It will allow the state's two largest utilities to increase prices, which currently are lower than their costs. Davis, who appointed three of the five members of the PUC and has boasted that he expects his appointees to reflect his wishes, says the rate increase was premature and that he did not know about it in advance. About 45 percent of the customers will not get an increase. Actually, everyone will pay more, because all businesses will have higher rates, which they will have to collect from their customers. Only politicians pretend to believe that businesses pay taxes.
Consumers know better.
Meanwhile, mismanagement of this situation is not just problem for California residents. Utilities in surrounding states such as Oregon, Washington and Utah are having to charge their customers higher rates because the federal government requires them to sell cheap power to California. It is not beyond possibility that California's kookiness could drag the entire economy into recession. Meanwhile, environmentalists who helped precipitate the crisis by opposing new power plants continue to talk about windmills and solar power. If ever a Florida politician suggests utility restructuring that even resembles the California fiasco, buy some candles quickly.