin looking for= =20 ways to charge federal installations power rates that are tied to wildly=20 gyrating wholesale costs.=20 Reportedly first floated as a joke, the idea quickly took hold within the= =20 PUC. Lynch said she wants to set it up as "pilot program," perhaps beginnin= g=20 in mid-summer, so the federal government can test its own theories about=20 unfettered market prices being good for consumers.=20 "I don't believe it's a dig at the FERC (Federal Energy Regulatory=20 Commission)," she said during a news conference.=20 But she repeated her attack on federal regulators, saying electric rates ar= e=20 rising in California only because the FERC has refused to cap runaway=20 wholesale electric prices.=20 Commissioner Richard Bilas later called a special federal rate "silly" and= =20 "kindergartenish," and said the proposal was clearly intended "just to get= =20 back at the federal government."=20 Any of the five appointed commissioners can offer an alternate version of t= he=20 rate design, as Lynch did. The alternates will be considered alongside the= =20 proposal by Walwyn, the judge who presided over lengthy hearings on how the= =20 new rates should be crafted.=20 She recommended increases that would fall slightly more softly on residenti= al=20 customers -- averaging 11 percent for Edison and 15 percent for PG&E -- and= =20 more heavily on large industrial users, averaging 52 percent for Edison and= =20 55 percent for PG&E.=20 But within those averages could be much higher individual increases, and=20 advocates for everyone from farmers to manufacturers waited anxiously=20 throughout the day for detailed tables that would list rates for dozens of= =20 customer categories.=20 "I have got my expert economist standing by to look at the numbers when the= y=20 come out," said Ron Liebert, associate counsel for the California Farm Bure= au=20 Federation.=20 The release of the rate proposal has been delayed repeatedly as the PUC tri= ed=20 to cram work that usually takes months into just a few weeks, and many of i= ts=20 details remained obscure late Wednesday, dismaying those who are still=20 arguing for changes.=20 "We have to file comments on this by Friday. What they're doing is, they're= =20 shutting down the comment period," said Jack Stewart, president of the=20 California Manufacturers & Technology Association.=20 He said it appears that some rates could nearly double, and "that's just a= =20 death knell for many California manufacturers."=20 Lynch provided only sketchy summaries of her ideas, saying she wanted to=20 raise residential rates 16 percent for Edison and 17 percent for PG&E on=20 average, raise industrial rates 50 percent to 52 percent and cap agricultur= al=20 rate increases on a sliding scale from 23 percent to 30 percent, partly at= =20 Gov. Gray Davis' urging.=20 She said that about half of households statewide would see no increase unde= r=20 a state law that protects those who use less than 130 percent of a "baselin= e"=20 amount. However, PG&E has calculated that far more households -- 69 percent= =20 -- use more than the baseline at some point during the year.=20 PG&E's baseline varies by region and season but generally runs between 300= =20 and 400 kilowatt-hours, or about 50 percent to 60 percent of average=20 electricity use per household. It was created to give people access to a=20 minimal amount of power at a lower rate.=20 The heaviest household users still would see no increase on their first few= =20 hundred kilowatt-hours, but after that prices would rise sharply, in tiers,= =20 so that some households could see their overall bills rise 34 percent or=20 more.=20 Lynch and Walwyn also have proposed "bill limiters" so that businesses with= =20 unusual usage patterns won't get hammered by unintended rate spikes.=20 The increases will not affect customers of the Sacramento Municipal Utility= =20 District, which recently approved its own hikes, averaging 22 percent, and= =20 other ratepayer-owned utilities.=20 The Bee's Carrie Peyton can be reached at (916) 321-1086 or=20 cpeyton@sacbee.com.=20 PG&E wants panel to get boot By Claire Cooper Bee Legal Affairs Writer (Published May 10, 2001)=20 SAN FRANCISCO -- Pacific Gas and Electric Co. on Wednesday asked a judge to= =20 disband an unprecedented committee of ratepayers appointed last week to=20 represent consumers in the utility's bankruptcy case, saying that some in t= he=20 group were politically biased.=20 The utility filed a motion arguing that U.S. Bankruptcy trustee Linda Ekstr= om=20 Stanley exceeded her legal authority by designating a consumers committee= =20 armed with broad powers to investigate and negotiate alongside the utility= =20 and its creditors.=20 The utility denounced the committee as a collection of "special interest"= =20 groups with "well-known political and policy agendas" and a "history of=20 aggressive lobbying and litigation."=20 The PG&E motion, which was set for a hearing May 18 before Bankruptcy Judge= =20 Dennis Montali, warned that turning the consumer committee loose could=20 "substantially retard the progress of this case and seriously prejudice its= =20 outcome."=20 On Friday, PG&E singled out Consumers Union and The Utility Reform Network = as=20 "well-organized lobbyists and political operatives."=20 Consumers Union regional chief Harry Snyder, a committee member, said he=20 would have no comment. TURN's representative to the committee, Nettie Hoge,= =20 did not respond to a request for comment.=20 In appointing the ratepayers committee last week, Stanley, who is=20 administering the bankruptcy proceedings, said she was bringing it into the= =20 case because the state, which ordinarily would represent the public, has=20 chosen to stay out.=20 Stanley chose the nine committee members to represent a mix of energy=20 consumers -- households, businesses, farms and government. In addition to= =20 Consumers Union and TURN, the groups include the California Farm Bureau, th= e=20 California School Boards Association and the California Manufacturers &=20 Technology Association.=20 If Montali upholds Stanley's action, PG&E must pay for the committee's=20 lawyers, accountants and other consultants to analyze data and present=20 arguments in the bankruptcy proceedings from the consumer's perspective.=20 "They (will) have all of the information that's going on," said Judy Beckne= r=20 Sloan, a bankruptcy expert at Southwestern Law School, who speculated that= =20 PG&E was balking at the committee's potential power and its costs to the=20 bankruptcy estate.=20 "The creditors and PG&E are opposed to their presence because to the extent= =20 the judge heeds the consumers' concerns, he's going to be less aggressive= =20 about raising rates," said Jesse Fried, a law professor at the University o= f=20 California, Berkeley.=20 While Fried said Stanley's decision was defensible because the judge "is=20 supposed to take into account the wider interests of society," Los Angeles= =20 bankruptcy lawyer Richard Levin sided with PG&E. Only the state should have= =20 been allowed to represent consumers, Levin said, and its decision not to do= =20 so should be final.=20 The Bee's Claire Cooper can be reached at (415) 551-7701 or=20 ccooper@sacbee.com.