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Hebert: CA Has ‘Grasp’ on Crisis
Although he is “sympathetic” to the plight of electric customersin California, FERC Chairman Curt Hebert Jr. said yesterday hebelieves the Commission should stay clear of the state and let itsolve its own problems — at least for now.
“I am one who believes that when there are state problems weshould let the states do what they can to resolve their conflicts.And it is my belief…[that] the worst thing we can do is get intheir way,” the new chairman said.
Gov. Gray Davis and the California legislature are “workinghard” to resolve the power crisis, he noted. “We have to give themthe opportunity to do that…I think that they’ve got a grasp onthe problem. I don’t think they need us at this point to doanything.” However, Hebert conceded that something could occurtomorrow to “change our minds.”
President George W. Bush, who appointed Hebert as FERC chairmanon Monday, also favors a state solution to the continuing powercrisis in California. “President Bush has made it clear that [in]situations like California, we need to be careful” to prevent thecrisis from spreading to other states, Hebert said.
Hebert made the remarks during an impromptu press briefing thatwas held following the Commission’s regular meeting Wednesday. Hestressed that he was not advocating a more limited role for FERCtowards California.
“I don’t care what has to be done or what needs to be done, I[am] willing to do that if it helps the folks in California,” hesaid. But he believes the state should be given first crack atsolving its own problems.
In the meantime, “I’m not aware of anything that we’re doingright here at FERC at this moment” to provide relief in California,Hebert noted. But “I think you’ll see this Commission continue totry to give guidance to California.”
He said he plans to meet with Sen. Dianne Feinstein (D-CA), whohas claimed FERC has been like an “ostrich with its head in thesand” with respect to California. She has been sharply critical ofthe Commission’s failure to step in and set “just and reasonable”wholesale power rates in California despite alleged evidence ofmarket-power abuse by suppliers in the state.
“No one’s provided me with any information” that would suggestthat “illegal conduct” has occurred or is occurring in California,Hebert countered.
He also noted that Energy Secretary Spencer Abraham plans tomeet with a number of western governors in Portland, OR, on Feb. 2to discuss the issue of a regional price cap. Hebert is opposed toprice caps of any form, saying they could cause long-term damage ina number of power markets.
In an unrelated matter, Hebert said he will have threepriorities as chairman: 1) getting regional transmissionorganizations “up and running; 2) dealing with electric and naturalgas pipeline deliverability issues; and 3) hydroelectricre-licensing.
He further noted that he does not intend to “erase or do awaywith anything” that former Chairman James J. Hoecker did during hismore than three-year tenure at the FERC helm.
Lastly, Hebert said he has set up a team led by his legaladvisor, Joshua Z. Rokach, to deal with the backlog of nearly 2,000cases at the Commission. “We need to move forward” with thesecases, Hebert said.
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