The Willow Glen Resident

Willow Glen residents plan for deregulation

Residents will soon have a choice of electric companies

By Cecily Barnes

Each month, all Northern California residents, including those in Willow Glen, stick a check into Pacific Gas & Electric's orange and yellow envelope in exchange for a heated stovetop, lighted bathroom and blustering heat vent. Throughout the county, renters and homeowners do this without a second thought. Very soon, however, this will all change.

Come the first of the year, California will become the first state in the nation to allow consumers a choice of electric companies--the idea being that competition will drive the prices down. The Assembly bill further mandates that all residential and small-business customers get an automatic 10 percent discount, funded by utility bonds.

"The big rallying cry is that California's electric rates are the highest in the nation," said Randy Chinn, consultant to the Senate's energy, utilities and communications committee. "The number that was thrown around was that California's rates were 50 percent higher than the national average."

Some consumer advocacy groups, however, fear that once electric companies escape from the regulatory arms of the government, they will jack their prices up instead of down.

"What's to prevent them from saying, 'Now that this is deregulated, we could document all these costs we incur, and why we need to raise our rates another 50 percent'?" said Lee White, regional director of the American Association of Retired Persons. "We think some principles would be violated if they're not regulated."

But when electric deregulation was approved on Capitol Hill, it was done on the condition that an education program be launched to inform consumers about their rights. Making good on that promise, the California Public Utilities Commission has launched a multimillion-dollar education campaign called "Plug In, California."

" 'Plug in, California' is happening so that we can get the facts out at the same time that energy companies are doing their advertising," said Evelyn Jerome, account executive for Rogers & Associates, which is handling the "Plug In, California" account. "Electricity is a $20 billion per year industry. When the legislation was passed, one of the parts was that there needed to be a consumer-education program so that people understood what was happening."

Among other efforts, the CPUC has already set up a live-operator call center to answer consumer questions and will dole out $10 million to various community-based organizations committed to spreading consumer information. The outreach will target families, small businesses, ethnic communities and hard-to-reach and special-needs populations such as seniors, rural populations and non-English-speaking individuals.

Companies that want to sell energy to California consumers must also register with the CPUC so that it can protect customers from unscrupulous companies. With mandatory registration, consumers can call and request information about various energy providers.

"The CPUC is not going to allow customers to buy from companies that are fly-by-night," Jerome said. "The point of the legislation was to bring down the price of the energy for consumers."

Likely, California's energy industry will soon mimic the long-distance phone market, with three or four large companies and dozens of smaller ones to choose from.

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