If you thought the massive electricity rate hike about to be rubber-stamped next week by the DWP Commission is bad news, think again.
There is even worse news today in the New York Times: The DWP “is losing about $6 million a week or an estimated $500 million by the
end of the 2011 fiscal year.”
Who knew? The DWP losing money? How is that possible?
Of course, it isn’t, The DWP just sent $147 million in “surplus” power revenue to the city general fund, part of its 8 percent annual revenue donation that comes on top of the 10 percent electricity tax. It just gave checks for 3.25 percent of their salaries to its 8,000 employees with some getting back pay raises for two years of up to nearly 6 percent and granted raises of up to 4 percent for each of the next four years.
But Jennifer Steinhauer — the NYT’s Los Angeles Bureau chief who’s heading to Washington to cover Congress — knows all about the DWP losing money along with other facts nobody in this left coast town has heard.
Nobody at least except Chief Deputy Mayor Jay Carson, who appears to the only source for Steinhauer’s exclusive report under the headline “Los Angeles Electric Rate Linked to Solar Power.”
Undoubtedly, Steinhauer and Carson crossed paths when she was covering the 2008 presidential race and he was Hillary Clinton’s spokesman so his word is as good as gold.
She reports that the DWP “is poised to pass a roughly 5 percent rate increase on electricity use…(the DWP Commission)
is expected to vote next week to increase by seven-tenths of 1 cent the
current user rate of 12 cents per kilowatt hour.”
That doesn’t sound so bad. But then it isn’t what the DWP is seeking unless Carson has shared with her insider information that none of us know. The 5 percent rate hike hardly would begin to cover the DWP supposed deficit and the provide for “renewable energy purchases and programs, including one that would repay people or businesses that use solar panels to contribute to the power grid.”
To Steinhauer, the rate hike “is equivalent to a carbon tax because all consumers will see rates fall
as the city becomes less reliant on coal-powered energy.”
I get it now: Rate hikes mean lower rates. No wonder she is best known for her obsession with rattlesnakes that are plaguing all of LA and even brings them into this story’s opening with the observation that in LA “environmentalists outnumber rattlesnakes in many parts of the sprawling
In contrast to Steinhauer’s report, the cost of going green runs into the billions of dollars and a 5 percent rate hike doesn’t come close to paying the bill. The DWP’s own consultant’s report calls for a rate hike of 2.7 cents per kilowatt hour — four times what Steinhauer reports — and Carson’s boss wants an additional surcharge as well with even higher rates coming year after year..
In Steinhauer’s math, the modest 5 percent rate hike will somehow “shore up the (DWP) budget shortfall, in the hope of protecting the utility’s
bond rating … (and) go to renewable energy sources, like wind farms, and to help subsidize a program that would essentially repay
solar-panel users for feeding energy into the power grid.”
Even beyond all those costs to be covered by the rate hike, “Mayor Antonio Villaraigosa and his staff are billing the increase as a move
that will bring jobs to the city. Los Angeles has never embraced the
idea of solar energy, largely because of the high cost of the programs.”
“There are so few solar panel manufacturing companies in the city,
mayoral aides have had to scramble to find an appropriate place to
announce the new plan later this week.”
“A well-crafted carbon surcharge achieves two goals,” Los Angeles’s
chief deputy mayor, Jay Carson, said. “The first is a drastic reduction
in fossil fuel usage for energy, but the second, and more important for
Los Angeles, is the creation of thousands of green-collar jobs.”
Finally, the dashing Jay Carson appears after having so successfully spun a New York Times star reporter who clearly made no effort to check the “facts” she was being spoon-fed.
The question arises then: What was Carson trying to achieve? A test drive of how the LA press corps and populace are going to be spun? Deluding Wall Street to somehow believe DWP actually has a solar plan so it will lend the utility money without lowering its bond rating?
I don’t know. I just thought you ought to know how the spinmeisters like Carson operate and how even star reporters like Steinhauer and newspapers like the NYT can’t be trusted any more than your ordinary citizen blogger without checking the facts yourself.