California regulatory panel divided on electricity discount in Sonoma County
San Jose Mercury News, Calif. --Oct. 29
Oct. 29--An unusual request backed by Gov. Arnold Schwarzenegger to let PG&E give an electricity discount to a Sonoma County business threatening to move its 700 jobs out of California left state regulators sharply divided and unable to decide Thursday.
"I hope we can structure the sort of rate relief that will assist Amy's
promptly, but the hallmark of regulation has been non-discrimination in
rates," Commissioner Geoffrey Brown said.
"If we open ourselves to special rates for special customers, we might
as well destroy the rule of law in California." The commission already was
considering a PG&E proposal to expand an existing economic development
program and grant five years of rate discounts to big companies that otherwise
could not afford to stay in California. But that process is expected to take a
year.
Amy's can't wait that long, said Chief Operating Officer Scott Reed.
It has outgrown its plant and has begun planning its expansion.
Other states with lower power prices are trying to lure the company, and it
needs to know now whether it can get a discount in California, he said.
"If we wait a year hoping we get it and we don't, we're in panic
mode," Reed said. "We can't put the business at risk."
Commissioners Michael Peevey and Susan Kennedy said keeping Amy's jobs in
California should be paramount.
"You have an immediate instance where you could lose those jobs in a
state that needs those jobs," Peevey said.
PG&E has had a program since 1990 offering temporary rate discounts to
lure big companies to certain "economic development zones." As an
existing California business, Amy's doesn't qualify, said Pacific Gas &
Electric spokesman John Nelson.
PG&E in June asked the commission to let it expand the program to large
businesses throughout its service area. The proposed discount would start at 25
percent and drop 5 percent each year after that. A state office would review
applicants to determine eligibility.
Schwarzenegger personally appealed to Amy's to stay. His administration asked
PG&E to seek advance approval of the proposed discount from the commission.
Amy's had agreed to put off a decision until November, and Reed said the company
can wait for a Dec. 2 vote.
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