Document:California Press Release 7 February 2001 Power Line Plan Just Another Pernicious Proposal

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14547 Titus Street, Suite 214
Panorama City, CA 91402
For immediate release: February 7, 2001
For additional information:
Juan Ros, Executive Director
Phone: (818) 782-8400

Power Line Purchase Plan Just Another Pernicious Proposal by Politicians

PANORAMA CITY -- A bill introduced yesterday by State Senator John Burton would authorize California to purchase 26,000 miles of private electricity transmission lines -- a proposal state Libertarians are calling preposterous, predictable, and a perilous step towards more government regulation, the Libertarian Party of California announced today.

"First our elected lawmakers passed a botched law in 1996 that was sold as deregulation but actually increased regulation. Then the state became purchasers of power to the tune of $45 million tax dollars per day, not to mention the $10-$20 billion in bonds that will be sold. Then Governor Gray Davis decides to send out power police to fine violators who don't dim their lights. Now they want to buy 26,000 miles of electrical wires," stated Libertarian executive director Juan Ros.

"When will they ever learn?"

Burton's bill, SB 33X, estimates the cost of the transmission grid at nearly $4 billion. The private utilities that own the grid would use the funds from the sale to pay down the massive debt accumulated recently as a result of government price controls on how much utilities can charge electricity consumers.

"Taxpayers will have to foot the bill for maintenance, repair, and expansion of the grid, at an unknown cost," Ros pointed out. "Consumers will pay more for electricity since the cost of the bonds used to pay for the purchase of the grid will be passed on to the ratepayers. And, as with all other government-owned property, the grid will likely suffer from deterioration, neglect, and misuse."

Ros added, "Burton's proposal is just another bad idea. So far not a single Republican or Democrat in Sacramento has offered a solution to the electricity problem that will work."

To Libertarians' surprise, one prominent Democrat is sounding more like a Libertarian after recent public comments: U.S. Senator Dianne Feinstein.

In a speech yesterday, Feinstein criticized California's restructured electricity market and called for the elimination of government-imposed price controls, noting, "If you deregulate the retail market, you send a clear price signal to consumers and provide them strong incentives toward cutting their energy use -- preventing blackouts and lowering prices."

Concluded Ros, "We welcome Senator Feinstein's surprisingly sound comments, but we doubt Governor Davis or the Legislature will listen. Libertarians urge lawmakers to reject SB 33X and leave the transmission grid in the proper hands of private proprietors."