=20 Major job losses predicted; governor presses generators By Dale Kasler, Ed Fletcher and Emily Bazar By Dale Kasler, Ed Fletcher and Emily Bazar (Published May 10, 2001)=20 As a private consultant predicted the state will lose 135,000 jobs from a= =20 summer of blackouts, Gov. Gray Davis on Wednesday pressed power generators = to=20 forgo 30 percent of their California earnings to help pull the state out of= =20 the energy crisis.=20 Summoning executives of the companies he has repeatedly accused of price=20 gouging, Davis said the generators probably would have to forgive a portion= =20 of the debt they're owed by California's two destitute utilities to win the= =20 Legislature's approval for his controversial plan to repay the debts and=20 rescue the utilities.=20 "I suggest that they should look to (accept) 70 percent of what they claim= =20 they were owed," Davis said after a four-hour meeting in the Capitol. "I fe= lt=20 the Legislature will insist on a reduction."=20 Although Davis said, "I believe they are willing to take some reduction," a= t=20 least one generator, Reliant Energy Inc., immediately dismissed the=20 governor's proposal.=20 The meeting capped a roller-coaster day in which anti-generator protesters= =20 brought a pig to the Capitol and the state narrowly averted a third straigh= t=20 day of rolling blackouts. But while enough megawatts were found to scrape b= y=20 for a day, the state is surely facing a summer of severe shortages.=20 A study, commissioned by some of the state's most influential business=20 lobbyists and partly funded by Intel Corp., predicted chronic blackouts wil= l=20 mean significant economic harm to California.=20 The study by John Urbanchuck of New Jersey-based AUS Consultants said the= =20 blackouts would erase 135,000 jobs and cause $26 billion in economic=20 devastation.=20 Several California economists said the prediction was overblown, but none= =20 doubted the electricity crisis could significantly harm the state's busines= s=20 climate.=20 "It really depends on how severe the blackouts are," said UCLA economist=20 Chris Thornberg. "If we have 30 straight days of blackouts in June ... you'= re=20 going to end up with a mess."=20 Everything else being equal, the loss of 135,000 jobs would raise=20 California's unemployment rate by 0.7 percent, to 5.4 percent, based on the= =20 latest numbers from the Employment Development Department.=20 Ted Gibson, chief economist with the state Department of Finance, said AUS'= =20 estimates seem high.=20 "It'd be hard for me to think those relatively limited, one-hour-at-a-time= =20 (blackouts) would have such an impact," Gibson said.=20 As it is, the blackouts have struck some of California's most important=20 employers, such as Sun Microsystems Inc. and Advanced Micro Devices.=20 Tuesday's blackout hit Apple Computer Inc.'s lone U.S. factory, in Elk Grov= e.=20 Economic development agencies from other states have stepped up recruiting= =20 efforts in California, hoping to capitalize on the state's misfortunes. A f= ew=20 glass manufacturers have moved production, said Jack Stewart, president of= =20 the California Manufacturers & Technology Association.=20 It could get worse. For example, a leading Silicon Valley electronics=20 manufacturer, Solectron Corp. of Milpitas, said it is seriously considering= =20 pulling some of its operations out of California.=20 "The blackouts and the lack of reliable power are our biggest concerns," sa= id=20 Solectron spokesman Bob Kula. "We have the ability to move (production)=20 quickly."=20 Solectron, whose factories were hit with blackouts in January and March,=20 employs 4,000 workers in Northern California.=20 A top state official said business leaders around the country look at the= =20 electricity crisis as emblematic of a state that's becoming iffy as a place= =20 to do business.=20 "The whole question of how did the state allow it to get this far -- I keep= =20 hearing that from Wall Street, I keep hearing that from the business=20 community," said the official, who asked to remain anonymous. "The last yea= r=20 has demonstrated that the risks of doing business in California are much=20 higher than anywhere else in the United States."=20 The state was spared a third day of blackouts Wednesday when cooler, windie= r=20 weather in the late afternoon produced a spurt of wind-generated electricit= y=20 and a much-needed drop in demand. Throw in an unexpected power purchase fro= m=20 the Pacific Northwest, and the state's fragile power grid suddenly had 1,40= 0=20 megawatts it wasn't expecting, more than enough to compensate for a breakdo= wn=20 of a major Bay Area power plant in early afternoon.=20 Another boost: Pacific Gas and Electric Co. said all but a handful of its= =20 alternative-energy suppliers have resumed production. These suppliers,=20 responsible for a fourth of the state's energy supply, have been closed for= =20 weeks because of nonpayment by PG&E and Southern California Edison. The two= =20 stricken utilities are paying them again.=20 But while blackouts were unlikely today, there were no guarantees.=20 "We're not swimming in megawatts," said spokeswoman Stephanie McCorkle of t= he=20 Independent System Operator, which runs the state's power grid.=20 Representatives from a dozen wholesale power generators -- 10 in person and= =20 two by phone -- attended the Capitol summit.=20 Despite months of verbal potshots between Davis and the generators, the=20 meeting was described as cordial by John Stout, senior vice president of=20 Houston-based Reliant.=20 But Davis also said he told the executives that unless they accept a=20 reduction in payment for back debts, the Legislature is likely to reject hi= s=20 plan to buy the utilities' transmission lines -- a key element of his plan = to=20 pay back billions the utilities owe them.=20 If the plan goes through, the generators can get paid this year, Davis said= .=20 If it's killed, they'll probably have to wait three or four years to get=20 their money in Bankruptcy Court.=20 So far only Edison has agreed to sell its lines to the state. Senate=20 President Pro Tem John Burton, D-San Francisco, said Wednesday that the=20 Edison deal will be rejected unless the generators forgive some debts.=20 "I'm going to insist that they take at least a 30 percent haircut on the=20 monies that they're owed," Burton said earlier.=20 The Bee's Dale Kasler can be reached at (916) 321-1066 or dkasler@sacbee.co= m.=20 Bee Staff Writer Kevin Yamamura contributed to this report.=20 Bond-sale bill goes to Davis=20 (Published May 10, 2001)=20 The state Senate sent legislation to Gov. Gray Davis on Wednesday authorizi= ng=20 the largest revenue bond sale in U.S. history over continued Republican=20 opposition.=20 The bill, SB 31x, would allow California to sell $13.4 billion in bonds,=20 starting in August, to repay the state for past and future power purchases.= =20 Davis is expected to sign the bill today.=20 Because the bill failed to receive the two-thirds majority needed for an=20 urgency measure, however, the bonds can't be sold until 90 days after the e= nd=20 of the Legislature's special session.=20 Lawmakers are expected to end the session Monday, and most of the 200 pendi= ng=20 energy bills already introduced will be reborn in a second energy session,= =20 said Senate President Pro Tem John Burton, D-San Francisco.=20 SB 31x passed on a 23-12 vote, with most Democrats supporting the measure a= nd=20 all Republicans opposing it. Sen. Joe Dunn, D-Garden Grove, was the only=20 Democrat to vote against it.