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AP Online, April 20, 2001; Friday, 7:57 AM, Eastern Time, Financial pages,
????238 words, Power Co. Executives Lose Bonuses, LOS ANGELES Contra Costa Times, April 20, 2001, Friday, STATE AND REGIONAL NEWS, K560, ????460 words, Energy officials accused of manipulating natural gas market ????defend actions, By Andrew La Mar Los Angeles Times, April 20, 2001, Friday,, Home Edition, Page 3, 715 words ????, CALIFORNIA AND THE WEST; ??A U-TURN ON CAR TAX REBATES; ??LEGISLATION: ????STARTING JULY 1, FEE REDUCTION WILL BE FIGURED DIRECTLY INTO VEHICLE ????REGISTRATION BILLS, NOT REFUNDED BY MAIL., CARL INGRAM, TIMES STAFF WRITER, ????SACRAMENTO Los Angeles Times, April 20, 2001, Friday,, Home Edition, Page 3, 453 words ????, CALIFORNIA AND THE WEST; ??LOCKYER ASKS JUDGE TO ORDER FIRMS TO RELEASE ????RECORDS, ROBERT J. LOPEZ and RICH CONNELL, TIMES STAFF WRITERS Los Angeles Times, April 20, 2001, Friday,, Home Edition, Page 3, 1426 ????words, CALIFORNIA AND THE WEST; ??LEGISLATORS UNITE OVER ENERGY PRICE ISSUE; ????POWER: BIPARTISAN CONGRESSIONAL DELEGATION CALLED TOGETHER BY DAVIS SAYS U. ????S. MUST STEP IN TO PROTECT STATE FROM MANIPULATION BY SUPPLIERS., MITCHELL ????LANDSBERG and MIGUEL BUSTILLO, TIMES STAFF WRITERS The Orange County Register, April 20, 2001, Friday, STATE AND REGIONAL NEWS ????, K497, 846 words, Federal energy commission considers price fix for state ????energy market, By Dena Bunis San Jose Mercury News, April 20, 2001, Friday, STATE AND REGIONAL NEWS, ????K512, 696 words, In response to power woes, rating agencies have California ????on credit watch, By Jennifer Bjorhus San Jose Mercury News, April 20, 2001, Friday, STATE AND REGIONAL NEWS, ????K520, 1069 words, Issues still remain on what power consumers will ????eventually pay, By John Woolfolk and Michael Bazeley The San Francisco Chronicle, APRIL 20, 2001, FRIDAY,, FINAL EDITION, NEWS;, ????Pg. A4, 765 words, Edison pushes lawmakers to accept deal, David Lazarus The Associated Press State & Local Wire, April 20, 2001, Friday, BC cycle, ????7:04 AM Eastern Time, State and Regional, 438 words, Most Edison executives ????going without bonuses, By GARY GENTILE, AP Business Writer, LOS ANGELES The Associated Press State & Local Wire, April 19, 2001, Thursday, BC cycle ????, State and Regional, 901 words, Top political aide discusses Bush's low-key ????style, By RON FOURNIER, AP White House Correspondent, WASHINGTON The Associated Press State & Local Wire, April 19, 2001, Thursday, BC cycle ????, State and Regional, 727 words, Utility commission staff says parent ????company profiting from energy sales, BOISE, Idaho The Associated Press State & Local Wire, April 19, 2001, Thursday, BC cycle ????, State and Regional, 820 words, Legislators probe possible power, natural ????gas collusion, By DON THOMPSON, Associated Press Writer, SACRAMENTO Copyright 2001 Associated Press AP Online April 20, 2001; Friday 7:57 AM, Eastern Time SECTION: Financial pages LENGTH: 238 words HEADLINE: ?Power Co. Executives Lose Bonuses DATELINE: LOS ANGELES BODY: ???Senior executives at Southern California Edison and its parent company went without hundreds of thousands of dollars in bonuses in 2000 because of California's power crisis. ??Edison International's chairman and chief executive, John Bryson, was paid $950,000 in 2000, compared with salary and bonus totaling $2.16 million in 1999. ??Stephen Frank, the chairman and chief executive at Southern California Edison, was paid $617,000 in 2000, compared with salary and bonus totaling $1.3 million in 1999, according to the company's proxy statement filed with the Securities and Exchange Commission. ??The company also said Thursday it would not award merit increases to executives in 2001 because of the continuing crisis. ??In a similar statement released Tuesday, Pacific Gas and Electric Corp. revealed it also withheld bonuses for its top two executives, although they did receive raises. ??Edison and PG&E say they have lost nearly $14 billion since June to high wholesale prices that the state's electricity deregulation law bars them from passing on to consumers. PG&E, saying it hasn't received the help it needs from regulators or state lawmakers, filed for federal bankruptcy protection April 6. ??Edison is continuing to work with state officials and its ??reditors. ?????