[Congressional Record (Bound Edition), Volume 146 (2000), Part 12]
[House]
[Page 17163]
[From the U.S. Government Publishing Office, www.gpo.gov]



      A DISASTER FOR SAN DIEGO: DEREGULATION OF ELECTRIC UTILITIES

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from California (Mr. Filner) is recognized for 5 minutes.
  Mr. FILNER. Mr. Speaker, I rise tonight to tell my colleagues about a 
tragic situation going on in San Diego, California. Like all of my 
colleagues, I went home at the beginning of August for a work period in 
our district, but what I found in San Diego was a disaster, and not a 
natural disaster but a man-made disaster, a disaster made by a few 
companies who are willing to put the whole quality of life of San 
Diegoans at risk for their own profit; a disaster that did not affect 
only a few people, but affected all of the residents of San Diego 
County, 2\1/2\ million people.

                              {time}  1930

  What was the basis of this disaster? San Diego is the first area in 
California to fully deregulate the electrical utility industry, to 
fully deregulate, which means that San Diegans pay the market price for 
electricity. The market price is determined by the few generators of 
electricity who control the power grid into San Diego.
  So what was the result of this deregulation, a deregulation which was 
supposed to bring competition and lower the cost? It doubled and then 
tripled the cost of electricity in just 3 months. In just 3 months, if 
they were a resident in San Diego County, their bill went up from $45 
to $50 to $100 one month and $150 the next month. If they were a small 
business struggling to get by, their $800 bill went up to $1,500 in one 
month and then went up to $2,500 the next month.
  How could they stay in business with those increases in prices?
  Hospitals, libraries, youth centers, schools, the military, all of 
their budgets thrown into turmoil. And what was the reaction of people? 
Rebellion. Many people just tore up their bills.
  Elected bodies in San Diego County said they are not going to pay the 
doubled or tripled price, they are going to pay only what they paid the 
year before, because they knew their costs were not determined by a 
supply-and-demand function but by price gouging and manipulation of the 
market.
  Rallies were held. Demonstrations took place. Political figures at 
the city, county, State level tried to begin to solve this problem. The 
State legislature acted earlier this week by putting a cap on the 
retail price of electricity, a cap on the retail price. But what the 
State legislature did was merely put a Band-Aid on a bleeding city. 
Because that price was just deferred to a later time. It was not 
refunded. It was deferred. And the people who would have to pay that 
price were not the folks who gouged San Diegans to begin with, but the 
actual consumers who were the victims of this price gouging.
  We must go beyond what the State of California's legislature did. The 
Federal Government must act and can act. The wholesale price of 
electricity can be set by the Federal Energy Regulatory Commission. And 
this Congress should direct that commission, known as FERC, to in fact 
roll back the wholesale price of electricity to the price that was paid 
before deregulation in which people had made profits and good profits 
at that price; and yet they were charging and are now charging prices 
double, triple, quadruple, five times what they were before 
deregulation.
  I have a bill, my colleagues, called the Help San Diego Act: Halt 
Electricity Price Gouging in San Diego and Halt it Now.
  The people in San Diego cannot survive the doubled and tripled prices 
of electricity rates. Small businesses are going under. Seniors are 
having to make choices between using their air conditioning or paying 
for their food or medical prescriptions.
  I ask my colleagues to look closely at San Diego, a little dot on the 
southwest corner of our Nation, because we are the poster children for 
the future. The rest of the State of California will soon be 
deregulated. Many of my colleagues in their States have deregulation 
bills in their legislatures. This House has deregulation bills in front 
of it. This deregulation cannot work, my colleagues, when a basic 
commodity is controlled by a few monopoly corporations.
  The San Diego example makes it clear the consumer must be protected 
if this kind of policy is going to be pursued.
  Deregulation in California took place without consumer protection. It 
took place in an atmosphere of monopoly control of a basic commodity. 
My city was in danger of dying economically. We have stopped it 
temporarily with State legislative action. But the Federal Government 
must act now. FERC must roll back the wholesale price of electricity 
retroactively.
  The people, the companies, who forced these unconscionable rates on 
the citizens of San Diego should pay the price and not the consumers, 
the victims themselves.
  My colleagues, look closely at San Diego. Your city may be next.

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