"In the last Electricity Report of two years ago, the Energy Commission argued that only by unleashing the forces of competition would the state's electrical consumers enjoy the greatest value for the lowest possible price," said Commission Vice Chairman David A. Rohy, presiding member of the Electricity Report Committee. "We encouraged efforts to transform monopoly electricity generation into a free market, and that day is almost upon us."
The report looks at a deregulated electricity system beyond its January 1, 1998 start-up date and discusses how a free market will achieve the fundamental goals expressed by the Energy Commission two years earlier: to ensure that such a system is as economically efficient as possible, and that the state's public policies are achieved.
While delineating the extent to which a deregulated system realizes those goals, the report offers suggestions for improvements when needed. It goes on to make a thorough examination of consumer choices for retail electricity services, the effects of deregulation on the economy, environment and reliability of electricity. It explains why the state encourages energy efficiency, ensures continued research and development to benefit consumers, and advocates a diversity of fuel types to produce power.
The report also assesses supply and demand trends in electricity. It establishes criteria that the Energy Commission will use to determine whether new power plants are needed, granting that the economic incentives of a competitive market will be sufficient to cause enough new power plants to be built in the future.
In the light of electricity deregulation, government agencies like the Energy Commission, which frequently collect and disseminate reliable information will have an important role to play. The report said the Commission will expand its part in providing information needed to ensure that market participants, particularly small customers, can make well informed decisions.
And although deregulation does not affect publicly owned utilities (POUs), the report discusses the unique opportunities for these entities in a competitive market.
Copies of the report will be available in four to six weeks. To obtain a free copy, contact the Commission's Publications Unit at (916) 654-5200 and ask for publication P300-97-001. The Executive Summary of the report will be available on the Energy Commission's Website at: www.energy.ca.gov
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