SCE SEEKING BREAKS FOR FIRMS.

Byline: Kevin Smith Staff Writer

ROSEMEAD - Southern California Edison has filed a rate-reduction proposal aimed at keeping manufacturing firms from shutting down or leaving the Southland because of high energy costs.

The plan submitted Tuesday to the California Public Utilities Commission would offer companies a five-year discount on their electricity rate - 25 percent the first year and 5 percent less each of the remaining four years.

``This would be applied to customers with 200 kilowatts or more of electrical demand,'' said Bill Bryan, vice president of SCE's Major Customer Division. ``When we talk about the commercial and industrial base here, that represents about 70 percent of the revenues our company takes in.''

The utility commission's review of SCE's Economic Development Rate - which is also designed to attract more manufacturing firms to California - will likely take several months, SCE officials said.

Applicants to the program would have to prove that, without the reduction, they would be forced to either leave the area or not move in from outside California.

Solid State Stamping, a Temecula-based company that makes electrical contacts for the automotive industry, may be among the first in line to use the program if it gains PUC approval.

The company is considering moving out of the Golden State because of high energy costs, rising workers' compensation costs and a host of other regulations, President and Chief Operating Officer Neil Allen said.

``It's not that we want to leave California ... but our energy costs are now about $400,000 a year,'' he said. ``Over the past five years it's gone up about at least 20 percent.''

Solid State operates a 45,000-square-foot facility and another 17,000- square-foot plant, both in Temecula. ``Our locations are only two miles apart, but the PUC won't let us combine them to get a more flexible (energy) rate,'' Allen said. ``They would have to be at the same address to get the discount rate. I don't understand why these kinds of regulations even exist. The cost of doing business in California is about 30 percent higher than in neighboring states.''

SCE spokesman Gil Alexander said the Rosemead-based utility company offered a similar rate-reduction program in the mid-1990s when the nation's economy was in another slump.

``Sixty-six companies qualified for the program and we estimate that 20,000 jobs were either retained or created as a result,'' he said. ``Retaining, attracting and growing business is important to us.''

Mike Worms, an analyst with the New York brokerage firm Harris Nesbitt Gerard, said SCE's proposal is not unusual.

``Companies in Michigan did a similar thing a couple years ago with the auto industry,'' he said. ``What Edison is doing is important. By helping to keep these companies from going under, they are also keeping the people who work for the companies in place as well.''

A division of Edison International, Southern California Edison is one of the nation's largest electric utilities, serving a population of more than 12 million via 4.6 million customer accounts in a 50,000-square-mile service area within Central, coastal and Southern California.

Kevin Smith, [phone], Ext. 2701

kevin.smith(at)sgvn.com