Power to the people

Bob Finkelstein is executive director of The Utility Reform Network

One of the biggest disappointments of the Schwarzenegger administration has been its failure to live up to its promises about confronting the painful fallout from the electric deregulation disaster.

Candidate Arnold Schwarzenegger criticized then-Governor Gray Davis’ bungling of energy deregulation and promised to both fix the problem and lower electricity rates. Governor Schwarzenegger not only failed to deliver on all counts, but also vetoed broadly supported legislation to set a sensible course for California’s electricity system. Frustrated consumers turned to the ballot box to keep the lights on, encourage conservation, protect our environment and lower electric rates. Now that consumers have stepped into the void with Proposition 80, the governor is scrambling to save face.

Proposition 80 gives voters a choice for California’s energy future: Let the state’s voters take control over our energy agenda and future, or leave it to the unregulated energy companies, which also happen to be big campaign donors. Remember, Enron didn’t just ride in from Texas and rob us—first it lobbied Sacramento for a policy that would enable the company to do so.

Enron may be gone, but the other companies that gamed our electricity and walked away with billions are still around. In the Schwarzenegger administration, they’ve again found a sympathetic ear in Sacramento.

With Proposition 80 shining a light on his inaction, the governor is looking for guidance in all the wrong places. When deregulation melted down in 2000-2001, the chief price-gougers were companies including Duke Energy, Dynegy and AES. So, whom does the governor turn to for help in designing California’s energy future? Duke Energy, Dynegy and AES. This is the same Duke that charged Californians $3,880 for a megawatt that cost the company about $50. Even worse, part of the “solution” these companies seek is to loosen the price caps that finally (and belatedly) reined in their price-gouging in 2001.

These rogue companies are the last places to turn to for advice on energy policy. As former AFL-CIO President John Sweeney said, “Enron is not what happens when you let corporations break the law; it’s what happens when you let corporations make the law.” Rather than let unregulated energy companies make the law again, Californians should support Proposition 80 to chart the course to a more rational and sensible energy future.