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PG&E Corporation Message Board

  • mentges mentges Oct 19, 1998 1:44 PM Flag

    Prop 9 Poll

    I thought I saw a poll on KTVU(Oakland) Channel 2 that indicated it was ahead in the polls - does anyone else remember this - I believe last Friday.

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    • Can you guys explain proposistion 9 and how it
      relates to PG&E stock. I am from out of state and sunk
      some money into this utility when they were taking
      over TX operations. I assume it refers to
      deregulation.

      TD

      • 1 Reply to Thunderduckou812
      • PCG and the other two CA utes were granted 100%
        retail stranded cost recovery. What is
        this?

        Well, over the years PCG has bought assets that are
        very expensive. Some they had no choice and had to
        purchase, like expensive contracts with "green" power
        producers. But others were things like nuclear power
        plants.

        So in a deregulated environment some of PCGs
        customers will leave and since PCG has no one else to pass
        this cost along to the asset becomes "stranded". They
        dont have a rev. stream to service
        it.

        Therefore, the CPUC authorized PCG et al to include their
        stranded costs in the local delivery lines. This has had
        the affect of artificially inflating new competitors
        overhead costs. The grand total of the bailout is 28
        present value dollars for all three
        utilities.

        Prop 9 takes back the portion of stranded costs that
        PCG et al entered into on a voluntary and business
        judgement basis. It also takes back some of the funky
        financing they put together to do it. About 6Bil
        total.

        Why hold on to your hat? Well cowboy, TX has the
        second highest stranded costs next to CA.

        GG

 
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