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Newport-Mesa feels energy crisis crunch

January 10, 2001

Paul Clinton

NEWPORT-MESA -- As residents and businesses brace for the fallout from

a bungled attempt to deregulate the state's power industry, officials in

Costa Mesa and Newport Beach are working to soften the blow.

In the coming weeks, electricity users in the two cities will feel the

effect of the rate hikes approved earlier in the month by the state's

Public Utilities Commission. The increases -- ranging from 9% for

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residents to 15% for large businesses -- are expected to go hand in hand

with rolling blackouts in the spring.

Newport Beach and Costa Mesa don't own their own power plants.

Instead, power is supplied by the Southern California Edison Co. The

utility, swamped in debt after buying power from out-of-state producers,

is on the verge of bankruptcy.

Costa Mesa City Manager Allan Roeder, whose wife works for Edison, has

seen the issue from both sides of the fence. Tuesday, a day after Gov.

Gray Davis proposed measures to resolve the brewing crisis, Roeder said

he still needed questions answered.

"I'd be more positive if there were more specifics," Roeder said about

Davis' speech. "What I didn't hear from the governor is what steps we are

going to take to avoid rolling blackouts."

Without any self-sustaining plants or long-term contracts to import

power from outside municipal boundaries, both cities are expected to feel

the crunch.

Costa Mesa spends $1 million per year to light city streets, a figure

Roeder said would jump 18% this year. Overall, Costa Mesa spends $1.5

million on power.

In Newport Beach, department heads were asked by City Manager Homer

Bludau in a Sunday e-mail message to slash 10% from their utility budgets

to offset the rate increases.

"We can anticipate that our costs will go up 10%," Bludau said. "We're

not looking at adding any [additional funds] to the utility budgets."

While local cities grapple with the power shortages, state and

national lawmakers are also preparing to tackle the issue.

State Senator Ross Johnson (R-Newport Beach), who joined other

Sacramento legislators in unanimously approving the now-notorious 1996

deregulation bill, also said Davis hasn't adequately spelled out a

solution.

"The governor isn't providing the decisive leadership needed to deal

with California's energy crisis," Johnson said in a prepared statement.

"His comments were general and didn't provide anything really new. One

crucial question he failed to address is who is going to foot the bill

for the multibillion debts incurred by utility companies."

Federal lawmakers have also vowed to take up the issue. Rep. Chris Cox

(R-Newport Beach) was out of the country during Tuesday's White House

energy summit but said he would address the issue in committee at a round

of upcoming hearings.

"The electricity crisis in California and the role of [the Federal

Energy Regulatory Commission] will be a major focus of the energy and

commerce committee in the 107th Congress," Cox said in a prepared

statement.

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