FERC Chairman Curt Hebert Jr. said yesterday that he has alreadywelcomed the two Commission nominees – Texas regulator Pat Wood IIIand Pennsylvania regulator Nora M. Brownell – on board, and did notappear to be overly concerned that Wood might replace him down theroad.

“I…..called them both yesterday [Tuesday and] congratulatedboth of them. [I] look forward to working with them,” he saidduring a press briefing following the Commission’s regular meeting.Hebert noted he already knew the state regulators quite well.

When asked if he thought his own job would be jeopardized byWood’s arrival at FERC, Hebert simply said, “I serve at the willand pleasure of the President.” He said he has not been told byPresident Bush that his days as FERC chairman are numbered.

Since both Wood and Brownell come from areas where price capsare in effect for wholesale power sales, Hebert could soon findhimself in the minority at the Commission in his opposition tocaps. When asked if he thought the new Republican commissionerswould side with him or with Commissioner William Massey (whoadvocates caps), Hebert said, “my friends will side with me.” Hecontinued, “I’m fortunate in that I have friends in this city, andwe are like-minded.”

Nor, he indicated would he be eager to bring the price-cap issueup for a vote if Commissioner Linda Breathitt (who is undecided onthe issue) were to join Massey in support of price caps. He said hewould continue to rail against caps until someone could show himthey would bring “long-term differences and not short-termmistakes.”

Hebert said he would keep an “open mind” to an expected proposalfrom New York City Major Rudolph Giuliani for a $250/MWh price capfor the Northeast. “God bless the mayor.”

If Rep. Joe Barton (R-TX) should call for FERC to conduct aSection 206 investigation into wholesale power prices as part ofemergency legislation for California, the chairman said theCommission would carry out the directive. “Certainly, if we getcongressional direction, we’ll take it.”

But he expressed some reservations about such a probe.”…[T]here are many people who want price caps in the Northwest.One way to get there is through a 206 [investigation]. It could beargued [that is] the only way to get there. So I have to be carefulin doing that. We’ve not seen the need to do that at this point.”

On a related issue, Hebert said the Commission will act quicklyon the responses of power suppliers to the orders directing them topay refunds in California. “I’ll give people an up-or-down call assoon as possible.”

He further said that he has joined his colleagues in theirsupport of giving FERC siting authority over power transmissionfacilities. “Unfortunately, I think we’ve got to move in thatdirection…..I think the RTOs are going to move us in thatdirection.”

Hebert indicated that he supports the move by Californiaregulators to increase electric rates at the retail level by about40%. Although “I am always sympathetic to anyone who has to gothrough a rate increase,” he said he believes the hike will sendthe proper price signals to curb demand.

He was vague on the issue of whether FERC intends to conduct astudy into the ever-widening basis differential between prices fornatural gas in Southwest supply basins and at the Californiaborder, as requested by Sen. Pete Domenici (R-NM) recently. “We’recommunicating back with the Senate on that,” he told NGI.

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