Electricity Deregulation Hearing Set : Utilities: Orange County residents get a chance to hear about a controversial proposal to give customers option to shop for their energy supplier.

Orange County residents will have an opportunity Wednesday to learn firsthand about a controversial proposal by the California Public Utilities Commission to deregulate the state’s electric industry.

The plan would allow consumers to select their own electricity suppliers in the same way they now choose their providers of long-distance phone service. The issue will be discussed at a public hearing scheduled by the commission at 7 p.m. Wednesday at the Garden Grove Community Center, 11300 Stanford Ave.

“The industry has changed to the point where the commission believes it has to change its regulation,” said Dianne Dienstein, a commission spokeswoman. “Electric rates in California are too high.”

Under the agency’s proposal, all industrial, agricultural, commercial and residential customers of Pacific Gas & Electric, San Diego Gas & Electric, Southern California Edison, Sierra Pacific and Pacific Power and Light would be able to purchase electricity directly from any supplier, based on competitive prices and services tailored to their needs. They would also have the option of staying with their local utility company, which under the proposal would have its rates regulated by the utility commission according to performance, efficiency and rate of inflation rather than costs, as now is the case.

The largest industrial customers, according to the proposal, would have “direct access” to electricity suppliers beginning in 1996, with all other commercial customers following in 1999. By 2002, the proposal suggests, all consumers--including residential customers--would have the ability to choose their own electricity suppliers.

California’s electric utilities have expressed hope that any dramatic changes by the state be well thought out.

“We need to keep reminding ourselves that what comes out of this proceeding will have a far-reaching effect on people, businesses and communities throughout California,” John E. Bryson, chairman and chief executive of Southern California Edison Co., said at a public hearing held earlier this year on the subject.

PUC officials say the proposed restructuring would lower electric rates significantly through competition, create jobs and improve California’s economic strength.

Some environmentalists and advocates for low-income customers, however, oppose the proposal as vague, environmentally unsound and economically unfair.

“We’re all for competition,” said Lori Jablonski, a spokeswoman for the Center for Energy Efficiency and Renewable Technologies, an independent nonprofit advocacy group that is spearheading opposition to the proposal. “But we don’t think the plan as written will be good for California.”

Specifically, she said, her group opposes the proposal on at least four counts:

* That it would “re-establish a direct link” between utility profits and electricity sales, “thereby removing any incentives for energy-efficient investments and conservation.”

* That customers would be tempted to look elsewhere for cheaper sources of electricity, such as coal production in Wyoming or Utah. “You would have coal power in Utah providing electricity for California customers,” Jablonski said. “In other words, we’ll dirty the sky in Utah for cheap electricity in California.”

* That huge industrial customers will “lock up” good electricity deals in the first several years, during which individual residential consumers will be left to suffer increased costs caused by the larger customers’ retreat from regulated fixed-cost providers.

* That the increased emphasis on lowest prices in the short term would encourage utility companies to eliminate special programs to assist low-income people who otherwise couldn’t afford service.

Most of those issues are likely to be explored during a series of public hearings that began this week and are scheduled through Nov. 10. In addition to Garden Grove, hearings have been held or are scheduled in Bakersfield, Ventura, Carson, San Bernardino and Huntington Park.

“The commission is seriously considering all the alternative proposals as well as the comments the public is making,” Dienstein said. While the commissioners had originally hoped to reach a decision this year, she said, the complexity of the issue now makes action unlikely until early 1995.

“The challenge to the commission,” Dienstein said, “is to see whether this is a good idea or whether it requires any modification.”