=20 Republicans proposed that the state use the surplus to write off $6 billion= =20 that California has spent on electricity since mid-January. But Democrats= =20 said the state needs to replenish those funds to support other state progra= ms=20 in education, transportation and health care.=20 Treasurer Phil Angelides had pursued a bridge loan of $4.13 billion to=20 bolster the state's budget and ensure that non-energy programs remain funde= d.=20 But when Assembly Republicans assailed the immediate bond sale, the=20 short-term loan was lost.=20 Zane Mann, editor of the California Municipal Bond Advisor, said the delay = in=20 the bond sale "casts a cloud" over the project but won't kill it. It will= =20 probably lead to a higher interest rate, which will add to the ratepayers'= =20 costs, he said.=20 -- Kevin Yamamura and Dale Kasler=20 State revenue outlook shrinks=20 By John Hill Bee Capitol Bureau (Published May 10, 2001)=20 Legislative Analyst Elizabeth Hill dropped a budget bombshell Wednesday,=20 reporting to legislators that state revenues will be $3.4 billion lower tha= n=20 Gov. Gray Davis predicted in his January budget proposal.=20 Instead of enjoying a $1.9 billion reserve, the Davis budget plan for the= =20 fiscal year beginning July 1 would now leave the state $1.5 billion in the= =20 hole, Hill wrote in a letter to legislators overseeing the budget.=20 Dwindling revenue from a faltering economy leaves Davis' plan in need of=20 major revisions. The new revenue estimates would require cuts in one-time= =20 expenditures that Davis proposed for programs such as clean beaches and=20 fiscal relief for local governments. Cuts also may have to be made in new= =20 spending contemplated for education, which got most of the new money in the= =20 $104.7 billion January budget proposal.=20 "The number is so deep that it's going to be hard for us not to contemplate= =20 cuts or make cuts," said Assemblyman Tony C?rdenas, D-Sylmar, vice chairman= =20 of the Joint Legislative Budget Committee. "We don't know where those cuts= =20 are going to come from."=20 Little will be immune, said Dan Howle, chief of staff for Sen. Steve Peace,= =20 D-El Cajon, chairman of the Joint Legislative Budget Committee.=20 "It's going to include programs the governor is very supportive of and woul= d=20 like to get done, but we're in a little bit of a cash crunch here, and you'= ve=20 got to do what you've got to do," he said.=20 "If anything's got a protective fence around it, it's education. But I stil= l=20 think it'll have to take a share of the cuts."=20 These grim budget figures don't take into account possible hits on the budg= et=20 caused by the state's breathtaking expenditures on electricity.=20 Those effects could be negligible if the state is able to sell bonds to pay= =20 for power and replenish the treasury. But considering recent events in the= =20 volatile energy crisis, no assumption is safe.=20 The budget crunch will likely highlight conflicting spending priorities and= =20 could lead to more polarization between Democrats and Republicans who have= =20 been squabbling over the energy crisis.=20 "A third of the Assembly has never done a budget," Howle said. "Another thi= rd=20 has never dealt with anything other than huge surpluses. Now you're saying= =20 we've got to go in and cut. This could be a long, hot summer."=20 The new revenue projections are a dramatic illustration of the state's=20 faltering economy. Revenues for the fiscal year that starts July 1 are now= =20 expected to be $4.8 billion less than anticipated in January, Hill wrote.= =20 That includes a decrease of $3.9 billion in income tax, $500 million in sal= es=20 tax and $600 million in bank and corporation taxes, offset by some moderate= =20 increases in insurance and estate taxes, said Brad Williams, chief economis= t=20 in the non-partisan Legislative Analyst's Office.=20 "It's deterioration in the stock market and implications for capital gains= =20 and stock options," Williams said, "and also the weakening outlook for the= =20 economy as a whole."=20 The $4.8 billion blow is softened somewhat by unexpectedly strong revenues= =20 from last year's tax returns, which helped boost revenues $1.4 billion high= er=20 than had been anticipated.=20 The net effect is $3.4 billion less for the fiscal year that begins July 1.= =20 If the Democratic governor's budget were approved as is, the deficit would= =20 reach almost $6 billion in the fiscal year that begins July 1, 2002, Hill= =20 wrote.=20 The governor is expected to release his revised budget Monday. The state=20 Department of Finance said Wednesday that it wouldn't comment on the new=20 revenue estimates until then.=20 One obvious target for budget cutters is one-time expenditures in the Janua= ry=20 proposal. This includes money for local governments, state building project= s,=20 housing initiatives, replacing diesel engines that contribute to air=20 pollution, cleaning up beaches, law enforcement technology grants, flood=20 control, parks along rivers and more.=20 Even if the state axed $2.5 billion for one-time expenditures that Davis=20 proposed, it would still have to cut an additional $1.7 billion proposed fo= r=20 ongoing programs.=20 Davis' budget -- which projected an $8 billion surplus -- includes at least= =20 $1.9 billion more for education than required under formulas approved by=20 voters in Proposition 98. But considering Davis' commitment to education,= =20 most believe it's unlikely the governor would balance the budget by=20 throttling back to the minimum funding level, which would require cuts to= =20 existing education programs.=20 C?rdenas said education, health care and transportation should be protected= =20 from cuts.=20 Assembly Republicans agree about education, but have different ideas about= =20 the rest.=20 On Wednesday, the Republicans released their plan for the revised budget. I= t=20 includes protecting schools and law enforcement, creating a $4 billion=20 reserve for future electricity purchases, and striking a proposed 1/4-cent= =20 sales tax increase.=20 The sales tax, which went into effect in the early 1990s, was removed this= =20 year, but Davis has proposed restoring it in 2002.=20 "All this does is put a new burden on the backs of Californians" already=20 coping with higher energy costs, said Assemblyman George Runner, R-Lancaste= r,=20 a member of the Assembly Budget Committee.=20 Republicans say an electricity reserve could avoid the need to do another= =20 bond sale for power purchases next year.=20 "This is the time to make sure we are putting money aside and that we're no= t=20 going to have to turn back to taxpayers or ratepayers and put an additional= =20 burden on them," Runner said.=20 The Bee's John Hill can be reached at (916) 326-5543 or jhill@sacbee.com.= =20 No blackouts despite dip in supplies=20 Stage 2 alert, power plant breakdown add to concerns By Jeff McDonald=20 UNION-TRIBUNE STAFF WRITER=20 May 10, 2001=20 In the nip-and-tuck world of meeting California's energy needs, a small=20 victory was notched yesterday in Folsom, where managers of the state power= =20 grid avoided blackout orders for the first time since the weekend.=20 But tensions nonetheless ran high among power industry officials, and=20 business leaders in San Diego County are growing increasingly alarmed at th= e=20 nagging energy crisis.