BILL NUMBER: SJR 7	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JUNE 4, 2001
	AMENDED IN SENATE  MARCH 20, 2001

INTRODUCED BY   Senator Alpert
    (Coauthor:  Senator Morrow) 
    (Principal coauthor:  Assembly Member Cohn) 
    (Coauthors:  Senators Bowen, Escutia, Figueroa, Kuehl,
Morrow, Ortiz, Polanco, Scott, and Sher) 
    (Coauthors:  Assembly Members Aroner, Havice, Kehoe, Koretz,
Lowenthal, Pavley, Vargas, and Wayne) 

                        MARCH 1, 2001

   Senate Joint Resolution No. 7--Relative to wholesale electric
prices.



	LEGISLATIVE COUNSEL'S DIGEST


   SJR 7, as amended, Alpert.  Federal Energy Regulatory Commission:
wholesale electric prices.
   This measure would memorialize the President of the United States
and the Congress to support legislation introduced in the Congress
requiring the Federal Energy Regulatory Commission to:  (1) order a
refund of the portion of any rate or charge that exceeds the rate or
charge that the commission finds to be just, reasonable, and not
unduly discriminating or preferential; and (2) issue  an
  a temporary  order to establish the maximum price
for electricity sold at wholesale subject to the jurisdiction of the
commission in the Western Systems Coordinating Council for any
period after June 1, 2000, if the commission determines that any rate
charged for the wholesale sales of that electricity is unjust,
unreasonable, unduly discriminatory, or preferential.
   Fiscal committee:  no.




   WHEREAS, As part of California's deregulation of the electric
utility industry, the new owners of the electric generating plants
that were sold by the state's investor-owned utilities are regulated
by the federal government; and
   WHEREAS, The Federal Energy Regulatory Commission (FERC) granted
electric generators the ability to charge market-based rates with the
understanding that in a workably competitive market, market-based
rates will always produce "just and reasonable" prices; and
   WHEREAS, Commencing in May of 2000, and continuing to the present,
wholesale electric prices throughout much of the western United
States have climbed to unjustifiable levels; and
   WHEREAS, High electric rates threaten not only California's
consumers, its neighbors, and businesses, but the economy of the
entire nation; and
   WHEREAS, FERC has preliminarily found that a wholesale electric
seller in California withheld electric supply in order to raise
prices to California citizens and businesses; and
   WHEREAS, FERC has issued two orders that state that the rates
currently being paid generating plants for electricity are "unjust
and unreasonable," and, nevertheless, the commission has ordered only
minimal refunds and refused to examine thousands of wholesale
transactions whose prices exceed the level that FERC set as the
threshold for examination and has further refused to revoke the
ability of electric generators to charge market-based rates; and
   WHEREAS, Accordingly, it is necessary to enact federal laws to
require FERC to order a refund of the portion of any rate or charge
that exceeds the rate or charge that the commission finds to be just,
reasonable, and not unduly discriminating or preferential; and
   WHEREAS, It is also appropriate for the federal government to
require FERC to issue  an   a temporary 
order to establish the maximum price for electricity sold at
wholesale subject to the jurisdiction of the commission in the
Western Systems Coordinating Council for any period after June 1,
2000, if the commission determines that any rate charged for the
wholesale sales of electricity is unjust, unreasonable, unduly
discriminatory, or preferential; now, therefore, be it
   Resolved by the Senate and Assembly of the State of California,
jointly,  That the Legislature of the State of California
memorializes the President and the Congress of the United States to
support legislation introduced in Congress requiring FERC to do both
of the following:  (1) order a refund of the portion of any rate or
charge that exceeds the rate or charge that the commission finds to
be just, reasonable, and not unduly discriminating or preferential;
and (2) issue  an   a temporary  order to
establish the maximum price, which shall be based on the seller's
costs, including a return of  and on   , and on,
 invested capital, for electricity sold at wholesale subject to
the jurisdiction of the commission in the Western Systems
Coordinating Council for any period after June 1, 2000, if the
commission determines that any rate charged for the wholesale sales
of that electricity is unjust, unreasonable, unduly discriminatory,
or preferential; and be it further
   Resolved, That the Secretary of the Senate transmit copies of this
resolution to the President and Vice President of the United States,
the Speaker of the House of Representatives, and to each Senator and
Representative from California in the Congress of the United States.