Gov. Gray Davis unveiled Friday. Davis wants the state to let the companies refinance part of their debts by selling bonds that would be repaid by consumers. He has also proposed buying the companies' high-voltage transmission lines as a way to infuse the firms with cash. But Johnson and other Republicans say it looks more like a sellout. They may have a point.
Nobody doubts that the utilities are in a cash crunch.
For much of last year, they were buying power at high wholesale prices while being forced to sell it at lower retail rates frozen by state law. This is not the road to profitability. About half that debt is owed to themselves and needn't even be an issue. But even those numbers don't tell the entire story. Before wholesale rates spiked last May, the retail rate freeze worked to the utilities' advantage.