When compared with California’s botched deregulation, which has left the state with rolling blackouts and outrageous electricity rates, it’s easy to see why Oregonians would be worried about their own deregulation plan.
Oregon energy officials say, however, that Oregon’s deregulation, set to begin Oct. 1, will be completely different than California’s.
The deregulation legislation, Oregon Senate Bill 1149, was passed during the 1999 legislative session. The enactment is designed to give customers of investor-owned utilities, such as Portland General Electric and PacifiCorp, the option of entering the wholesale energy market. This does not include the publicly owned utility Eugene Water and Electric Board, which is Eugene’s energy provider.
The bill states that a customer of an investor-owned utility will be given energy portfolios to choose from, one of which will allow a customer who has a 30 kilowatt-hour demand or more to enter the wholesale energy market. This would allow the customer to by-pass the utility and, in theory, possibly pay less for energy.
Bob Valdez, Oregon Public Utility Commission spokesman, said the deregulation is very different from California’s deregulation, which forced customers into the deregulated market.
Senate Bill 1149 “only gives customers the option of entering into the wholesale market, and each customer has the option of staying with their current energy plan,” Valdez said.
But Oregon’s deregulation will not affect Oregon homeowners at all, except in very abstract circumstances, said Dick Varner, EWEB’s fiscal services supervisor.
“No resident will have a 30 kilowatt-hour demand,” Varner said. “Only some small and most large businesses have that high of a demand.”
The bill will have the biggest impact in Portland and Salem, which each have customers who are serviced by investor-owned utilities. The bill could directly affect Eugene only if EWEB decided to allow its customers the same options as the investor-owned utilities.
“The target is on large industrial customers that could potentially benefit from going to directly to the wholesale market,” Valdez said.
Still, U.S. Rep. Peter DeFazio, D-Ore., plans to work toward repealing the bill.
“Even though the bill itself won’t directly affect Eugene, the effects on the wholesale market from deregulation could effect Eugene,” DeFazio said.
State Rep. Bob Ackerman, D-Eugene, who is working with DeFazio to repeal the deregulation bill, said deregulating the Oregon energy market will open it up to profiteering.
DeFazio and Ackerman’s concerns about deregulation stem from the inevitable energy price increases now hitting the Northwest. While EWEB has been putting off increases for as long as possible, the current drought, high demand for energy and California’s deregulation have driven up prices on the wholesale energy market and caused the current energy crisis.
Valdez argues that deregulation will have no effect on the price of energy. He says increases are inevitable, and deregulation will only give customers more options.
“It’s the supply-and-demand issue that is causing the price increase,” Valdez said.
Mat Northway, EWEB’s manager of Energy Management Services, said most customers won’t want to enter the deregulated market anytime soon anyway because of the wholesale market’s current conditions.
“When market prices go down, deregulation will be offering the option for customers to find lower prices,” Northway said.