Davis Steps Out Front

Gov. Gray Davis, after weeks of near- silence on California’s potentially crippling power crisis, came to grips with it during his annual State of the State address Monday evening. He rightly called it “an energy nightmare” and dramatically vowed even to seize private power plants if necessary to keep the lights on. Davis also broadly outlined many of the lesser steps that experts say must be taken to fix the problems of electricity deregulation--”stating the obvious,” one called it.

Much of what Davis proposed is laudable and needed, but success will come only in carefully crafting a detailed plan. This will require the governor’s close attention as he works with the Legislature on implementation bills.

Davis did right in devoting much of his legislative address to the energy issue, even though he spent considerable time shunning responsibility for the situation and accusing private power generators of price gouging and profiteering. That’s good political rhetoric, but part of the blame should have gone to defects in the deregulation legislation itself.

Davis outlined eight legislative steps he will seek in an attempt to relieve the immediate crisis, stemming from power shortages and soaring wholesale costs that have driven the state’s two biggest private utilities to the brink of bankruptcy. Alas, none of those would act at once to control the wholesale prices that the private generators are charging utilities. The only body with the authority to do that is the Federal Energy Regulatory Commission, which has refused to impose a regional price cap.

Today, during a meeting with President Clinton and other officials in Washington, Davis and others will attempt again to persuade the commission to take such action. But federal officials say the energy commission is not likely to change its free-market position.

Several of the proposals Davis made Monday evening could help ease power costs to utilities and consumers within the next several months, in time for the summer power crunch. They include restructuring an irrational system established by the 1996 deregulation law for the buying and selling of wholesale power.

The governor made a commendable, reasonable plea to Californians to cut back power usage by 7% and pledged to budget $250 million for cash incentives to consumers to replace inefficient air conditioners and other appliances. This figure should be boosted to at least $500 million, and the program should be launched right away rather than waiting for his budget to pass this summer. Davis needs to tour California and be seen talking with consumers as well as switching off the lights in state buildings.

The governor also was forthright about protecting the threatened utilities from bankruptcy, vowing to seize power plants if necessary, presumably in order to make power available to them at cost. Whether he could seize generating plants outside California, however, is questionable, and that’s where much of the problem rests.

It’s good to have Davis out front, assuming responsibility for leadership, after his months of being out of sight on this most critical issue. He should remain in front, fill in the missing details of his plan and work closely with the Legislature to enact its provisions as swiftly as possible.