Story Outline

 

Energy Regulation Debate From a news story by CNN San Francisco Reporter Rusty Dornin January 3, 2001

I. California de-regulated its electric power industry

A. This was an attempt to increase competition between power providers.

B. It was hoped that this would give consumers better prices for electricity.

C. Price caps were removed to allow for a free market.

II. The de-regulation of the electric power industry has started a crisis.

A. Electric power producers hiked prices.

B. The costs of electricity increased for consumers.

C. Demand for electricity increased because the California economy was good.

III. Many people and groups want the Federal Energy Regulatory Commission to cap prices for electricity.

A. The Governor of California, consumer, the utility companies and California regulators want the Federal Government to help keep prices from going higher.

B. The Federal Energy Regulatory Commission asked for longer-term contracts between power producers and utilities in hopes of stabilizing prices.

C. The Federal Energy Regulatory Commission refuses to put temporary price caps on electricity.

IV. There are disagreements about the use of price caps.

A. Some people say that the electricity crisis in California will continue unless there are price caps.

B. Other people say that price caps never work. They say, instead, that the system needs to adjust to the forces of supply and demand.

C. There is a difference of economic philosophy between those who want price caps and those who do not want them.

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