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Calif. regulator calls for 40% rate increase

March 26, 2001
Web posted at: 3:13 PM EST (2013 GMT)

SAN FRANCISCO (AP) -- California's top power regulator on Monday 
proposed a 40 percent increase in electricity rates, saying it 
would encourage enough conservation to get the state through the 
summer. 

Loretta Lynch, president of the Public Utilities Commission, 
said rates should increase by an average of 3 cents per kilowatt 
hour. The current rate averages 7.5 cents per kilowatt hour. 

The higher rates could go into effect as early as Tuesday, 
when the commission meets. Lynch and two other members of the 
five-member commission were appointed by Gov. Gray Davis, and 
Lynch's proposal is expected to be approved by the commission. 

Lynch said the increase was needed to avoid significant power 
problems this summer. 

"That number should be all that is needed going forward, to 
keep utilities solvent and ensure that the treasurer of the 
state can issue bonds," she said. 

Any increase would be on top of the 9 percent to 15 percent 
rate increase the commission approved in January, and an 
additional 10 percent increase already scheduled for next year. 

Several lawmakers have said a rate increase is inevitable. 

"It's obvious to me that unless you rob a bank or win a lottery 
you are not going to be able to do this without raising rates," 
said Senate President Pro Tem John Burton of San Francisco. 

Lynch also supports a "tiered" system that would charge 
residential and businesses customers more if they're large 
power users and fail to cut back. 

Southern California Edison Co. and Pacific Gas & Electric Co. 
both have pushed for rate increases, and PG&E has said its 
current rates would be insufficient to cover its bills and the 
state's. 

Administration officials have been negotiating with PG&E, Edison 
and San Diego Gas & Electric about purchasing the cash-strapped 
utilities' transmission lines to give the companies cash to pay 
their bills. 

PG&E and Edison say they've lost more than $13 billion since 
last summer due to high wholesale electricity costs that 
California's 1996 deregulation law prevents them from collecting 
from their customers.
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(ken)

When will this insanity stop? Does raising rates really
discourage use and encourage people to conserve? Is this
a sham? 

Did gasoline prices ever go back down?

Coming to a city near you soon!


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