John Burton, senate pro tem president, said that California’s current energy crisis demonstrated the need for public ownership of the 26 000 mile network. “It gives us some control over our electrical destiny, it allows us to make badly needed upgrades in the system and it gives cash to utilities in exchange for assets that are of real value” he said, introducing the bill.
Burton’s is the most recent in a number of proposals aimed at repairing the damage caused by the disastrous 1996 move to partially deregulate the power market, leading to wholesale prices spiralling out of control, rolling blackouts and bottlenecks statewide and near-bankrupt utilities.
On Tuesday 6 February with the plug about to be pulled on electricity supplies that were only continuing by Federal order, US District Judge Frank Damrell issued a restraining order requiring Reliant Energy Services to continue selling electricity to the state’s ISO (independent system operator) at least until the following day when a new court hearing would take place. Three other suppliers agreed ahead of the court hearing to continue selling, even though California’s two biggest utilities are nearly bankrupt and cannot afford to buy supplies.
With the crisis now nearly a month old, the two major utilities racking up billions of dollars in debt over high spot prices, and Federal supply continuity orders expiring soon, the prospect of statewide rotating blackouts is becoming daily more likely. Currently power reserves remain very low at only 1.5 per cent of peak demand about one tenth of the reserve cushion usually required.
