Davis Signs Bill to Aid Utilities

SACRAMENTO —  Gov. Gray Davis signed a bill Tuesday to speed the recovery of two private utilities badly wounded by the electricity crisis.

Of a dozen energy-related bills enacted, AB 57 by Assemblyman Roderick Wright (D-Los Angeles) will most strongly shape California’s electrical system over the coming year. It tries to get Southern California Edison and Pacific Gas & Electric back in the business of buying electricity for their 24 million customers.

The state itself has been buying electricity for utilities for more than a year. But the emergency law that put the state in that unprecedented job expires at the end of this year.

With PG&E; in bankruptcy and Edison still in debt, neither utility is well situated to buy power again. Wright’s legislation tries to assure Wall Street lenders that the utilities will be able to pay their bills and therefore deserve investment grade status. It does so by automatically triggering rate hikes if the utilities’ costs outstrip revenue by more than 5%. Conversely, should costs fall more than 5%, so would rates.

“It begins to put confidence back in the financial community that California will not repeat the energy crisis of 2000 and 2001,” said Robert Foster, president of Southern California Edison. Without the new law, he said, it would be “virtually impossible” for Edison to begin buying electricity again.

Wright’s bill also tries to correct what in hindsight stands out as a significant cause of the utilities’ trouble in 2000 and 2001--a lack of long-term power contracts--by requiring the Public Utilities Commission to review contracts before they are signed.

Davis also signed AB 58 by Assemblyman Fred Keeley (D-Boulder Creek) to encourage use of solar energy by giving homeowners and businesses credit for surplus electricity pumped from their solar panels into the electrical grid.

Another bill signed by the governor, SB 772 by Sen. Debra Bowen (D-Marina del Rey), requires Internet service providers to give customers 30 days’ notice before they cut off service. Thousands of people abruptly lost service in 2001 when Excite@Home Corp. and NorthPoint Communications shut down without warning.

“It’s about time you have the right to know well before you’re going to lose your Internet service,” Bowen said.

Working his way through the remaining 400 bills sent to him by the Legislature, the governor also enacted laws aimed at protecting domestic violence victims.

One of those bills, SB 1320 by Sen. Sheila Kuehl (D-Santa Monica), makes it easier to convict stalkers by establishing a pattern with only two incidents.

Davis, meanwhile, postponed a fund-raiser scheduled for Tuesday in Palo Alto, to be hosted by the Silicon Valley political group Technology Network. Campaign spokesman Roger Salazar said the decision to put off the event until October had nothing to do with Republican candidate Bill Simon Jr.’s recent criticism of Davis’ fund-raising.

Rather, Salazar said, Davis was busy at the governor’s conference in Long Beach that focuses on women’s issues. “It has nothing to do with anything other than the fact the governor has an awful lot of work on his desk,” Salazar said.

In another campaign development, Davis will launch a multimillion-dollar direct-mail blitz this week aimed at women, environmentalists and ethnic groups, Salazar said.

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Times staff writers Dan Morain and Matea Gold contributed to this report.