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High electric bills persist in Calif.

By Associated Press / March 26, 2002



SAN FRANCISCO

Jenny Lovrin used to rip open the natural gas electricity bill each month and find that she and her five roommates owed less than $100. This winter's bills have hit $225.

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"Every month I'm afraid to open that bill and see how much higher it's gotten" says Ms. Lovrin, a receptionist. "With six people it's hard to tell everybody 'Turn off the lights, don't use the heater as much."'

The end of March marks the end of one year since rolling blackouts and utilities' debts prompted California power regulators to raise electric rates, partly to keep the utilities in business.

The emergency hikes mean customers of Pacific Gas & Electric Co. and Southern California Edison are paying among the nation's highest rates. The Public Utilities Commission later hiked rates for San Diego Gas & Electric consumers, too.

Coincidentally, the end of March also marks the end of a rate freeze that was imposed by the legislature's ill-fated 1996 plan to deregulate electricity markets. Utilities say that freeze plunged them into debt and ruined their credit ratings by preventing them from passing wholesale power price increases on to consumers.

Despite lower wholesale prices now, the end of the rate freeze won't bring relief any time soon to businesses and consumers like Lovrin. The state still needs to recoup the roughly $10 billion it has spent buying electricity for utilities.

"I think the most likely outcome is that rates will be at this level for a long time," says Severin Borenstein, director of the University of California's Energy Institute.

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