=20 The number of available megawatts fluctuated throughout the day yesterday a= nd=20 a major power plant broke down, but engineers at the Independent System=20 Operator maintained service across the state.=20 Persistent shortages combined with unusually high temperatures prompted pow= er=20 alerts as early as 10:15 a.m., when grid officials warned that supplies had= =20 dipped within 7 percent of reserves.=20 With more than 12,000 megawatts of power unavailable from idled plants,=20 system operators issued a Stage 2 warning about 11:45 a.m. and asked large= =20 users to cut back consumption through the afternoon.=20 Two hours later, a boiler tube leak knocked out a 750-megawatt power plant = in=20 the Bay Area. Repairs will probably take several days.=20 "It wrecked my day," said Jim McIntosh, the Independent System Operator=20 director of grid operations. "It just changed the whole perspective of what= =20 was going on."=20 The loss of the 750 megawatts deepened concerns in Folsom, where ISO=20 engineers measured a peak afternoon demand that barely trailed supplies of= =20 almost 34,000 megawatts.=20 As late as 3 p.m., grid officials expected to be forced into cutting servic= e=20 to hundreds of thousands of homes and businesses. Cooling temperatures and= =20 conservation efforts helped kill the last threat, McIntosh said.=20 More blackouts could be ordered today, however, and tomorrow may be just as= =20 problematic.=20 "The next couple of days will certainly be impacted by the loss of that=20 unit," McIntosh said.=20 The latest breakdown added to some already high drama at utility companies,= =20 where officials braced through the day for orders to cut power to hundreds = of=20 thousands of customers.=20 Blackout orders never came. But executives at San Diego Gas and Electric Co= .=20 spent the day on heightened alert, calling critical-need residents and=20 businesses and informing them of potential service interruptions.=20 "This has become relatively commonplace," SDG&E spokesman Douglas Kline sai= d.=20 "We handle it as a matter in the course of business now, unfortunately. We'= ve=20 been on high alert all day."=20 Service was cut to more than 23,000 customers in several San Diego-area=20 neighborhoods Monday and Tuesday afternoons. More than 500,000 homes and=20 businesses across the state also lost power.=20 In a power interruption unrelated to the power problems across the state, a= =20 number of major businesses in downtown San Diego were cut off unexpectedly = in=20 midafternoon.=20 Customers between F Street and Harbor Drive lost power about 3:15 p.m. when= =20 something went wrong with an underground cable that serves, among others, t= he=20 Marriott Marina hotel, SDG&E said.=20 Service was restored within two hours, but not before convention meeting=20 rooms went dark and hotel restaurants closed.=20 The heat wave that has hung across California the past three days is expect= ed=20 to begin cooling today and tomorrow, the National Weather Service said. Tha= t=20 should reduce demand for air conditioning, one of the biggest power draws i= n=20 the state.=20 However, the constant uncertainty in the electricity industry is taking its= =20 toll on local businesses, which not only are seeing huge run-ups in utility= =20 costs but are girding for potential losses that even a few minutes of=20 interruptions can cause.=20 "From a business standpoint, it's not 15 minutes of downtime for many of ou= r=20 companies," said Julie Meier Wright, president of the San Diego Regional=20 Economic Development Corp. "For many of them, it means the loss of hours,= =20 days, weeks and even longer of work."=20 Biggest users face huge rate hikes under PUC plan=20 By Karen Gaudette ASSOCIATED PRESS=20 May 9, 2001=20 SAN FRANCISCO =01) Customers of California's two largest utilities who use = the=20 most electricity would pay much more to run canneries, tumble laundry and= =20 conduct other tasks under a tiered rate plan implementing record hikes=20 approved in March.=20 The rate plan proposed Wednesday by Loretta Lynch, president of the state= =20 Public Utilities Commission, suggests how the rate hikes should be allocate= d=20 among residential, industrial, commercial and agricultural customers.=20 Residential customers of Pacific Gas and Electric Co. and Southern Californ= ia=20 Edison Co. who use the most electricity would face average rate hikes of 35= =20 percent to 40 percent.=20 And industrial users, such as factories and food processors, could face hik= es=20 of 50 percent or more as the state desperately tries to start recouping the= =20 $5.2 billion it already has paid to buy power for customers of those=20 financially ailing utilities.=20 Still, under Lynch's plan, as many as half of the 9 million customers of PG= &E=20 and SoCal Edison would not see their bills rise at all.=20 Lynch's plan is the culmination of weeks of discussion among customers, sta= te=20 officials, consumer activists and the utilities about how best to allocate= =20 the record rate hikes approved in late March by the PUC.=20 Those rate hikes will affect all classes of customers, from small families = to=20 the huge Silicon Valley facilities powering the Internet, but not all will= =20 face the same magnitude of rate increases.=20 And, even within those classes, customers will pay more depending on when= =20 they use the electricity. Those who use power during times of highest deman= d=20 =01) generally, during daylight hours =01) will pay the most.=20 Lynch said her plan "recognizes that energy is expensive at every hour of= =20 every day by every customer," but penalizes those who do not cut back on=20 energy use or try to shift to different times of the day.=20 Under Lynch's proposal, agricultural customers could face rate hikes rangin= g=20 from 23-30 percent, with increases capped at 30 percent. Industrial users= =20 face average increases of 50 percent or more, and commercial users average = 34=20 percent to 45 percent hikes.=20 Her proposal, Lynch said, designs rates to encourage conservation and=20 provides $5 billion over the next year to help pay the state Department of= =20 Water Resources for the billions it has spent providing electricity for=20 customers of PG&E and Edison.=20 Lynch left the door open for future rate hikes, noting that the state=20 provides its electricity-buying expenses to the commission only on a monthl= y=20 basis, while wholesale electricity prices continue to soar.=20 Lynch's proposal, and a largely similar proposal from PUC administrative la= w=20 judge Christine Walwyn, will be reviewed in public hearings throughout the= =20 state the rest of this week.=20 Rate Hikes Up to 60% Proposed by PUC Chief=20 Power: Lynch says about half the residential customers of Edison, PG&E woul= d=20 escape increases. Her plan draws fire from all sides.=20 By TIM REITERMAN and NANCY RIVERA BROOKS, Times Staff Writers=20 ?????SAN FRANCISCO--About 4 million California residential electricity=20 customers will face increases in their monthly bills of up to about 60% und= er=20 a proposal unveiled Wednesday by the state's chief utility regulator.