March 27, 2001

California utility regulators are taking

California utility regulators are taking a progressive step by letting the two utilities awash in $13 billion of debt raise their electricity rates. While so-called consumer advocacy groups are saying it's a rip-off, the fact is Pacific Gas and Electric Co. and Southern California Edison Co. are losing a fortune by selling electricity below what it costs them to buy it on the wholesale market. Practically giving away electricity isn't exactly what I would call a "rip-off."

What the rate hike does is tell consumers that electricity is scarce and they must limit their use or pay higher electricity bills. Instead of crazy schemes by Gov. Gray Davis (D-CA) to have state government buy power production, the PUC is taking advantage of the Law of Demand.

"Calif. Regulators OK Rate Increases"