(PROFILE ?????(CO:Southern California Edison Co.; TS:SCE;) ?????(CO:Pacific Gas and Electric; TS:PCG; IG:ELC;) ?????) LOAD-DATE: April 20, 2001 ??????????????????????????????8 of 78 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service ??????????????????????????????Contra Costa Times ????????????????????????????April 20, 2001, Friday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K560 LENGTH: 460 words HEADLINE: Energy officials accused of manipulating natural gas market defend actions BYLINE: By Andres LaMar BODY: ??SACRAMENTO _ Energy officials who are accused of manipulating California's market for natural gas defended their actions on Thursday and attributed the state's skyrocketing gas prices to increased demand, the weather and other factors. ??The explanation, however, drew skepticism from lawmakers in the wake of expert testimony alleging that one Texas firm, El Paso Natural Gas Co., had engineered a classic case of monopoly power by controlling the pipeline that delivers gas to the state. ??At the outset of the Thursday's hearing, Assemblyman Darrell Steinberg, D-Sacramento, noted the huge run-up in the cost of natural gas, which went from $6.6 billion for the entire year of 1999 to $12.3 billion for sales in 2000 and to $7.9 billion for the first three months of this year. ??Steinberg zeroed in on the difference between California and other parts of the country. From March 2000 to February 2001, natural gas prices have risen 489 percent compared to a 266 percent increase in New Mexico and a 247 percent jump in Chicago. ??Steinberg asked Ralph Eads, the president of an El Paso Natural Gas Co. subsidiary, for an explanation. ??"The 275 percent difference you say is attributable completely to constraints on the pipeline and demand?" Steinberg asked. ??"Yes," Eads replied. Eads said the state's energy crisis, which led power plants to run harder and longer, dramatically increased demand for natural gas over the summer and a winter with temperatures about 15 percent cooler than the year before exacerbated the problem. ??In another twist to California's deregulation nightmare, El Paso officials said they gained greater control of the pipeline after the Pacific Gas & Electric Co. relinquished the capacity four years ago. At that time, PG&E's movement of the gas and the prices it could charge were regulated by the Public Utilities Commission. ??In other developments at the Capitol on Thursday, lawmakers called on the federal government to re- regulate natural gas sales at the California border and U.S. Sen. Joe Lieberman, D-Conn., said federal regulators should impose price caps on California's wholesale electricity market. ??The Assembly held considerable debate on the resolution asking for re-regulation, with Democrats accusing President George W. Bush of doing nothing to come to the aid of California and Republicans defending the administration. ??"I'm learning an interesting lesson that all the problems of the world started after Jan. 21 and the inauguration of the new president," said Assemblyman Bill Leonard, R-San Bernardino. ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??© 2001, Contra Costa Times (Walnut Creek, Calif.). ??Visit the Contra Costa Times on the Web at http://www.cctimes.com/ JOURNAL-CODE: CC LOAD-DATE: April 20, 2001 ??????????????????????????????10 of 78 DOCUMENTS ??????????????????????Copyright 2001 / Los Angeles Times ??????????????????????????????Los Angeles Times ?????????????????????April 20, 2001, Friday, Home Edition SECTION: Part A; Part 1; Page 3; Metro Desk LENGTH: 715 words HEADLINE: CALIFORNIA AND THE WEST; A U-TURN ON CAR TAX REBATES; LEGISLATION: STARTING JULY 1, FEE REDUCTION WILL BE FIGURED DIRECTLY INTO VEHICLE REGISTRATION BILLS, NOT REFUNDED BY MAIL. BYLINE: CARL INGRAM, TIMES