California electricity crisis (2000-2001)
After partial deregulation in 1996, California utilities faced wholesale power prices that spiked from $25 to over $1,400 per megawatt-hour. Enron traders exploited the market design, and the state experienced rolling blackouts. Pacific Gas & Electric declared bankruptcy. Ratepayers absorbed billions in costs through surcharges and long-term contracts the state signed at peak prices.
The state spent roughly $40 billion on emergency power purchases, and the crisis triggered rolling blackouts across the state.
California's electricity market remains partially deregulated, and the crisis poisoned public trust in shifting energy costs onto ratepayers.
The new data center laws answer the same question posed in 2000: who pays when a small group of highly concentrated users drives grid costs? California regulators and consumer groups carry direct institutional memory of ratepayers absorbing costs that were pushed off corporate balance sheets.