=20 Interest groups on all sides promptly condemned the plan as too hard on=20 either consumers or businesses. ?????The proposal by California Public Utilities Commission President Loret= ta=20 Lynch would increase the bills of roughly half of Southern California=20 Edison's residential customers, who consume medium to heavy amounts, by $8 = to=20 $93 a month. Pacific Gas & Electric Co. customers would be hit with hikes o= f=20 $6 to $87 a month. Elisabeth Charion is among about 70 people testifying at a PUC hearing=20 Wednesday in Fullerton, most venting their anger at elected officials and= =20 utility companies, whom they blame for the crisis. IRFAN KHAN / Los Angeles Times ?????About half of the residential customers of the state's two biggest=20 public utilities would see no increase under the proposal if they continued= =20 to consume energy at their current pace. ?????Lynch said she could not guarantee that more rate increases would not = be=20 necessary. "Even these astronomical average rates may prove inadequate," sh= e=20 said, noting that wholesale electricity prices are still high and=20 unpredictable. ?????The rate hike, Lynch said at a news conference, is necessary because= =20 "federal regulators have failed to follow federal laws to ensure just and= =20 reasonable prices." ?????The deepening energy crisis compelled Lynch to release her proposal=20 after public hearings on the rate increase already had begun. Lynch said th= at=20 she wished her proposal had been ready sooner, but that at least some of th= e=20 remaining public hearings will have the benefit of reviewing it. ?????PUC passage of the essential elements of Lynch's plan seems likely. ?????Along with two of her colleagues on the five-member commission, Lynch= =20 was appointed by Gov. Gray Davis, and they often vote as a bloc. Lynch said= ,=20 however, that testimony later this week from utilities, the public and othe= r=20 interested parties could prompt modifications. ?????Structuring the $5-billion rate increase is an important but political= ly=20 sensitive step in California's attempt to restore stability to the delivery= =20 of power to 9 million customers of two financially troubled utilities while= =20 protecting the state budget. ?????The PUC has tried to design rates that would encourage conservation=20 without damaging business. Competing interest groups, ranging from consumer= =20 advocates to large manufacturers, have been jockeying for advantage for wee= ks. ?????The PUC approved a rate increase of 3 cents per kilowatt-hour March 27= =20 to help pay the state's mounting power tab, which now exceeds $5 billion.= =20 This week, the commission is conducting statewide hearings on how the pain= =20 should be shared among millions of residents and businesses. On Monday the= =20 panel is set to vote on Lynch's plan and a similar one by a PUC=20 administrative law judge. ?????Neither proposal appeared to please anyone. ?????"The PUC says everyone should share the pain, but we think the fair=20 share of the pain for residential consumers should be zero," said Mindy=20 Spatt, spokeswoman for the Utility Reform Network, a San Francisco consumer= =20 group. "It should be paid by commercial and industrial customers who wanted= =20 and still want deregulation." ?????Consumer activist Harvey Rosenfield said regulators should go after=20 power generators and their hefty profits rather than ratepayers. ?????"Rate increases are not the answer, and this is not going to be the en= d=20 of them," said Rosenfield, president of the Foundation for Taxpayer and=20 Consumer Rights in Santa Monica. "This is like organized crime: The more yo= u=20 give them, the more they want." ?????Commercial and industrial customers would see increases of up to 50%,= =20 and agricultural interests would face increases of 23% to 30% under Lynch's= =20 proposal. ?????Business interests contend that the rate hikes hit them much harder th= an=20 residential users. ?????Calling the proposal "a death knell for the California economy," Jack = M.=20 Stewart of the California Manufacturers and Technology Assn. estimated that= =20 industrial customers would see their power rates increase an average of 53%= .=20 And the pain of the rate hikes will be compounded by blackouts this summer,= =20 which the group contends will cost California businesses $21.8 billion in= =20 lost productivity. ?????"For most large manufacturers, energy is a large piece of their=20 operating costs," Stewart said. "If you add 53% to that, it's going to=20 severely hamper their ability to do business." ?????Unlike residential customers, the business customers are not grouped= =20 into tiers based on their amount of usage. Lynch said there was insufficien= t=20 time to establish a tiering system for nonresidential customers by June 1,= =20 when the rate hikes will start showing up on bills. ?????An earlier proposal by Lynch had attempted to narrow the gap between= =20 residential rates and the lower rates paid by nonresidential customers. But= =20 the commission president said that goal could not be immediately achieved= =20 without seriously damaging the state's economy. ?????To protect the largest users from gigantic rate increases, Lynch's=20 proposal caps the maximum bill increase at 300% for most customers and 250%= =20 for agricultural customers. ?????"While we understand bill limiters may have some troubling conservatio= n=20 impacts, at some point, price signals are unbearable for customers. Bill=20 limiters will protect customers from unanticipated extraordinary bill=20 impacts," Lynch wrote. ?????In recent weeks, the commission has received about 20 plans for=20 structuring the rate increase, including one from Davis, who had proposed a= =20 slightly smaller overall rate increase. Lynch said her plan incorporates a= =20 number of features of the governor's plan, including a tiered structure tha= t=20 would punish heavy users and reward those who conserve. ?????Under state legislation, there is no rate increase for consumption up = to=20 130% of baseline, the amount deemed the minimum needed by a customer in a= =20 given area and noted on ratepayer bills. Also exempted are low-income=20 customers who already receive discounted electricity rates. ?????Edison and PG&E said they could not assess how the PUC proposals would= =20 affect their customers because the commission had not provided details to t= he=20 utilities as of late Wednesday. ?????But PG&E has disputed the commission's claim that half of customers=20 would not be affected by the increase, noting that only 32% of PG&E custome= rs=20 never exceeded 130% of baseline usage in the last year. ?????Industrial and commercial customers complained that the plan should no= t=20 exempt such a large group of residential customers, in any event. A rate=20 increase for these users--based on the PUC's estimate that the group will= =20 constitute about half of residential customers--could generate an extra $1= =20 billion. ?????If the PUC insists on exempting so many, the $1-billion shortfall shou= ld=20 be covered solely by other residential users, businesses say. ?????Under Lynch's plan the burden of paying that amount would be split=20 equally among commercial, industrial and nonexempt residential customers. ?????If covering the shortfall were not shared by the three groups, Lynch= =20 said, some residential customers would suffer a 100% increase in their bill= s. ?????The proposal calls for a pilot program, including one that would let= =20 federal agencies based in