Electricity Sale Changes

Recent coverage in The Times about California’s restructured electricity market may have left readers confused about the role of investor-owned utilities.

For example, when marketeers put out press releases announcing that they have signed up a customer for the commodity sale of electricity, it has habitually been referred to as a “loss” for Southern California Edison [e.g., “Ralphs Defects From Edison, Signs With New Power Source,” Nov. 14]. This is quite misleading.

Under the new law, SCE will sell all of its electricity to the new power exchange. And all the electricity we provide to the customers we supply will come from the power exchange. We will pass through to the customers the clearing price for the electricity with no markup in profit to us on the commodity. We believe that for most customers, this will be their best choice. But even those who choose another supplier for electricity will still be a customer of SCE for the purpose of transporting electricity, a service we provide to everyone within our service territory under rates regulated by the California Public Utilities Commission.

Residential and small-business customers will receive a 10% reduction in their rates on Jan. 1, financed by rate-reduction bonds authorized under the new law. Thereafter, their rates will be frozen for approximately four years. Contrary to suggestions in advertising by some marketeers, this rate reduction and rate freeze apply to all residential and small-business customers of investor-owned California utilities, and no action is required to receive this benefit.

As a public utility, Southern California Edison has a special concern for consumer protection. We urge all Californians to take advantage of the PUC-sponsored Consumer Education Program being sponsored by the PUC to learn more about California’s newly structured electricity market.

THOMAS J. HIGGINS

Vice President

Southern California Edison