California PUC cancels action on direct access

The California Public Utilities Commission Tuesday deferred action for the second time on the controversial question of ending direct access by retail customers to alternate electricity suppliers. The Department of Water Resources, the Department of Finance, and the State Treasurer's office submitted a written request to the PUC to delay any action on ending 'direct access' to electricity until next month.


By the OGJ Online Staff

HOUSTON, July 3 -- The California Public Utilities Commission Tuesday deferred action for the second time on the controversial question of ending direct access by retail customers to alternate electricity suppliers.

The PUC canceled its regular business meeting Tuesday only hours before it was scheduled to take place. The Department of Water Resources, the Department of Finance, and the State Treasurer's office submitted a written request to the PUC to delay any action on ending "direct access" to electricity. The state agencies requested that the matter be taken up in midAugust.

The Association of California Water Agencies, a statewide organization representing public water agencies responsible for delivering 90% of the water in California, Tuesday urged the PUC to continue to allow direct access to alternative power supplies. The water agencies said they prefer to shop on their own for electricity rather than rely on the Department of Water Resources, which will have "carte blanche to do whatever it wants at whatever costs they alone deem reasonable," if retail access is ended.

The state is in the midst of working out a deal with near-bankrupt Southern California Edison Co. to buy its transmission system so the utility can pay its debt. It also plans to float a $13.4 billion bond issue to repay the general fund for electricity the state has already purchased and will continue to purchase on behalf of California.

Some observers say that the bonds cannot be issued unless "direct access" is ended because bondholders will insist on a steady predictable revenue stream to service the bonds. Allowing retail customers to choose providers other than California utilities would complicate the guaranteed revenue stream and therefore servicing for the bonds.

Sources said Republicans, who want direct access retained for large customers, are using it as a bargaining chip in negotiations to bail out Southern California Edison Co.

More in Home