muddyboots wrote:
...you'll remember the Enron Scandal that forced California to due rolling blackouts and drove up electricity prices to the point where old people were dying of heatstroke because they could no longer afford electricity for air conditioning?
How could they not afford it? The price was fixed!
Maybe you should blame this on your elected officials rather than Enron, who were merely opportunists (along with some others).
Actions of the California legislature were the root cause that allowed companies such as Enron to manipulate prices.
Quote:
Democratic State Senator Steve Peace, the chair of the energy committee and the author of the bill that caused deregulation, is often credited as "the father of deregulation". Wilson admitted publicly that defects in the deregulation system would need fixing by "the next governor".
Due to price controls, utility companies were paying more for electricity than they were allowed to charge customers, forcing the bankruptcy of Pacific Gas and Electric and the public bail out of Southern California Edison. This led to a shortage in energy and therefore, blackouts. Rolling blackouts began in June 2000 and recurred several times in the following 12 months.
Energy price regulation forced suppliers to ration their electricity supply rather than expand production. This scarcity created opportunities for market manipulation by energy speculators.
When the electricity demand in California rose, utilities had no financial incentive to expand production, as long term prices were capped.
The crisis, and the subsequent government intervention, have had political ramifications, and is regarded as one of the major contributing factors to the 2003 recall election of Governor Davis (D).
So part of the Democrats "deregulation" scheme was to allow energy price regulation, causing the utilities to go bankrupt. Niiiiice work!
