Energy Secretary Addresses Power Crisis
Steps taken by President
Bush and Secretary of Energy Abraham to address the power crisis in California
and the Western states as outlined in Secretary Abraham's letter to Congress and
the California Legislature. (Continued
from page 1)
- "While the imbalance between supply and demand is the reason for high
energy costs and power shortages, the Bush Administration was the first to
take action on overcharges. FERC took unprecedented action and ordered the
first-ever refunds to address overcharges by generators on market-based
rates after we took office and after a Republican took over as Chairman."
- "On March 14, FERC issued a series of orders designed to expedite energy
supplies to California, including streamlining regulatory procedures for
wholesale power sales, expediting natural gas pipelines, and urging
hydropower licensees to assess the potential for increased hydropower
- "As follow up to a meeting with Governor Davis, I issued a letter
indicating that the Administration did not oppose the States proposed
purchase of the California utility transmission systems, conditioned on the
adherence to open access requirements."
- "Just two weeks ago, I met with a group of California energy suppliers to
impress upon them that the next several months should not be viewed as 'business
as usual,' and to ask for their help to avoid foreseeable disruptions in
- "Last week, I met with a group of electricity experts to discuss the California electricity crisis and to explore actions that could be taken by the federal government and State to increase supply or reduce demand. As you can see, the Administration has taken constructive action from its first day to help California deal with its electricity crisis. Governor Davis has expressed his appreciation to both the President and me for this help."
To the Bush Administration's opposition to imposing price controls on wholesale power sales in the West, Secretary Abraham responds, "The only thing we have opposed has been the imposition of price controls because they would not prevent blackouts and would drive away the new supply California and the West so badly need."
Secretary Abraham also pointed out that advocates of price controls had failed to "indicate how price caps would increase supply, decrease demand or prevent blackouts this year," and notes that governors of eight Western states had also expressed opposition to price controls. "Those eight governors reiterated their opposition in an April 6 letter to FERC Chairman Curt Hebert, calling them penny wise and pound foolish.'"
as Opportunity: Reality Check
"According to a recent poll, many Californians still do not believe that the energy crisis is real. Artificial restraints that prevent electricity prices from reflecting market realities are contributing to a false sense of security.
"Throughout the West, businesses are raising prices, getting creative about conservation. Others are closing. What caused it? Who's to blame? What can be done?" -- Get some answers from Electric Power & Utilities Guide Susan Erwin.