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Jan 14, 2001
CONTACT: Doug Heller - 310-392-0522 x309
D.C. Energy Deal Said to Include $10 Billion Bailout of Utilities
Consumer Advocates Set Out Four Requirements To Ensure Ratepayer ProtectionLos Angeles-- The "deal" announced last night by Governor Davis after days of meetings with federal officials and utility company executives will force California ratepayers to spend an extra $10 billion to bail out Edison and PG&E from the effects of deregulation unless the Legislature protects the public, or the public reverses the deal through an initiative or referendum.
As part of the two-pronged energy deal, the state will function as the utilities' bank and purchase energy from power generators at a fixed, long-term price. (The price and length of the contracts, if determined, have not yet been disclosed.) The state will then sell the energy to the utilities for distribution to customers. As the deal has been reported, ratepayers will be locked into the frozen rate for a number of years.
The Foundation for Taxpayer and Consumer Rights (FTCR) outlined four requirements that the California Legislature must meet to ensure that this deal does not force the taxpayers or ratepayers of the state to pick up the tab for the deregulation fiasco:
The consumer advocates called on the public to join in a petition to state lawmakers to prevent a ratepayer bailout.
"The Legislature must protect ratepayers against having to bailout the utilities once more. If our elected officials do not protect us, ratepayers will be forced to undo the deal at the ballot box through an initiative or referendum," the advocates said.
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