FOR MANY Californians, fear of high electricity bills is a bigger threat than blackouts

<br>SAN DIEGO (AP) _ Ray Marquez wonders whether he'll have to cut back on food or gas in order to pay his electricity bill. <br><br>The 34-year-old Orange County maintenance man usually pays $80 a

Thursday, May 10th 2001, 12:00 am

By: News On 6

SAN DIEGO (AP) _ Ray Marquez wonders whether he'll have to cut back on food or gas in order to pay his electricity bill.

The 34-year-old Orange County maintenance man usually pays $80 a month for power during summer months. Now, he's trying to figure out how to pay an electricity bill that could push $130 come June 1.

``Since I got married and had children, you know, I've been dealing with balancing bills,'' he said Wednesday. ``But if I now have to pay more for electricity, I'm not going to have money for gas or food for the kids.''

As Californians coped with rolling blackouts that darkened thousands of businesses and homes Monday and Tuesday, many struggled with an even bigger worry: how to pay for soaring energy costs.

In March, the state Public Utilities Commission approved the biggest rate increase in California history, up to 46 percent for customers of Southern California Edison and Pacific Gas & Electric. Those rate hikes start hitting customers in next month's bill.

Gailen Kyle, who raises alfalfa on 1,600 acres in the Mojave Desert, says a 40 percent increase would put his farm out of business.

``It would end us,'' the third-generation farmer said. ``Everybody here that farms alfalfa would be out of business.''

Kyle, 46, said he has to pump water nearly around the clock from wells drilled 310 feet below his farm near Lancaster. A small increase in the price of energy a few months ago added $80,000 to the $400,000 annual bill he was already paying.

To save money, Kyle agreed to become an ``interruptible'' customer, meaning he voluntarily allows his power to be shut off during statewide electricity shortages in exchange for reduced rates. So far this year, his power has been cut 26 times.

Even before the state utilities commission raised rates, residents were paying 26 percent more for electricity than the nationwide average, according to federal statistics. Only customers in New England, New York, Alaska and Hawaii pay more.

One of the problems is that the wholesale cost of electricity has risen sharply over the past year but under California's 1996 deregulation law the state's largest utilities, PG&E and SoCal Edison, have been prevented from passing their costs to customers. In April, PG&E declared bankruptcy.

The West isn't just facing spiraling costs and a shortage of supplies, however. Its transmission system is fragmented and overworked and would take years to improve, power officials told the region's governors Wednesday.

``There is no immediate solution,'' said Idaho Gov. Dirk Kempthorne, one of four governors participating in a six-hour, round-table meeting with industry representatives.

The Western Governors Association was told there is no established method for paying for transmission upgrades, and market and regulatory barriers stand in the way. It's not even clear where new power lines are most needed.

The group, which included the governors of Utah, Idaho, Montana and Wyoming, has given energy experts until July 15 to recommend ways to eliminate bottlenecks.

Meanwhile Californians, who've already weathered six days of rolling blackouts this year, fear they'll soon be paying more for less service.

The Independent System Operator, which runs the state's power grid, has forecast more than 30 days of blackouts this summer due to severe shortages of electric supply.

Dee Ann Hendirx, 53, of San Francisco, has stocked up on candles and battery-operated clocks.

``I hate to say this but it's getting to be a way of life in California,'' she said.