California PUC Approves 46% Rate Increase

SACRAMENTO, CA. -- -

SACRAMENTO, CA. -- (AP) Amid the jeers of protesters yelling "Hell, no, we won't pay!" California regulators have unanimously approved electricity rate increases of up to 46 per cent to head off blackouts this summer and keep the state's biggest utilities from going under.

The increases -- approved 5-0 by the Public Utilities Commission -- are the biggest in California history and take effect immediately for the 25 million people served by Pacific Gas and Electric Co. and Southern California Edison Co.

"The PUC has done all it can," commission president Loretta Lynch said. "We have fought back hard in every venue possible against these unjust energy prices."

Lynch had proposed the higher rates as a way to get "electricity hogs" to conserve power and stave off blackouts this summer, and as a way to help keep SoCal Edison and PG&E solvent.

SoCal Edison and PG&E say they have lost more than $13 billion US since last summer because of high wholesale electricity prices and because California's 1996 deregulation law prevents the utilities from passing those costs on to their customers.

Some ratepayers and consumer groups have branded the plan a rip-off.

The increase will be on top of the nine-per-cent to 15-per-cent hike the PUC approved in January, and an additional 10-per-cent increase already scheduled for next year.

"We are being held hostage by a handful of energy companies that, under deregulation, got control of our electricity supply," said Harvey Rosenfield, president of the Foundation for Taxpayer and Consumer Rights in Santa Monica. "Until our elected officials start acting to protect us, we are going to be at their mercy, at the mercy of this rip-off."

Spokespeople for both utilities said it is impossible to calculate how much Lynch's plan would cost customers because the effect of the tiered system is not yet clear.

"Our bills have gone from $26 to $70 for a stinking studio apartment and we don't have a heater, we use the oven to heat up the studio," said Belinda Lazzerini, 40, who works at Jitters & Shakes in San Francisco. "The laundromat has gone up from $1.50 to $3, so now we will have to clean our clothes by hand and dry them in the basement. It's crazy."