Governor's Seal
OFFICE OF THE GOVERNOR


PR00:193

FOR IMMEDIATE RELEASE
August 2, 2000

 

CONTACT: Michael Bustamante
916/445-4571

GOVERNOR DAVIS ACTS TO STABILIZE ELECTRICITY PRICES, REDUCE DEMAND

Issues Executive Orders Designed to Increase Generating Capacity and Conservation Efforts; PUC/EOB Issues Action Plan to Governor

SACRAMENTO – In a continuing effort to stabilize prices in California’s newly- deregulated electricity market, Governor Gray Davis today issued three Executive Orders designed to reduce energy consumption by state government and speed up the time it takes new power generating facilities to win approval from state agencies.

In addition, Governor Davis formally requested the California Attorney General to investigate "possible manipulation in the wholesale electricity marketplace." The governor also released a report prepared by the President of the Public Utilities Commission (PUC) and the Chairman of the Electricity Oversight Board (EOB) that he requested that recommends action steps to avert price spikes and blackouts.

"The challenge of providing electricity supplies to California families and businesses has become increasingly complex under deregulation, demanding unprecedented action to address an unacceptable situation," said Governor Davis. "The report I requested from the President of the PUC and the Chairman of the EOB provides many options in addressing electricity emergencies and pricing issues in both the short- and long-term.

"We also need to take immediate actions that address both the supply and demand, and the state should lead by example," the governor continued. "The actions I ordered today are designed to spur additional measures in the private sector to help Californians gain more control over their energy future."

Increased demand for electricity and lack of new energy generation facilities during the past decade have been partially blamed for high electricity prices in parts of California, noted Governor Davis. His first Executive Order directs all California agencies involved in building new energy facilities to streamline the review process for siting new power plants without compromising environmental laws or public health and safety protections.

Under the Order, all state agencies involved in permitting new facilities must submit their review and findings within 100 days of receiving a completed application. Currently there is no deadline for review of energy facility applications by state agencies. In some cases, agencies have taken as long as a year to submit their reports.

"Electricity prices in a deregulated market are largely the function of supply and demand, and California agencies should work faster to increase supply," said Governor Davis. "This Executive Order will ensure that bureaucracy is not the cause of delay and that state agencies are doing everything they can to ease prices now and in the future."

No major power plant has been constructed in California in the last 10 years. The California Energy Commission approved five applications last year, with four facilities under construction that will generate a total of approximately 3,500 megawatts. The governor’s Executive Order also directs the Commission to propose legislation and/or regulations to prioritize and expedite applications for projects with the least environmental health impact.

In addition, it creates a California Energy Reliability Task Force, modeled on the federal government’s National Security Council, to coordinate the action of the state’s energy-related agencies.

Governor Davis also directed state agencies to take immediate emergency actions to reduce energy use during Stage Two and Stage Three alerts. These measures include reducing hot water temperatures to 105 degrees F. in state buildings, reducing overhead lighting by 50 percent, and shutting down computer systems and other electrical appliances (such as photocopiers) during non-work periods.

The governor’s second Executive Order directs state agencies to improve the energy efficiency in all state buildings. It directs the Secretary for State and Consumer Services Agency to include sustainable building practices into plans for all new state building projects. They include measures to improve the energy efficiency of lighting, windows, and heating and cooling systems.

The 40-page PUC/EOB report, requested by Governor Davis in June after blackouts and brownouts in the Bay Area, includes 30 additional recommendations for addressing price increases and electricity supply problems. It also recommends several actions already taken by Governor Davis last week and today. They include calling on the Federal Energy Regulatory Commission (FERC) to extend wholesale price caps and recognizing that "no competitive market exists" for electricity in California.

# # #


GOVERNOR GRAY DAVIS   -   SACRAMENTO, CALIFORNIA 95814    -     (916) 445-2841