California, Electricity, and YOU

A Bill to Repeal the 1996 State of California Deregulation of Electric Companies

  1. Be it enacted that
  2. Section 1: The state of California shall repeal the 1996
  3. Electric Company Deregulation Act.
  4. Section 2: The Bill shall roll back rates to July 1996
  5. rates for one year.
  6. Section 3: This bill recquires the State of California
    7to build new power plants and emphasize solar and wind
  7. energy sources.
  8. Section 4: The cost of this development of new power plants will be shared by the State and the largest industry consumers of electrical power.

Again, for my purposes, this is a real bill. I have no knowledge if this is based on a real bill.

Section 1. Is there a great need to repeal the deregulation act? And if so, what?

Section 2. Why would the bill roll back the rates to the 1996 rates? It cost money to produce electricity.

Section 3. Currently solar and wind power isn’t all that great for creating power. Especially in a state like CA with a large population on the grid.

Section 4. Shared cost, eh? Basically it means that one way or the other the people will be paying for it.


Section 2 - if rates are “rolled back” to 1996, who will provide the power when PG&E decides it’s not going to generate electricity anymore because they lose money on every kW they produce? Or do they get a subsidy?

Section 3 - Well, CA won’t build coal plants, they won’t build nuclear plants, oil is out, wind and solar don’t amount to squat (plus they are some of the most expensive energy sources you can have), so what really will CA do? Throw some more gas turbines into the mix, burning relativly high-cost natural gas, and requiring extensive pollution controls (such as Selective Catalytic Reduction systems) to meet CA smog legislation?

Section 4 - What about O&M (operations and maintenance) costs? Will CA and the largest producers also share the cost of operations, maintenance, and especially fuel? Who owns the plants after they are built? Who accepts liability and the generation commitments? Does CA really fund plants that are ultimately owned by private utilities, or does CA form a “nationalized” electric utility? Or does the whole thing fall apart and they have to buy Megawatts from Utah and AZ at $10,000 per MW-h?

There are some interesting and very difficult questions raised by this simple-appearing language. Where did this come from, BTW?

Be it enacted that I want to pay half as much as I do for my electricity and that I don’t want any power plants around me.

Be it also enacted that anyone who calls me idiot shall suffer some Kwh at the Texas electric chair and I don’t care how much those Kwh cost. (This is a necessary addition to the previous act).

My congress competition. I have to write a speech either for or against this bill, and present it to the rest of the “congress” for points, blah blah blah. If it helps, these bills are written by high school age children.
And thank you Una, and MGibson for your reponses, they helped me a lot.

The first thing I thought about when I read this was, What do you mean by repeal the 1996 Electricity Act? It is an enormously complicated act of which several aspects that have been undertaken cannot be undone, most notably the divesting of power plants by the investor owned-utilities (SCE, PG&E, Sempra).

As Anthracite scratched the surface on, there is a lot more to this then can be solved with the simple language of the bill you posted here. I would be happy to answer almost any questions you may have regarding this as my everyday work is with one of the California utilities working directly in the deregulated energy market.

I fhtis is a real bill, I think you could shoot it down with the old “It’s too vague and costly” argument :slight_smile:

This is economics 101.

  1. Government regulation of rates over the past several decades has:
    a. Put the existing electrical companies in a monopoly position, so efficiency was not a major concern; and
    b. Created a disincentive to capital investment (new power plants)
  2. Once deregulated, the power companies hiked the rates because:
    a. They could, as they (temporarily) still have a near-monopoly; and
    b. Their lack of investment in new power plants means they must buy electricity on the open market (at extremely high cost) to meet increased demand.
  3. The high rates now charged will spur the building of new power plants, as their output is now worth more.
  4. The high rates will also spur new electricity suppliers into the business, who will compete with the established companies by offering lower rates.

Result: For the first few years, California rates will go through the roof, but will eventually drop considerably below the rates being charged now.
Ya want proof? Look at long distance rates. I’m (barely ;)) old enough to recall when you really watched the clock while talking long distance. When AT&T’s monopoly was broken, it was ridiculously chaotic for a few years, but now long distance rates are (relatively) dirt cheap. 'Course, we now have those morons calling us at dinner time to get us to switch services, so you decide whether it’s worth it.