DAVIS ANNOUNCES PLAN TO RESCUE TROUBLED UTILITIES By Jennifer Coleman Associated Press February 18, 2001 SACRAMENTO, Calif. -- Proposing to plunge California deeper into the energy business, Gov. Gray Davis announced a multibillion-dollar plan to rescue two utilities from the brink of bankruptcy in part by buying miles of electric transmission lines. The plan also would require the parents of Southern California Edison and Pacific Gas and Electric Co. to help pay off the utilities' debts, which they say are approaching $13 billion. Under the plan announced Friday, the state would spend billions for power lines owned by PG&E, SoCal Edison and the state's other investor-owned utility, San Diego Gas & Electric. Buying the lines could cost the state $7 billion, Democratic Assemblyman Fred Keely said. Enough of the Legislature's majority Democrats appear to support the proposal to pass it. Davis said it would be financed with no rate increases. The state has pledged to spend at least $10 billion in revenue bonds to buy power for customers of SoCal Edison and PG&E, both of which have been denied credit by electricity suppliers. The state has committed close to $2 billion since early January to buy electricity to keep the lights on for customers of the two cash-strapped utilities. A law signed by Davis last month allows the state to enter into lower-cost, power-buying agreements lasting several months to a decade. Until then, the state is spending about $45 million a day. Critics said customers will end up paying for the latest plan. Republican Assemblyman John Campbell said the governor's overall plan has grown to more than $20 billion, spread out over state-issued revenue bonds that will be paid back by customers.
