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Commission Watch

California anticipates changes in energy policy under its new governor.
Fortnightly Magazine - March 2004

"provides an opportunity to assure a reliable supply of natural gas," and "will create more natural gas capacity." 16 Initiatives in this area would promote the goal of diversifying sources of natural gas, and help the state avoid any bottlenecks that develop in the gas transportation system.

The Schwarzenegger administration's detailed implementation plan is expected by the spring of 2004. None of these new initiatives are expected to represent a radical shift in policies. However, Schwarzenegger is committed to restoring confidence in government and improving the business climate, and at the same time taking steps to increase and diversify California's energy supply and improve the environment. Therefore, there is reason to be optimistic about California's energy future. At the same time, the flood of energy litigation is likely to subside so that perhaps in a year's time, all will once again be quiet on the Western front.


  1. Professor Sweeney's book, (Hoover Institution Press Publication, 2002), is one of the most comprehensive and digestible explanations of the events that led up to, and exacerbated, the California energy crisis.
  2. Other members of the working group include Ralph Cavanagh, senior attorney, NRDC; Severin Borenstein, director, University of California Energy Institute; Joe Desmond, president, Infotillity; Dan Emmett, an architect from Southern California who has focused on green buildings; Lenny Mendonca, managing director, McKinsey & Co.; Glenn Thomas, former chairman of the Pennsylvania Public Utilities Commission; and Dan Skopec, the liaison to the Schwarzenegger transition team.
  3. Rep. Ose and Skopec were actively connected to various Congressional hearings and proceedings involving the California energy crisis, including: "Assessing the CA Energy Crisis: How Did We Get To This Point, and Where Do We Go From Here?" 107th Cong. (2001); "FERC: Regulators in Deregulated Electricity Markets," 107th Cong. (2001); and "Energy: Maximizing Resources, Meeting Needs, Retaining Jobs," 107th Cong. (2002). Ose sponsored legislation aimed at increasing FERC's investigative and remedial powers over the energy industry.
  4. See Policy Statement at p. 9.
  5. See .
  6. See Article 6, "Qualified Departing Load CRS Exemptions," Section 1395, California Energy Commission (Dec. 31, 2003).
  7. Policy Statement at p. 9.
  8. See Policy Statement at pp. 9-10.
  9. , 267 F.3d 1042 (9th Cir. 2001).
  10. See
  11. (Dec. 18, 2003).
  12. See Policy Statement at p. 10.
  13. See Policy Statement at p. 13.
  14. See Policy Statement at p. 10.

Real-Time Price Study Update: Closing the Loop

The California Energy Commission recently released results of the Statewide Pricing Program (SPP) analysis performed by Charles River Associates (CRA). CRA found the program successfully caused significant peak-demand reductions.

The program included both time-of-use (TOU) and critical peak prices (CPP); TOU consisted of peak and off-peak rates, while CPP included peak, off-peak, and "super peak" rates that were dispatched 12 days during summer 2003. CRA's draft results are shown in the table below (final data may differ). CRA found California's customers had price elasticities, peak demand reductions, and peak usage reductions consistent with customers in other programs around the country. The SPP sample population is generally representative of the statewide population. However, the "CPP with automated response" group volunteered to be