NEWS: no regulation demands from PG&E ,
 *  yesterday's San Diego Union Tribune




PG&E sent hard-nosed proposal to Davis demanding no regulation=20





ASSOCIATED PRESS=20
April 16, 2001=20
SAN FRANCISCO =01) Pacific Gas and Electric Co. officials demanded the util=
ity=20
be cut free from state regulation and be allowed to push huge rate increase=
s=20
onto its customers, two weeks before negotiations with Gov. Gray Davis brok=
e=20
off, the San Francisco Chronicle reported.=20

"Perhaps we misjudged their primary concern," said Steve Maviglio, the=20
governor's spokesman. "It wasn't resolving their credit issue. It was=20
extracting vengeance on the PUC."=20

In addition to insisting that it be released from the state Public Utilitie=
s=20
Commission's regulatory grip, PG&E demanded it be allowed to buy back its=
=20
power lines without competitive offers if the state ever decided to sell. I=
n=20
addition, it wanted to continue profiting from any telecommunications lines=
=20
or antennas linked to the system, according to a Feb. 28 eight-page proposa=
l=20
obtained by the Chronicle and published Sunday.=20
n Developments in California's energy crisis=20

PG&E denies the document influenced the outcome between the utility and the=
=20
state.=20
"It is ludicrous to suggest that this document caused the negotiations to=
=20
break down," said PG&E spokesman Ron Low. "There were negotiations that=20
occurred later and other documents that followed."=20
At the time of the utility's bankruptcy filing April 6, PG&E Corp. Chairman=
=20
Robert Glynn said no talks had been held for three weeks. PG&E's proposal h=
ad=20
been delivered about two weeks before talks ceased.=20
PG&E has said it's entitled to recoup $9 billion it paid for wholesale powe=
r=20
because of PUC-regulated rate caps, which kept the utility from passing hig=
h=20
costs onto customers.=20
The proposal said this money "will be fully recovered in retail rates witho=
ut=20
further CPUC review for prudence or any other purpose," the Chronicle=20
reported.=20
The document went on to demand the PUC drop all proceedings concerning PG&E=
,=20
including an investigation into whether the utility violated California law=
=20
by transferring millions to parent company PG&E Corp. prior to filing=20
bankruptcy.=20
"They took a position on regulatory matters that was out of touch with=20
reality," Maviglio said.=20
PG&E Corp. spokesman Shawn Cooper declined to comment on the proposal.=20
"That document is confidential," he said.=20
Ratepayer advocates say they're baffled by PG&E's demands.=20
"It's like the Japanese insisting that we surrender Hawaii after we beat th=
em=20
in World War II," said Harvey Rosenfield, consumer advocate for the=20
Foundation for Taxpayer and Consumer Rights.=20




, Copyright 2001 Union-Tribune Publishing Co.
ca.team@enron.com