New group against deregulation promotes renewables
1 August 1998
Californians will vote on an initiative in November to dismantle key parts of the state's ground breaking electricity deregulation. Backed by 100 consumer groups under the umbrella organisation Ratepayers for Affordable Green Energy (RAGE), the initiative would give residential customers a 20% rate reduction for supplies of renewable energy instead of the 10% mandated under the current policy. Its backers -- who include famed consumer advocate Ralph Nader and environmentalist David Brower, who founded Friends of the Earth -- argue that most of the benefits of deregulation have gone to big businesses. "Powerful economic and political interests are clashing at both the state and national levels in an effort to profit," Nader says. "If we let these vested interests succeed, we will be left with a few energy companies who control our energy future." If passed by popular vote, the measure will also undo the provision to make consumers pay for the $28 billion in "stranded assets" on behalf of the state's three large utilities which are owned by investors. Supporters of the initiative, dubbed Californians against Utility Taxes (CUT), fear too few consumers will buy green electricity unless they receive more benefits from deregulation. The outcome of the California vote will be crucial, especially since power struggles are also heating up in other parts of the country, namely Massachusetts and Pennsylvania. Since April's deregulation, the California residential market has been unexpectedly flat, and a number of providers of renewable energy have opted out. Still, some environmental groups oppose the CUT initiative. The Natural Resources Defense Council (NRDC) and the Environmental Defense Fund argue that the current deregulation law does promote renewables. "We think the initiative is trying to fix something that isn't broken, and we believe it would invite paralysis in an industry that desperately needs to change," says Ralph Cavanagh of the NRDC.
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