California wants delay on rate-hike decision

In this story: Short-circuit in Sacramento 'Cut through the red tape' RELATED STORIES, SITES

LOS ANGELES, California (CNN) -- California's attorney general has asked a federal judge to deny or defer a decision on a rate-hike request by one of the state's major utilities.

And a request by the state to speed up environmental reviews for new power plants has triggered a disagreement with the White House whether California wants environmental restrictions rolled back.

In federal court, Southern California Edison has asked a judge to force the California Public Utilities Commission to remove rate caps and allow rate increases. The utility believes the PUC has failed to act to ease its financial strain. SCE and the state's other large utility, Pacific Gas and Electric, are facing bankruptcy. PG&E has filed a similar request to raise rates, which will be heard at a later date.

ALSO    VIDEO With companies in California suffering, CNN's Rusty Dornin shows states with abundant power trying to woo away business Play video (QuickTime, Real or Windows Media)     IN-DEPTH SPECIAL Online coverage of the energy crunch in California  RESOURCES Status of state power deregulation     ALSO Calpine signs $4.6B deal   MESSAGE BOARD Power crisis

Judge Ronald S. W. Lew will hear SCE's case Monday at 9 a.m. But state Attorney General Bill Lockyear's request, filed Thursday, said the state government should be allowed more time to resolve the power crisis.

Lockyear sought to have "the people" of California heard, and suggested the judge "take no action in the near term that would change the status quo, in order to give the Governor and the Legislature sufficient time to address the various facets of the energy situation."

The attorney general's request also contends that many of the issues raised by SCE in its case have already been addressed by the state's efforts.

Lockyear's move comes as California continues to find a solution to its energy crisis, blamed on a deregulation quagmire that has left the state in its fourth straight week of Stage 3 power alerts. A Stage 3 alert occurs when energy reserves fall below 1.5 percent, and could result in rolling blackouts.

A federal judge extended a restraining order against three out-of-state power generators Thursday, ordering them to continue selling power to California until a hearing February 16.

And last week, California's Assembly passed a $10 billion measure effectively putting the state in the power-buying business. It allows the state to negotiate long-term contracts and enter into agreements with power producers. The state will then sell the power to PG&E and SCE.

Short-circuit in Sacramento

In Washington, what Gov. Gray Davis' asked President Bush to do in helping the state get new power plants on line caused a short-circuit back in Sacramento.

Since state permits often are affected by federal decisions on water and air pollution and endangered species protection, Davis asked the president for "assistance to expedite permitting by all appropriate federal agencies" along the same time schedule being adopted by state agencies.

Asked about the letter, White House press secretary Ari Fleischer said it was being reviewed by the special energy task force, headed by Vice President Dick Cheney.

"Is the state asking to waive environmental laws?" Fleischer was asked.

He said the administration views the letter "as a request to lift or relax environmental protection" in order to maximize power production in California, which for weeks has been under threat of rolling blackouts.

Fleischer described the request as involving not only the issuance of permits for new power plant construction but also the permission to ease environmental rules on existing plants and for "relaxation" of current restrictions on plants using pollution permits.

'Cut through the red tape'

"The governor made no such request," said Roger Salazar, Davis' spokesman in Sacramento. "The only thing the governor requested is that the federal government direct a number of agencies to expedite the permit review process and essentially cut through the red tape" for new power plants.

Salazar made available Winston Hickox, head of the California Environmental Protection Agency, who reiterated that Bush is not being asked to ease any federal environmental rules.

"We have not waived any air quality standards to accommodate the need for maximum power production" and have no plans to do so, insisted Hickox. He said state regulators have "run every ounce of flexibility out of the system" to give power plants ways to produce maximum power and still meet air-quality requirements.

Hickox was named by Davis as a power plant siting overseer who will direct the state effort to get an additional 5,000 megawatts of electricity capacity into operation by summer. The request to Bush was not aimed at environmental changes that apply to existing power plants, he said.

In a series of orders issued Thursday, Davis directed state agencies to take no longer than 21 days to consider and act on permits involving power plant construction.

The governor asked that federal agencies, including the Environmental Protection Agency, which handles air and water pollution matters, and the U.S. Fish and Wildlife Service and National Marine Fisheries Service, which have jurisdiction over endangered species, be required to also make their reviews in the same timeframe.

The governor was not asking for a relaxation of the regulations but only expedited action on the regulations, said Salazar, and only as the rules apply to construction of new power plants.

The governor's plan calls for getting three large, base-load power plants, being built by Calpine Corp., of San Jose, California, completed by this summer. They are expected to add about 1,200 megawatts of power.

Another 2,200 to 2,500 megawatts of capacity is hoped to be made available from smaller plants either near completion or at various stages of development, said Hickox.

Western governors, Bush team hold electricity summit
February 2, 2001
California governor signs bill to buy power for utilities
February 1, 2001
Utility bailout falters in California assembly
January 31, 2001
Stage 3 power alert continues in California
January 30, 2001
White House forms energy task force, but offers California scant hope of aid
January 29, 2001

The State of Tennessee Department of Economic and Community Development
Tulare County Economic Development Corp.
Reliant Energy
The California ISO
PG&E Corporation
SoCal Edison
  • Deregulation - What this means to you - Electricity Market Issues
California Power Exchange
System Conditions - The California ISO
California Public Utilities Commission
California Utilities Emergency Association
Foundation For Taxpayer & Consumer Rights

Note: Pages will open in a new browser window

External sites are not endorsed by CNN Interactive.