Several congressional lawmakers from California yesterdayrenewed their pleas for help from the Bush administration to endthe power crisis in their home state, with some urging a Housesubcommittee to direct FERC to install caps on wholesale power inthe short term while others suggested adjusting Daylight SavingsTime in the region to conserve power.

One lawmaker, Rep. Bob Filner (D-CA), has gone as far as to askthe San Diego District Atttorney’s Office to bring criminal fraud,larceny, extortion and antitrust violation charges against what hecalled a “cartel” of seven out-of-state wholesale generators forallegedly bilking the state out of billions of dollars over thepast year by overcharging on electricity.

“The energy cartel.has taken $20 billion [out] of our state inthe last six or seven months,” he testified at a House Energy andAir Quality Subcommittee hearing Tuesday during which lawmakersaired their views on the problems in California electricitymarkets. The members of the so-called cartel include Duke Energy,Dynegy, Reliant Energy, Southern Companies and the WilliamsCompanies and their affiliates, he contends.

The prices charged by these out-of-state companies have been”illegal,” Filner told the subcommittee, and yet FERC has taken “nosanctions against the perpetrators.” In effect, the Commission hasinvited them to “go in and rob the state blind, then rob the regionblind, and then rob the country blind.”

As for the cartel’s alleged activities, Filner said “there isevidence of illegal withholding of power; there is evidence offalsifying transmission documents to raise prices; [and] there isevidence of laundering electrons through other states when therewas a cap in California.”

Filner told NGI he used the harsh words — fraud, larceny andextortion — for emphatic reasons. “Everybody is using euphemismslike ‘gaming’ and ‘unjust and unreasonable rates.’ I want thepublic to know what’s going on.” He also wants Congress and FERC tofocus its attention on the wholesale suppliers.

“This cartel is stealing our economic future. They are robbingour bank accounts. They are killing off our businesses, and I thinkthe committee ought to concentrate on bringing this energy cartelto justice.”

Rep. Jay Inslee (D-WA) saved his criticism for the Bushadministration, saying while it responded quickly to the recentearthquake in his state, it has failed miserably in its response tothe energy crisis engulfing California and the western region. Thefederal government “has been a pathetic disaster [in and of itself]in refusing to come to the aid of the West.”

He noted the administration already has a “tool at its disposal”to deal with the power crisis — short-term price caps onwholesale power sold in the western region. But “they’re concernedit will end up being a long-term rather a short-term price cap,”which he conceded was a “legitimate concern.” He believes this canbe dealt with by structuring the price cap in such a way as toensure it will be temporary. As for concerns that a cap would be adisincentive for new generation capacity, Inslee said that could beeasily resolved by exempting new generation from the cap.

“We need the administration to sit down in a bipartisan fashionto fashion a wholesale price cap” that addresses these issues, hetold the subcommittee. In response to critics who have said this isa California-only problem, he noted Federal Reserve Chairman AlanGreenspan last week “pinpointed energy prices as one of thegreatest danger signals to the U.S. economy.”

Subcommittee Chairman Joe Barton (R-TX) didn’t seem to thinkprice caps would have much merit. “.[O]bviously there would be someshort-term benefit or should be some short-term benefit, but Idon’t see that that helps” to resolve the market problems in thelong term, he said. By imposing a cap on wholesale power priceswithout also restructuring retail rates, “don’t you just extend theproblem around the region, around the country?” he asked.

But Barton warmed to a proposal by Rep. Brad Sherman (D-CA) toallow California and other Pacific time zone states to alterDaylight Savings Time in order to conserve electricity. It “lookslike an idea whose time may have come,” Barton commented.

Sherman already has proposed the action in legislation (H.R.704), and asked the subcommittee to quickly mark up the bill. Heestimates California could save 1-2% on energy consumption bymaking the adjustment to Daylight Savings time. Sherman noted thisaction was first taken during World War I, and has been re-employedduring other times to save energy.

Several lawmakers also called for the subcommittee to supportproposals — such as drilling in the Arctic National WildlifeRefuge (ANWR) — to increase the nation’s supply of natural gas, aprimary fuel for electricity generation. Without new gas supplies,they noted that the problems in the California and regional powermarkets would persist.

“There is an arrogance in the view that it is acceptable todevelop resources off the coast of Sable Island to meet the needsof New England, but that it is not acceptable to develop the sameresources off of our own coasts. If ANWR was located in Canada,would it [the United States] be equally as environmentallyconcerned” about drilling in that region?” asked Rep. GeorgeRadanovich (R-CA).

Rep Darrell E. Issa (R-CA) agreed. “There is sufficient naturalgas around the world if we [California] had the willingness tobring in liquefied natural gas. California has not been willing to,and I do not expect them to.”

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