California "experiment with their own market rate= =20 policies." ?????Lynch challenged federal agencies to try to live with "real time," or= =20 hourly, prices in the volatile wholesale marketplace--a slap at officials o= f=20 the Federal Energy Regulatory Commission who favor a free wholesale market= =20 over price caps. Use of real-time pricing requires installing a special met= er. ?????"'It would be great if the federal users respond to price signals enou= gh=20 that prices come down," Lynch said, adding that she was skeptical that woul= d=20 happen in today's dysfunctional market. ?????A FERC spokeswoman declined to comment on Lynch's proposal. ?????During the third day of PUC hearings, about 200 people gathered at=20 Fullerton College. Seventy people testified, most venting their anger at=20 elected officials and utility companies, whom they blame for the state's=20 flawed deregulation plan. ?????"I am opposed to any rate increase for residences and small business,"= =20 testified Ruth Shapin, a Santa Ana attorney. "This crisis was created by=20 politicians. PG&E and SCE have transferred billions of dollars to their=20 parent companies. Let them bail themselves out, not the ratepayers." ?????Others said the baselines might be unfair because the commission had n= ot=20 taken into consideration home size, the number of occupants and the locatio= n. ?????"It's going to be hard for many people to stay below the 130% baseline= ,"=20 said Sylvia Hartman of Lakewood. "Some customers could easily go 400% over= =20 the baseline." ---=20 ?????Reiterman reported from San Francisco, Rivera Brooks from Los Angeles.= =20 Times staff writer Dan Weikel in Fullerton contributed to this story. Copyright 2001 Los Angeles Times=20 Bush Energy Stance Begins to Worry Some in GOP=20 By GREG MILLER and RICHARD SIMON, Times Staff Writers=20 ?????WASHINGTON--As power shortages and price spikes spread beyond=20 California, congressional Republicans are beginning to worry that the Bush= =20 administration's reluctance to offer much immediate relief could hurt the= =20 party in the 2002 elections. ?????A national energy plan to be unveiled by the White House next week wil= l=20 focus on long-term strategies. But with California and other states bracing= =20 for a summer of electricity turmoil and gasoline prices surging across the= =20 country, some GOP lawmakers are pressing for short-term solutions. U.S. Rep. Mary Bono, left, and Gov. Gray Davis discuss meeting with=20 executives of power-generating companies. Bono plans to seek $100 million t= o=20 help poor people pay energy bills. AP ?????"The White House has been taking a look at the big picture," said a GO= P=20 leadership aide in the House. "But they're going to be around in four years= .=20 We might not have members around in two years if we don't show we care." ?????That sentiment is being voiced by a rising number of GOP lawmakers.=20 "We're in a crisis situation, which is only going to get worse if we don't= =20 act very aggressively," Rep. Elton Gallegly (R-Simi Valley) said Wednesday.= =20 Gallegly is one of four congressional Republicans from California to break= =20 with the administration by supporting temporary price controls on wholesale= =20 electricity. ?????The rising anxiety, which has begun spreading beyond the California=20 delegation, underscores how much has changed since the state declared its= =20 first Stage 3 power emergency in December. At that time, Congress' response= =20 was largely: That's Gov. Gray Davis' problem. ?????Not anymore. ?????Thirty-nine Stage 3 alerts later, a House committee today will take up= a=20 GOP-drafted emergency bill that would, among other things, allow Davis to= =20 temporarily waive certain emission standards for power plants during an=20 emergency and provide federal aid to relieve a notorious bottleneck in the= =20 California power grid. ?????But some GOP lawmakers say the legislation doesn't go far enough, and= =20 plan to offer amendments containing their own ideas. Rep. Mary Bono (R-Palm= =20 Springs) plans to push for $100 million in energy assistance to low-income= =20 households and for a directive to federal facilities in the West to cut=20 energy use by 20%. ?????"House leaders recognize that they could lose the House in California = if=20 there's not an action plan that members can campaign on," said Scott Reed, = a=20 GOP strategist. ?????As lawmakers search for ways to provide immediate relief, the White=20 House continues to cite California's troubles as evidence of the need to=20 upgrade an aging, overburdened electricity transmission system. ?????Responding to reports that the administration would propose legislatio= n=20 to give the federal government eminent domain authority in siting power=20 lines, White House press secretary Ari Fleischer said Bush wants to ensure= =20 that the distribution infrastructure can move electricity from regions with= =20 surpluses to regions that need more power. ?????"That's one of the reasons that California is going through the=20 difficulties it's going through," Fleischer said. "There is energy availabl= e=20 in other parts of the country, but it can't be shipped to California as=20 easily as you would hope, because of infrastructure problems." ?????Fleischer took exception to a front-page story in The Times reporting= =20 that Bush, in a speech delivered Tuesday, "offered no hint of what his=20 administration might do" to help California avert a possible economic=20 downturn caused by power blackouts. ?????Though the president did not specifically mention possible actions in= =20 the speech, Fleischer said Bush last week "announced a series of steps,=20 including conservation," to help California get through an energy crisis th= is=20 summer. ?????He said that the Pentagon is reducing its energy needs within Californ= ia=20 by 10% and that all other federal agencies, at Bush's direction, are=20 reviewing their energy consumption patterns. ?????Environmentalists already have begun blasting the administration's=20 energy plan--even before its details are made public--for what they=20 characterize as a failure to emphasize energy efficiency and investments in= =20 renewable fuels. ?????Activists Say Crisis Isn't Real ?????At a Wednesday news briefing, a coalition of environmental advocates= =20 disagreed with the administration's assertion that the country is=20 experiencing an energy "crisis," and accused it of crafting a plan designed= =20 to boost the profits of key campaign contributors. ?????"We cannot drill our way out of this situation," said Dan Becker of th= e=20 Sierra Club. He and others argued that conserving fuel--with cars that use= =20 less gasoline and appliances that use less electricity, for example--is the= =20 best way to avoid energy shortages in the short term. ?????So far, it is not clear whether the energy crisis will work to either= =20 party's advantage. Many on Capitol Hill are bracing for an election year th= at=20 could be brutal for incumbents of both parties if voters who endure high=20 energy bills this summer vent their frustration in the voting booth next ye= ar. ?????Some House Republicans acknowledged that they have been pushing the=20 White House to appear more engaged in finding near-term solutions. ?????When House Republicans met with Cheney last week, "they urged him and= =20 all the administration to at least make it clear that a lot of effort is=20 going into finding a way to solve the problem," said Jim Specht, a spokesma= n=20 for Rep. Jerry Lewis (R-Redlands), leader of the California GOP delegation. ?????Though some Republicans have offered ideas to address the immediate=20 problem, it is not clear whether any will receive congressional approval. ?????Indeed, the emergency assistance bill being taken up today by the Hous= e=20 energy subcommittee faces trouble, although it was drafted by the panel's= =20 chairman, Rep. Joe Barton (R-Texas). ?????Barton stripped out a number of provisions opposed by environmentalist= s.