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California PUC Approves Rate HikeAired January 4, 2001 - 2:34 p.m. ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LOU WATERS, CNN ANCHOR: You may have seen at the bottom of the screen, while Joe Kennedy was speaking, that the California Public Utilities Commission has made a decision that will make those high electrical rates in California go even higher
We have CNN's Fred Katayama in San Francisco, who has been keeping a close watch on this story. How high can it go, Fred?
FRED KATAYAMA, CNN CORRESPONDENT: Well, Lou, much higher. The state's Public Utilities Commission just voted right now, unanimously, all five commissioners voting to approve the proposed rate hikes of electric rates to California consumers.
Now, California consumers, as a result, will see an average rate hike of 9 percent on their energy bills, a 7 percent hike for small businesses, 15 percent for large businesses.
The commissioners on the panel, some of them expressed reservations in their vote of approval. One saying that he is a free market economist, but he believes that the state now needs to establish a power authority to set the rules. Another commissioner, Carl Woods (ph), saying today that we are voting for the epitaph of deregulation. It is dead. Those are his words.
Having said that, many consumers will be upset about this. In a public comments session prior to today's decision, a lot of consumers called for a scraping of the rate increase, or a lowering of the rate increase. Some consumer advocates going so far as to say the utilities should be allowed to go bankrupt. One citizen said that utilities are better off being municipalized than being investor owned -- Lou.
WATERS: Fred, can you give us an idea what 9 percent mean to the average electric bill of a family in California?
KATAYAMA: Well, the average electric bill for a California household is about $60, a 9 percent increase would boost that bill by roughly around $5. Now, as for now, those who are in low-income categories will be exempt from the rate increase.
WATERS: What was the thinking behind big business taking the brunt of this rate increase?
KATAYAMA: Well, the commissioners did not go into that, in today's statement, but they did expect -- the new rules will expect that big business will be slapped with the biggest increase, an increase of 15 percent. They, of course, are the big users of energy.
WATERS: We will know more about this in the next day or so. Fred Katayama keeping track of the story in San Francisco.
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