Monday, July 18, 2005

Prop 80 revives energy regulation debate

The next time voters go to the ballot box in California, they will be asked to decide an ongoing debate over energy regulation.

Proposition 80, an initiative on the Nov. 8 special election ballot, would ban consumers who aren't already doing so from buying their electricity from independent power providers.

By limiting the state's retail market for electricity, which gives users such as homeowners, hospitals, factories and farms an alternative to buying power from regulated utilities, Proposition 80 would roll back an important feature of the state's 1996 electricity deregulation law.

It also would provide at least a partial answer to the question of "whether we're going to have a market-based system or a regulated system" of power production and consumption in California, said Peter Navarro, a business professor and energy expert at UC Irvine.

It's a question of great import in a state that's preparing for electricity shortages this summer. The officials who oversee the state's power grid are bracing this week for record electricity usage and the possibility of issuing the first Stage 1 power alert of the year.

Proposition 80 would do little to quickly solve the problem at the core of California's energy woes — getting enough power where it's needed, when it's needed. But backers, led by the Utility Reform Network, a San Francisco ratepayers' advocacy group known as TURN, say the initiative would bring stability to the state's power grid and encourage investors to provide the financing for new power plants, helping the state meet its future energy needs.