LA Dept of Water and Power To Sell Off The Golden Egg

[ilbegone]

My view:

DWP's infrastructure appears to be in terrible shape with maintenance of both overhead and underground circuits deferred for years. If nothing else, their underground lead circuits are aging and and will fail at an ever increasing rate until the whole system melts down if conductor replacement isn't maintained or even accelerated. The overhead is ratty and ready to come down and much of the underground is an unbelievable rat's nest example of construction.

To fix it takes tons of capital, which the utility has been forking over to clueless city government hacks who's knowledge of electrical systems are very hazy beyond the certainty that electricity comes out of the wall.

I believe they would practically have to give the Electrical utility portion away in order for an investor owned utility - such as SCE - to take over.

As far as the stink raised over the guys who were busted going to strip joints and other egregious activities (snitched out to the media by a fired coworker who participated in the fun while employed by DWP) while negotiated raises went into effect: Everyone from Beutner at the top down to the very last hired employee could work for free and it would probably make a difference of less than one percent of the total operating budget.

On the other hand, I hear different stories concerning the general work habits of DWP field employees. I have no idea of what is the truth (I don't work with or around them), but it is my belief that for an investor owned utility to absorb government employees it would be difficult for both management and labor, and SCE has brought a lot of negative consequences on itself by attempting to radically modify its workforce almost overnight in the early 90's.

SCE management had the same ideas then as blustering LA newspaper columnists and ignorant LA city councilmen do now, that there are thousands of people who would line up for those jobs. Which may be true on the surface, but qualified employees aren't to be found at the end of a two week dog and pony show.

Continued below.

[ilbegone]

Villaraigosa's astounding willful ignorance and determination to push on despite all the facts beating him about the head and shoulders is unbelievable.

His city is broke, I believe his falling apart utility is the only significant contributor to city revenue left, and Villaraigosa and his city council play the part of lemmings in a mad tragicomedy about rates, money transfers, sell offs, lease backs, and "green power" as well as meddling in Arizona's affairs.

I understand DWP has bewildering array of perhaps the lowest electrical rates for housing in the country, and I believe certainly so when compared to neighboring utilities and municipalities.

I have no idea of what the figures are now, but I recall that 20 years ago Edison was required to buy alternative (green) energy at the highest avoided cost of constructing new generation facilities, which I believe was something as preposterous as 4 or even more to 1.

The investor owned utilities were forced to sell off generation capacity by out of touch state politicians in Sacramento who believed that deregulation would force "competition" and lower rates, but all that was accomplished was pulling down the collective pants of Californians who were raped unmercifully by out of state carpetbagger power brokers while FERC gleefully stood by and watched.

That melt down is a large part of why we have our state budget deficit problems now - goofy f-ing politicians thought they would break the utilities by forcing them to buy power high and sell it low, but the utilities shoved it back on the politicians - PG&E by heading towards bankruptcy court and Edison by shifting its capital to legally separate subsidiaries (out of reach of legislative jack asses) and telling the state that it had to finance the over cost from then on or the lights were going off.

I believe that when Edison was forced to divest its generation facilities, the dogs were sold to out of state jackals and profitable facilities were spun off to legally separate subsidiaries.

In the meantime, DWP - a governmental municipality rather than a corporation such as SCE and not forced to divest its generation - made a killing selling overpriced power to the state.

Ok, off my soap box.

[ilbegone]

The Los Angeles Department of Water and Power is considering selling off its headquarters, shares in out-of-state power supplies and other assets instead of raising customer rates.

I don't believe it is the DWP so much as those running the city.

There is a lot of political pressure against raising rates, and in that vein Beutner (temporary head of DWP who's an investor and never has been a part of any utility operation) said something to the effect that DWP could afford to own its offices or it could afford to buy green power, but not both.

And he didn't care which - those were the choices.