POWER CRISIS TIMELINE 1996 -- Republican Governor Pete Wilson signs a law to restructure the state's power market, moving California toward full competition in 2003. Utilities, consumer groups and state regulators had combined to write the law. Wilson and others say it's designed to cut power rates for consumers. The state's three biggest publicly traded utilities agree to sell their power plants to pay off debt. 1998: The California Power Exchange opens. Utilities were obligated to buy and sell power on the exchange for delivery the next day. They were unable to buy in forward markets for delivery weeks or months ahead. Regulators, after granting an initial 10 percent rate cut for consumers, froze rates until the utilities' power plants were sold.

June 2000: California wholesale power prices begin to climb as a heat wave increases demand for air conditioning. Supplies are strained because no new power plant of any size has been built in the state for more than a decade. The average electricity price rises to $187.31 a megawatt-hour during the month, up sixfold from a year earlier.

Sept. 25: Edison International said its Southern California Edison unit has had insufficient revenue to cover its costs since May, and may have to take a one-time charge.

Oct. 4: PG&E asks state regulators to let it charge consumers more than $2 billion to cover power-buying costs from the previous four months.

Nov. 16: Southern California Edison asks a federal court to let it charge customers $2.64 billion for losses from open-market power purchases this year.

Dec. 7: California declares its first-ever ``Stage Three'' power alert, an emergency that allows the state's power-grid manager to require utilities to cut power to some customers.

Dec. 22: Edison said it will eliminate its fourth-quarter dividend and $100 million in investments as it tries to cope with billions of dollars in power-buying losses.

Dec. 27: PG&E asks state regulators to let it increase electricity rates by 26 percent to recoup $4.5 billion in power- buying losses, a day after Edison asked for a 30 percent increase.

Jan. 4, 2001: The California Public Utilities Commission grants an average rate increase of 10 percent for customers of PG&E and Edison. Both companies say the increase won't be enough to stave off bankruptcy.

Jan. 8: In his state of the state address, California Governor Gray Davis calls the deregulation plan a ``colossal and dangerous failure'' and calls for tighter regulation of out-of- state power generators, whom he accuses of price gouging. Davis threatens to use the power of eminent domain to ensure the lights stay on, and offers a number of measures for overhauling the state's electricity market.

Jan. 18: Davis declares state of emergency following blackouts, and state steps in to buy power on behalf of Pacific Gas & Electric and Southern California Edison. The two utilities have almost run out of cash and are having trouble getting credit to buy more power.

Feb. 1: Davis signs a bill authorizing the state to sell as much as $10 billion of bonds and use the proceeds to buy power for the cash-strapped utilities under multiyear contracts.

Feb. 17: Davis unveils a rescue package intended to keep PG&E and Edison from declaring bankruptcy. It calls for the state to buy the utilities' power-transmission lines and refinance their debt with bonds. Utility rate-increases wouldn't be necessary, Davis says.

Feb. 23: California negotiators reach conceptual agreement to by Edison's power lines for $2.76 billion.

March 1: State grid operator asks federal regulators to investigate its claim that generators overcharged California and its utilities by $555 million in December and January.

March 5: Davis says the state agreed to buy electricity from more than 20 suppliers under multiyear contracts.

March 9: California Power Exchange files for Chapter 11 bankruptcy protection. U.S. regulators order generators to refund about $69 million to utilities or justify high prices.

March 19-20: Blackouts are called from San Diego to Fresno after some generators shut down amid unseasonably warm weather.

March 23: Davis aides tell legislators California may spend more than twice what was forecast on power, and rates may have to rise.

March 27: California Public Utilities Commission approves a rate increase of as much as $4.8 billion a year for Pacific Gas & Electric and Southern California Edison. Including power delivery charges, the average increase is about 36 percent for PG&E customers and 27 percent for Edison customers. It comes on top of the 10 percent approved in January.

March 28: State Controller Kathleen Connell says the rate increases won't be enough to cover California's power-buying costs, and will leave the state with a deficit by October. The state's budget surplus has dropped from $8.5 billion in January to $3.2 billion, Connell said.

March 30: PG&E says it may take $4.1 billion charge for power-buying losses.

April 5: Davis admits rate increases may be necessary in speech carried throughout California. Calls electricity shortage a crisis for the first time. He says that only solution to the power shortage is the construction of more plants.

April 6: Pacific Gas & Electric files for Chapter 11 bankruptcy protection.

-- Source: Bloomberg

-- PHO (owennos@bigfoot.com), April 24, 2001

Answers

The Latest Developments WHAT'S NEXT:

Davis' representatives continue negotiating with Sempra, the parent company of San Diego Gas and Electric Co., to buy the utility's transmission lines. Davis says he expects to have an agreement within two weeks.

Senate Select Committee to Investigate Price Manipulation of the Wholesale Energy Market continues its investigation next week. MONDAY:

Legislators are expected to review the budget of the Department of Water Resources, which has been buying power for the state's beleaguered utilities.

David Freeman, a top energy adviser for Gov. Gray Davis, speaks to local government leaders at a conference on how to protect consumers from the state's power woes. FRIDAY:

The state's power buyers ask for another $500 million to keep buying electricity for customers of Pacific Gas and Electric Co. and Southern California Edison. The request by the DWR brings the total authorized for power buys to $5.7 billion since January, when the state stepped in to prop up the two utilities.

Edison executives say they hope the Legislature won't tinker with the "balanced" deal reached by the governor and Edison officials under which the state would buy Edison's power lines for $2.8 billion. "It's either the agreement or bankruptcy. It's that simple," said Bob Foster, an Edison vice president.

Administration officials brief lawmakers on the Edison deal. Assemblyman Fred Keeley, D-Boulder Creek, says legislators still need a lot more details.

Edison International's stock closes at $10.98, down 42 cents, while stock in PG&E's parent company closes down 31 cents at $8.73. 4.23.01

From The Associated Press

-- PHO (owennos@bigfoot.com), April 24, 2001.