San Diego Leaders Plead for Help on Energy

In an emotional congressional hearing at what some called “ground zero of the energy crisis,” San Diego politicians and business leaders Thursday pleaded for help for the region that was the first to experience skyrocketing utility prices under deregulation.

Rep. Susan Davis (D-San Diego) told members of the House Government Reform Committee’s Subcommittee on Energy Policy that watching families and businesses suffer last summer as bills doubled and tripled was like witnessing “the death of a city.”

One executive told of a hotel that decreased its use of electricity by 4% but saw its bill increase by 300%. “It’s an insane environment,” said Samuel Hardage, owner of Woodfin Suites Hotels.

As the energy crisis spread to Central and Northern California, and with the bankruptcy filing of San Francisco-based Pacific Gas & Electric Co., San Diego County’s plight has received considerably less attention.

Local leaders complain that San Diego is being forgotten as Gov. Gray Davis tends to the woes of more politically powerful regions.

Legislation last summer capped rates for many customers of San Diego Gas & Electric Co., which serves 1.2 million customers in San Diego County and southern Orange County.

But the cap expires Dec. 31, 2003, after which the utility can bill its customers for deferred charges. The prospect of enormous balloon payments has prompted San Diego legislators in Sacramento and Washington to offer a number of rescue plans--but none has been adopted.

It is an old complaint locally: San Diego sometimes seems not to matter in the halls of power.

“The job of any San Diego representative in Sacramento is to always keep San Diego at the [bargaining] table,” said Assemblywoman Christine Kehoe (D-San Diego). “Los Angeles and San Francisco just have delegations that are much bigger and more influential.”

Gov. Davis, visiting San Diego County last week to praise an Escondido elementary school for its energy conservation, pledged that San Diego customers will not face enormous bills when the cap expires. “That will not happen,” he said.

But Assemblyman Juan Vargas (D-San Diego) complained that Davis’ plan to offer rebates to customers who reduce energy consumption by 20% is unfair to San Diego. The Davis plan uses last year’s energy use as a base of comparison, but San Diegans had already started reducing their use, and thus achieving the 20% will be more difficult, Vargas said.

Vargas wants the governor to modify his plan so 1999 could be used for comparisons. Kehoe said she has been told the governor is sympathetic to the idea, but Davis has yet to make a decision.

Rep. Bob Filner (D-San Diego) has introduced a bill to order the Federal Energy Regulatory Commission to set cost-based wholesale rates and order refunds to consumers for what Filner terms unfair overpayments.

At Thursday’s hearing, Filner charged that, so far, FERC’s only reaction to the San Diego-based crisis has been to tell energy generating companies to “go rob the state blind.”

While Filner was criticizing FERC, Rep. Duncan Hunter (R-El Cajon) wanted to release various power generators from air pollution and other standards that keep them inactive for long periods.

“We’ve got to have the right to turn on what we’ve got,” Hunter said.

Michael Shames, executive director of the San Diego-based Utility Consumers Action Network, has called for the Legislature to provide $3.2 billion to buy generating plants found to have been price-gouging.

Shames wants the same treatment for San Diego ratepayers as for the stockholders of Southern California Edison and Pacific Gas & Electric Co. A common complaint in San Diego is that Davis appears more worried about keeping Edison and PG&E; afloat than helping SDG&E; customers.

Even as it was being criticized at the hearing, the San Diego utility was fighting another skirmish in the energy battle, with Houston-based Dynegy.

Dynegy wants SDG&E; to shut down 18 small power plants that Dynegy owns and SDG&E; operates. The utility refused Thursday.

Dynegy is worried that it may never get paid for the energy.

SDG&E;’s contract to run the plants expires next month.

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Times staff writer Nancy Vogel contributed to this story.