In his first visit ever to FERC, Energy Secretary BillRichardson yesterday drove home the need for a federal electricityrestructuring bill and the importance for the Commission to have acritical role in that effort.

“I know some critics suggest that FERC should not play such aprominent role. I disagree. I think that FERC has a vital role toplay…..because of your record [in restructuring], because therehas to be some oversight – not because we want to give you a newfunction,” he said in a speech to Commissioners, staff and energyindustry executives Wednesday.

Richardson noted this anti-FERC sentiment was the “genesis” fora critical advertisement in Roll Call, the newspaper that coversCapitol Hill. “If you look at the ad and you look at what a lot ofcritics are saying,” he said, the message is the same: that “youshould play no role” in electricity restructuring. “I think thatthat is dangerous.”

He urged the FERC Commissioners and staff not to “succumb” tosuch tactics or criticism. He noted the Clinton administration’stwo biggest problems with the legislation proposed by Rep. JoeBarton (R-TX) is its failure to give FERC authority to addressmarket-power problems in the retail market, and its reducedoversight role for the Commission.

The administration sees the Commission assuming “an evolutionaryrather than a revolutionary” function in restructuring the powerindustry, Richardson said. As such “we need to ensure that FERC hassufficient jurisdiction over all significant transmissionproviders, including the Department of Energy.” In addition, itneeds to be able to promote the development of regionaltransmission organizations (RTOs). And “FERC should have a role inprotecting the reliability of [the] bulk power grid.”

Richardson stressed the importance of federal legislation.”…..[S]tates are leading the way, but we need federal action. Weneed to reduce the [many] federal impediments that exist. Electronsdon’t heed state borders. Electricity markets are becomingincreasingly regional.”

The administration doesn’t support the Barton bill in itscurrent form, but “we do believe it has some positive elements and[is] a positive sign that Congress is making progress on thelegislation.”

“I think [the bill’s] now at a stage where the subcommitteeshould act on it, should not postpone, should do hopefully amarkup” and move the legislation to the full Commerce Committee,which then could take it up early next year, Richardson said. Henoted the subcommittee is scheduled to mark up the “revisedversion” of Barton’s bill next week.

Although he concedes it will be a difficult task, Richardsonsaid the administration still intends to push for a mandate thatwould require utilities to use renewable fuels to generate 7.5% oftheir electricity annually.

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