The so-called deregulation scheme actually clamped tight government controls on everything except the wholesale price of electricity. The explanation for California's short-term problem is price controls. The long-term problem is lack of generating capacity. Dictators have resorted to the most draconian enforcement measures. All competent economists oppose price controls.
Price controls are simply evil-a form of robbery.
Producers are robbed of their compensation and ultimately their assets, and customers are robbed of the necessities of life. California Governor Gray Davis may claim to protect ratepayers, but the piper is being paid-by taxpayers and stockholders. Reliable electricity will flow normally to Californians if price controls are lifted. But to assure adequate supply at an affordable price, California needs 10,000 additional MW of generating capacity in the next few years. State regulations made it virtually impossible to construct a new facility.