PUC Delays Plan to Lift Rates
Big-box retailers, factories and other large electricity users Thursday won at least a one-year reprieve from a plan by state regulators that would increase their electricity rates when hot weather spurs high consumption.
On a 4-0 vote, members of the California Public Utilities Commission followed an administrative law judge’s recommendation to delay until the summer of 2006 or 2007 a proposal that would allow utilities to as much as triple rates for high-volume industrial and commercial customers for short periods.
The judge said large power users didn’t have enough time this year to prepare for paying the higher rates or, alternatively, shutting down their facilities to save money.
PUC commissioners, led by President Michael Peevey, had asked the state’s three investor-owned utilities to draw up so-called critical peak pricing schedules as a tactic to help avoid potential blackouts if electricity supplies run short. The utilities are Pacific Gas & Electric Co., a unit of PG&E; Corp.; San Diego Gas & Electric Co., a unit of Sempra Energy; and Edison International’s Southern California Edison Co.
Business lobbyists said they were pleased with the PUC’s decision and were determined to argue against a similar proposal if it comes back next year.
“We think it’s punitive and hurts large customers. Many operate continuous processes, 24-7, on a 365-day-a-year basis,” said Joe Lyons of the California Manufacturers & Technology Assn.
Michael Shames of the Utility Consumers Action Network said he expected Peevey to keep pushing for the new pricing as part of the PUC’s effort to rely on market mechanisms to reduce energy demand at key times.
