Deja Vu All Over Again.

At the urging of Chairman Michael Peevey, the PUC today will consider reopening Direct Access, the lynchpin of California’s much-maligned electricity deregulation experiment.

Now that things like “rolling blackouts” and “Enron” are fading memories, Peevey wants to get back to allowing consumers to bypass big utilities and get their power form merchant energy producers. Consumer advocates are-predictably—freaking out.

Peevey is taking the position that Direct Access is not an inherently bad thing and that the energy crisis was based more on the wrong execution of the right idea. Consumer choice, he argues, will foster marketplace competition and drive down the price of electricity.

Bob Finkelstein from TURN, points out that Peevey can’t do anything without the consent of the legislature, which suspended Direct Access in 2001. Additionally, there is the small matter of those bonds that financed the state’s assumption of electricity contracts during the crisis—they have to be paid off by utility ratepayers and if consumers abandon the big utilities in droves, who’s going to foot that bill?

Peevey acknowledges that his plan raises “a thicket of legal and financial questions”.

PUC chief reopens debate; Deregulation plan was abandoned by state in 2001 [San Francisco Chronicle]