=20 But Democrats plan to seek a vote on capping wholesale electricity prices, = a=20 proposal most Republicans oppose. Democrats also plan to introduce an=20 amendment to target natural gas prices. ?????House Minority Leader Richard Gephardt (D-Mo.) said the bill "fails=20 miserably" to address California's problems. "During the campaign, Presiden= t=20 Bush promised a sensible energy policy," Gephardt said. "In recent weeks,= =20 however, the president has responded to the gathering crisis by throwing up= =20 his hands and saying there's nothing we can do, there's no way to give peop= le=20 immediate relief from blackouts and sky-high increases of price of gasoline= =20 at the pump." ?????Lawmakers of both parties acknowledge that they are hearing a rising= =20 chorus of constituent complaints about the energy price spikes and supply= =20 shortages. ?????Rep. Chris Cox (R-Newport Beach) was caught in a blackout during a tou= r=20 of a computer chip factory in his district. "They said it cost them $1=20 million if the power goes off even for five minutes," said Cox, who=20 nonetheless opposes price controls. ?????Cox said he is worried about how the California electricity crisis mig= ht=20 affect the national economy. He said that when he asks business owners abou= t=20 expanding in California, "they just look at you like you're nuts. They don'= t=20 consider California an option because of this uncertainty." ?????"People come up to you and want you to help solve the problem," said= =20 Rep. George Radanovich (R-Mariposa). ?????He has explained that there is little the federal government can do in= =20 the short term. ?????"Californians want somebody to do something," said John J. Pitney Jr.,= =20 associate professor of government at Claremont McKenna College. "When peopl= e=20 are in a mood like that, politicians get nervous thinking that they're the= =20 ones who might get blamed." ?????Said Reed, the GOP strategist: "Every incumbent in California is=20 vulnerable in the next election, in both parties. This is an issue that is= =20 not ideological. It's about action and solving a short-term problem.=20 "Politics have taken over this issue, like it or not," he said. "They may= =20 have been raging in California for the last three or four months. It's now = a=20 national political issue."=20 ---=20 ?????Times staff writers James Gerstenzang, Edwin Chen, Elizabeth Shogren a= nd=20 Ricardo Alonso-Zaldivar contributed to this story. Copyright 2001 Los Angeles Times In Office Buildings, the Lights Are On, But Nobody's Home=20 Energy: Analysts say metering individual tenants could encourage=20 conservation.=20 By JERRY HIRSCH, Times Staff Writer=20 ?????Despite power outages and soaring energy prices, workers stream out of= =20 California's downtown and suburban offices each evening leaving lights=20 blazing and computers humming. And there has been scant incentive to=20 conserve, since commercial building leases typically include the cost of=20 energy. ?????Energy experts and other analysts say metering of individual office=20 tenants would encourage conservation by pushing companies to shut off light= s,=20 computer monitors, desk fans and other electrical devices at night, but sta= te=20 regulations and utility policies are in the way. ?????That conflict between policy and conservation efforts has drawn the=20 attention of state Sen. Debra Bowen (D-Marina del Rey), who chairs the Sena= te=20 Energy, Utilities and Communications Committee. On Tuesday, Bowen asked=20 California Public Utilities Chairwoman Loretta Lynch to review what Bowen= =20 called "archaic" regulations governing how electricity meters are used in= =20 office buildings. Bowen said she also plans to take up the issue in her=20 committee. ?????At issue is Rule 18, a regulation established by the commission two=20 decades ago that prohibits landlords from using submeters to assess energy= =20 charges to tenants. ?????"It is quite old and dates back to a different era of electricity=20 distribution in California," said Bowen, who was urged to take action by th= e=20 Building Owners and Managers Assn. "I asked Loretta Lynch to open a=20 proceeding to revise or eliminate that ban." ?????Lynch did not return calls for comment on the state's metering policie= s,=20 but PUC regulatory analyst William Gaffney said more metering "would be a= =20 boon to energy conservation" because "you could see what you are using." ?????"Direct metering would ultimately foster greater energy savings . . .= =20 more permanent savings, because it would encourage capital investments in= =20 more efficient equipment, windows, etc., etc.," said Evan Mills, a scientis= t=20 in the energy analysis department of the Lawrence Berkeley National=20 Laboratory in Berkeley. ?????Usually, the only tenants in office buildings with utility meters are= =20 retail and restaurant businesses, according to commercial real estate=20 experts. Most tenants in California office towers sign what are called "gro= ss=20 leases" that include power. When electricity usage or rates go up=20 unexpectedly, landlords can charge monthly or annual "escalation fees" to= =20 cover the extra cost. The fees typically are apportioned by the percentage = of=20 the building a tenant occupies. ?????This method of billing is counterproductive to energy savings, said=20 Willet Kempton, senior policy scientist at the University of Delaware's=20 Center for Energy and Environmental Policy. Energy hogs are subsidized by= =20 other tenants. Conversely, savings through conservation are only fractional= ly=20 shared. ?????Two key obstacles block metering of individual tenants in a building. ?????One is economics--high-rise buildings get a far better rate with one= =20 utility meter than if each floor is metered. ?????"We can sell a lot of energy on just one bill," said Randy Howard,=20 manager of commercial services at the Los Angeles Department of Water and= =20 Power. "If we had 200 meters there and had to do the billing and meter=20 reading for each of them, each tenant would pay a higher rate." ?????Moreover, utilities aren't anxious to send meter readers to every floo= r=20 of a building, going through private offices to find the meters. One=20 alternative--locating all the meters in a central area where the main=20 electrical line enters the building--would require massive rewiring of=20 existing office towers that could cost several hundred thousand dollars or= =20 more, depending on the size of the building, said Ali Sherafat, senior vice= =20 president of the Los Angeles office of Syska & Hennessy, a consulting=20 engineering firm. ?????A 1995 ruling by the PUC required that individual tenants in office=20 buildings be placed on meters operated by a