UTILITY DEREGULATION
Saying it will work on an issue of such importance itself, the Pasadena City Council has rejected a staff proposal to appoint a blue-ribbon committee to come up with recommendations of how the city-owned utility will survive the deregulation of the electric industry in 1998.
“The bottom line is we’re elected to deal with these issues,” said Councilman Paul Little, who was among the majority in the 4-to-3 vote.
Pasadena Water and Power General Manager Rufus Hightower warned again on Monday that the utility must consider increasing rates, ending a $13-million annual transfer to the city and making other savings to pay down its massive debt during the next eight years in order to survive.
As deregulation will allow large customers to buy from any provider, he said, the city needs to reduce its costs and eliminate $399 million in debt to stay competitive. These debts are investment contracts requiring the city to pay for power generated by a Utah coal plant and Arizona nuclear plant for decades.
Several council members openly doubted Hightower’s sky-is-falling in scenario. Vice Mayor Chris Holden wondered why none of the other utility-owning cities were so alarmed.
Told they were watching Pasadena’s efforts, Holden replied: “If we go off the cliff they won’t be able to stop.”
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