California's Energy Crisis Moves from Bad to Worse

Experts say the refusal of gas suppliers to provide more goods on credit is typical when a customer appears to be teetering on bankruptcy. Suppliers who sign a contract after a bankruptcy filing usually have a better chance of getting their money back than those who signed before the bankruptcy went to court, bankruptcy lawyers and energy analysts tell GlobeSt.com.

Combined, LA-based Southern California Edison and San Francisco-based PG&E supply power to more than two-thirds of the state's commercial property owners and residences. The two corporate behemoths helped to push an energy-dregulation measure through the State Legislature a few years back, but now find that the smaller energy companies that deregulation spawned have lots of energy to sell--but at a premium price.

SCE and PG&E are now buying most of their power from those small energy companies at prices that far exceed those that the utilities can charge property owners. Though few commercial property owners and consumers are sorry about the huge utilities' plight, those same users may soon find themselves without power to switch on their lights or elevators, if SCE and PG&E can't get credit to buy more power.