California, as the nation’s early poster child for energyindustry restructuring, has to bite the bullet and decide if itwants robust retail competition for natural gas and electricity, orwhether it wants to stop where it is now with wholesalecompetition, “declare victory and everyone go home,” said thestate’s top energy regulator, Richard Bilas, an economist andpresident of the California Public Utilities Commission. If itwants retail competition, then the state should consider adoptingsome of the aspects of Georgia’s gas restructuring andPennsylvania’s electricity changes.

Cautioning that he is unsure how his four fellow CPUCcommissioners feel about it, Bilas noted that he is not outrightendorsing Pennsylvania’s retail “shopping credit,” or Georgia’sbanning of the investor-owned utilities from the retail merchantfunction in gas, but he wants them seriously considered as a meansof lowering barriers to competition.

Former federal energy department official, Ken Malloy, who nowheads a new Washington, DC-based think tank promoting retail energycompetition, has convinced Bilas that true competition requiresretail-level participation.

“Ken has me convinced that these approaches are a way tostimulate retail competition-not that I necessarily agree with whatPennsylvania is doing or what Georgia has done on the gas side,”said Bilas, during a 45-minute telephone interview Oct. 1. “So Ihave put this out to the commissioners and the staff to see ifthese techniques could be beneficial in the near-term to bringabout some degree of retail competition in California.”

“The question that has to be answered is: has Californiaminimized the barriers to entry,” Bilas said. “If it has not, thenCalifornia needs to look at ways to cut the barriers to entry evenmore than we think we have, or looking at some other technique(like Georgia’s approach). So I am willing to reconsider thepossibility of using the Georgia scheme.”

Bilas says the overriding question that is still unanswered byCalifornia’s political leaders is whether the state is “committedto energy retail competition.”

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