Return to News Exchange Index California Dereg Bill Earmarked $500 million for Pacific Gas &Electric

Despite a regulatory judge's previous rejection of Pacific Gas & Electric's (PG&E) request for ratepayers to pay $240 million for its distribution system's safety and reliability, the state legislature's recent deregulation bill (AB 1890) requires PG&E's customers to pay the company $500 million for that purpose.

Section 368(e) provides for annual increases in PG&E's base revenues for 1997 and 98 for "enhancing distribution system safety and reliability." The revenue impact of the provision is estimated at $164 million in 1997 and $330 million in 1998.

The $500 million for PG&E over two years contrasts with a total of $872 million set aside in AB 1890 for energy conservation programs and only $465 million set aside for renewable energy technologies among all the state's utilities over the next five years.

A San Jose Mercury News article said PG&E had used "the worst blackout in recent memory to engineer a legislative coup," and said the new law will "permit the utility to bill ratepayers a second time for repairs they already funded," based on PG&E records that indicate ratepayers have paid the company $231 million since 1990 for work never performed.