Commentary: California's Utilities Doth Protest Too Much

Everything seems cold and dark at California's two biggest utilities these days. PG&E Corp. and Edison International say the deregulation of California's electricity market is killing them. The companies figure they have paid out nearly $12 billion more for power than they have collected from ratepayers in recent months. Edison Chairman John E. Bryson has been a fixture on TV, on the radio, and in newspapers in California saying that if Edison doesn't get some sort of compensation for those "undercollections," there could be blackouts in the Golden State.

Scary talk. And, no doubt, California's utility deregulation mess is dangerously close to spinning out of control. That's why on Jan. 3, the California Public Utilities Commission proposed a 9% residential rate hike for 90 days, a stopgap measure that will allow independent auditors to review the utilities as well as "their holding companies and affiliates." The PUC is expected to approve the measure on Jan. 4. That's a far cry from the 30% the utilities asked for.