Governor Schwarzenegger's Worst Possible Rerun: Energy Deregulation

Few reruns could be more unwelcome than a rerun of deregulation, and even fewer have been outlawed by the Legislature. But if the Governor and his representatives on the CPUC have anything to say about it, we'll all suffer through a remake of one of the worst chapters in our state's history, regardless of the law that prevents it.

Back in 2001, when California was still reeling from rolling blackouts and market manipulation, state law was changed to forbid a return to deregulation in the foreseeable future. In the past six years, that law has helped California stabilize its electric market and focus on the important goals of conservation and renewable energy. But it is a thorn in the side of the big energy companies, who have the ear of the Governor even as they find fewer and fewer audiences for their deregulation fantasy.

Although many states backed away from deregulation in the wake of California's failed experiment, Texas, Illinois and a few others didn't learn from our mistakes and made the same ones themselves. In those states and across the country, deregulated bills are skyrocketing, consumers are on the warpath and state legislators are desperately seeking solutions.

The time would seem to be all wrong for another experiment in California- not only does state law forbid it, but we should have learned something from the first go-round that began in 1996, when Jeffery Skilling and Ken Lay were feted as saviors and visionaries in Sacramento. But the energy companies know they have a friend in the Governor's cigar tent, and don't want to risk waiting until the political winds change. They're going for an end run, with the Governor's blessing.

The Governor has made his position clear not only in public pronouncements but also by appointing CPUC Commissioners who wear the same free market blinders he does. With their vote last week to reconsider deregulation, those Commissioners are poised to subvert the will of the Legislature and risk driving consumers' bills even higher than they already have been driven.

There are a few things that are abundantly clear about the CPUC's decision:

• It thumbs its nose at the Legislature

• It creates substantial and immediate uncertainty about the energy market in California

• The actions it contemplates will inhibit rather than promote California's efforts to cut emissions and promote renewable energy

• It comes from the same big commercial and industrial interests it came from the last time, including several of the same energy companies whose manipulation of the market wreaked havoc in California just a few years ago.

Equally clear is the legislative intent to shut the door on deregulation, despite CPUC blather about being unsure that the statute that says "no more" means no more. Thus far all attempts to reintroduce deregulation in the Legislature have been quickly and firmly rejected, to the relief of beleaguered Californians.

When something as big and costly as electric deregulation is on the table- California's last blunder cost consumers upwards of $40 billion- the very least the public can expect is accountability. It is our elected representatives, not the Governor's political appointees, who have the responsibility and jurisdiction to determine whether or not our state should risk another experiment. They have determined that a rerun of deregulation is not in our state's interests at this time, and the CPUC has neither the authority nor any mandate to push its contrary view on California.

As the chief advocate for TURN on electric issues before the California Public Utilities Commission (CPUC), Bob Finkelstein has helped save consumers hundreds of millions of dollars. Finkelstein, who joined TURN's legal team in March 1992, also oversees the legal work of TURN's staff attorneys.