public utility (as opposed to= =20 landlord-managed submeters), but relatively few have been installed because= =20 of exemptions. ?????For example, Southern California Edison Co. officials typically meet= =20 with developers at the start of a building project to determine how many=20 meters it might require, said Matt Deatherage, a planning support manager f= or=20 the utility. But because developers build office space so that its=20 configuration can change easily as tenants shift, the estimate is often=20 wrong. A building designed with three meters for three tenants might find= =20 itself with six tenants or more by the time it opens. ?????"We don't require them to go back and rewire the building if it turns= =20 out to be wrong, that would be too expensive," Deatherage said. ?????The second obstacle is Rule 18, the 1981 ban on submetering originally= =20 intended to protect utility monopolies and to prevent landlords from gettin= g=20 electricity at a discount price and selling it at a markup to tenants. ?????"When you resell electricity like that, you function as a utility and= =20 that's not allowed," said Deatherage. ?????Nonetheless, Bowen believes that deregulation may have superseded thos= e=20 issues and that current policy should emphasize conservation. ?????Although the leasing model used in California is common, it's not=20 universal, said Peter L. DiCapua, energy chairman of the Building Owners an= d=20 Managers Assn. International. ?????Many New York tenants have individual meters. Others are on landlord= =20 submeters, a system that allows them to tap into the lower, high-volume rat= es=20 paid by the building's operator but still pay for actual, rather than=20 estimated, energy use.=20 ?????Landlords would welcome a changed regulation to allow submetering for= =20 several reasons. There are the conservation benefits, said Dan Emmett, chie= f=20 executive of Douglas Emmett & Co., one of the largest building owners and= =20 managers in Los Angeles County. It also would reduce some of the inevitable= =20 arguments with tenants who claim they pay more than their fair share for=20 services at a building. ?????"I think submetering could be practical," Emmett said. "It is not that= =20 complicated and is fairly inexpensive." ?????Sherafat said it would cost about $2,000 per tenant for the submeter a= nd=20 the necessary software. Submeters could be installed at the electrical pane= l=20 level without expensive rewiring for utility meters, he said. Better yet, t= he=20 software allows data to be collected at a central point, eliminating the ne= ed=20 for meter readers. Such a system also could allow big buildings to use one= =20 master meter to get the best rate . ?????Though submetering would foster conservation, it still is not a panace= a,=20 said Kempton of the University of Delaware. When it comes to energy=20 conservation, changing the behavior of businesses and workers is notoriousl= y=20 tricky. ?????"Attorneys literally can't be bothered with the nuances of energy," sa= id=20 DiCapua, an executive at Atco Properties & Management in New York. "They ar= e=20 focused on things other than if the air conditioning was left on all night. ?????That is typical of professional services firms, because energy is just= a=20 small fraction of their expenses, Kempton said. ?????And individual metering sounds great in theory, Kempton added, but it = is=20 useless if the bill goes to a home office elsewhere or if the on-site manag= er=20 of the firm never sees it. ?????In any push to change the rules, however, people should remember that= =20 the current system was developed for sound reasons, often based on reducing= =20 the expense of constructing buildings and finding tenants the lowest prices= =20 for energy, Howard said.=20 ?????"Right now we are in a conservation mode, so everybody is talking abou= t=20 this," he said. "But that hasn't always been the case, so a single meter fo= r=20 a big building made sense." Copyright 2001 Los Angeles Times=20 Thursday, May 10, 2001=20 Power Shifts to Congress=20 ?????Wholesale electricity prices soared with the temperature this week,=20 jumping to eight times the peak of only three weeks ago. No one knows how= =20 high the price may go when high summer hits. Which makes it all the more=20 intriguing that one of the big power-generating companies is now calling fo= r=20 temporary price caps, which the Bush administration stubbornly opposes.=20 ?????Authority over wholesale power prices rests with the Federal Energy=20 Regulatory Commission, which is charged by Congress with maintaining "just= =20 and reasonable" rates. But FERC refuses to impose what California desperate= ly=20 needs, a broad temporary price cap that allows companies to recover their= =20 costs plus a reasonable profit. The state's last hope for rate caps now res= ts=20 with Congress.=20 ?????Sens. Dianne Feinstein (D-Calif.) and Gordon Smith (R-Ore.) are=20 sponsoring legislation that would require FERC to establish temporary maxim= um=20 rates. Rep. Henry Waxman (D-L.A.) is scheduled to propose amendments to a= =20 House bill today to do the same. The support of three Republican House=20 members from California, who are on the energy and air quality subcommittee= ,=20 is crucial. They are Christopher Cox of Newport Beach, Mary Bono of Palm=20 Springs and George Radanovich of Mariposa. The Waxman measure serves the be= st=20 interests of California. Concern about losing seats in Congress may also he= lp=20 the GOP members make the right choice.=20 ?????It was Feinstein who got a letter from Keith E. Bailey, chairman of=20 Williams Cos., an energy producer, in support of temporary price controls.= =20 Perhaps some generators are tired of being labeled gougers, pirates and=20 bloodsuckers, and they will settle for a reasonable profit through the rest= =20 of this crisis. But price caps would have to apply to all the producers.=20 Congress must act, starting today with the subcommittee vote on the Waxman= =20 measure. Copyright 2001 Los Angeles Times=20 Proud state forced to knees in power hunt=20 Robert Salladay, Chronicle Sacramento Bureau Thursday, May 10, 2001=20 ,2001 San Francisco Chronicle=20 URL: http://www.sfgate.com/cgi-bin/article.cgi?f=3D/c/a/2001/05/10/MN40227.= DTL=20 California has turned into the trailer park next door, the cash-only,=20 deadbeat neighbor forced to beg for enough power to keep the swamp cooler= =20 running.=20 Yesterday in Folsom, home of the state's energy managers, was another study= =20 in high-tech, air-conditioned humiliation -- punctuated by a frantic scrapi= ng=20 and bowing for energy across the West.=20 Poor people with "secured" credit cards can relate to the scene at the=20 California Independent System Operator. This week began with Canada's BC=20 Hydro threatening to shut off power again until the state actually wired ca= sh=20 to its bank account.=20 "We got the money," an ISO engineer stood up and told another employee at t= he=20 agency's semi-secret Folsom headquarters yesterday. "Yeah, we're good for= =20 another $14 million. Burn it up, huh, Lloyd?"=20 Lloyd started burning it up, thanks to an OK from the Department of Water= =20 Resources and to several million California taxpayers' footing the bill.=20 California narrowly missed a third day in a row of blackout
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