CA Governor Signs Two Electricity Bills

Separate but closely linked California legislative proposals to provide consumer electricity rate relief and accelerated power plant siting/energy efficiency programs were signed into law Wednesday by Gov. Gray Davis, who used the occasion to list 11 separate previous electricity-related actions he or his administration have taken since June 14 immediately following the first controlled rolling brownouts in the San Francisco Bay Area since World War II.

The governor did not act on a third electricity bill addressing utility company revenue shortfalls from the rate capping measure, and a spokesperson in his press office said he has until Sept. 30 to make up his mind whether to sign or veto the measure, or let it die by inaction. The still undecided measure would use $150 million in taxpayer dollars to help make San Diego Gas and Electric whole.

As a result of his most recent actions, a new law (AB 265) reduces residential electricity in San Diego to an average of $68 monthly, and to $220 for small businesses, with a retail price cap of 6.5 cents/kwh.

The second measure (AB 970) establishes a six-month, expedited siting process for new power plants in an effort to address California's growing shortage of adequate power supplies during heat wave-induced peak-demand periods.

Davis called the two new laws "one of the major achievements" of the just-concluded state legislative session, adding that although his administration "did not create this problem, it is 100% committed to solving it."

The legislation was set up as "urgency measures," becoming effective with the governor's signature, and he used that fact to stress that the rate relief for San Diegans is "finally on the way," although regulator-directed relief in the form of refund checks actually began arriving in early August, averaging $290 for each residential customer and $760 for small businesses.

Davis' formal announcement noted that the need for new power plants is one of the major steps California must take to begin cutting the run-up in wholesale electricity prices that have stayed almost double what they averaged a year earlier --- even in non-peak demand periods.

"Restriction and red tape have presented a powerful disincentive to those who would build more power generators in California," the governor said. "This (new law) will benefit consumers by increasing supply to meet growing demand. It will also establish new programs to reduce demand."

As part of the siting law, an extra $50 million of state funds will be allocated to demand-side management programs to help reduce peak electricity demand levels.

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