Proposition 80 Aims to Regulate Energy Firms

But critics say the problem has been solved and passage would
result in a lack of competition
Gilroy – One side claims Proposition 80 will put an end to market manipulation and black outs. It says the Repeal of the Deregulation and Blackout Prevention Act will ensure that another Enron situation never happens again.

The opposition argues the measure was written in privacy without public hearings, limits price competition and is environmentally unfriendly.

“(Proposition 80) is a very simple goal to make sure we don’t have the price spikes and blackouts that we had under deregulation,” said Mindy Spatt, Communications Director for The Utility Reform Network in favor of the measure. “We don’t want to see greedy electrical companies do to California what Enron did.”

Under Proposition 80, it requires all electricity providers to have enough reserves to keep the lights on.

Supporters claim that the measure would produce lower rates and provide market stability.

“It’s good for small businesses because it’s a level playing field … With the cloud of deregulation hanging over California … we haven’t seen a lot of investment in power plants,” Spatt explained. “The type of competition (created) will be to offer consumers the best value.”

But opponents argue advocates of Proposition 80 are playing on people’s fears by using words such as Enron and deregulation in their campaigns.

“Basically, they’re trying to create an emotional appeal to solve a problem that’s already been solved,” said Dan Pellissier who serves as Campaign Manager for Californians for Reliable Electricity. “The problem that they say they’ve been solving has been solved already.”

Critics argue that Proposition 80 reduces price competition and stability because it locks consumers into contracts.

According to Pellissier, the market has changed since 2000-01, “long-term contracts have already been put into place,” he said.

Current law requires electricity providers to increase their share of electricity generated from renewable resources by one percent per year up to 20 percent of their total supply by 2017.

Supporters of Proposition 80 claim it helps speed up the process by requiring these changes by 2010.

Opponents argue it does not further the goal for improvement.

“It makes it harder to raise the bar in the future,” Pellissier said. “It would cap the renewable goals and would require a 2/3 vote (by legislators) to reverse the goal.”

Among supporters for Proposition 80 include the Consumer Federation of California, California Alliance of Retired Americans and International Brotherhood of Electrical Workers.

Critics of the measure include the Geothermal Energy Association, the Public Utilities Commission and the California Solar Energy Industries Association.


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