STAFF WRITER DATELINE: SACRAMENTO BODY: ??Gov. Gray Davis and the Legislature spun a U-turn Thursday and scrapped a costly program that requires motorists to first pay their car tax and then get a rebate in the mail. ??Starting July 1, the state Department of Motor Vehicles will send owners of approximately 26 million vehicles registration renewal bills already reduced by the amount of the vehicle license fee rebates. ??On a unanimous roll call, the Senate voted final approval and sent to Davis an "urgency" bill, SB 52, that repealed the rebate program, which the governor had previously fought for and defended. ??In addition to abolishing the rebates, the legislation reduces by 67.5% the amount motorists must pay for the upcoming year, the level that lawmakers and former Gov. Pete Wilson envisioned in 1998 when they began cutting the fee. It had been about 2% of a vehicle's market value. ??Davis immediately signed the repeal bill, saying only that the new law will "expedite relief to taxpayers and greatly reduce administrative costs." ??The governor's muted observation contrasted with his effusive support of the rebates last year, when he said Californians "don't appreciate the fact that they're getting a rebate unless they see it in their hands." ??At the time, Davis and the Legislature had the choice of simply cutting the car tax, which voters might not notice, or sending checks in the mail, which Davis felt would have a greater impact. ??The rebates, which began Jan. 1, were scheduled to continue through 2002, when Davis intends to run for reelection. In 2003, the license fee was to have fallen permanently, with no more rebates. ??"The whole rebate scheme was good only through the next gubernatorial election cycle," said Sen. Tom McClintock (R-Thousand Oaks), who supported reductions in the license fee but opposed the rebates. ??Until July 1, the DMV will continue to bill motorists for the full amount of their license fee, which includes a 35% reduction from last year. ??"Then we return to you an additional 32.5% rebate, making a total reduction of 67.5%," said DMV spokesman Bill Branch. Starting with license renewals on July 1, the DMV bills will include the full tax cut. ??A Senate analysis of the repeal bill noted that the current "awkward system . . . effectively requires taxpayers to overpay their vehicle license fee and then await a rebate check from the state--a system that is, at best, difficult to explain." ??But as the California economy tightened, the state's budget surplus shrank and taxpayers shelled out approximately $ 50 million a day to buy electricity, the costs of the rebate program threatened to become a political embarrassment to Davis. ??Projected administrative and postage costs of the rebate program alone were estimated at $ 22 million this year and another $ 22 million or so next year. ??Last year, state Sen. Joe Dunn (D-Santa Ana) and McClintock sought to eliminate the rebates and give drivers their full tax cuts when they register their vehicles. Under pressure from Davis, the bill failed. ??"It was killed behind the scenes at the insistence of the governor," McClintock said Thursday. "He didn't want it on his desk." ??This year, Dunn launched a similar bill, but his name was struck from it as the lead author in the Assembly and the name of Sen. Wes Chesbro (D-Arcata) was substituted. ??In a speech Thursday, Sen. Ross Johnson (R-Irvine) suggested that Davis' performance on the issue in an "earlier time and a more just society" would have resulted in his "public flogging by representatives of taxpayers." ??The repeal bill was passed 78 to 0 by the Assembly on Monday, and sent to Davis by the Senate on a 34-0 vote Thursday. ??If the rebates were to be abolished, the bill had to pass this week in order to take effect July 1, said Branch, the DMV spokesman. This is because motorists must be advised 60 days in advance that their registration renewals are due. ??"We have to reprogram all the computers. We have to print new bills and mail them by May 1 for the July 1 expiration," he said. "It will be a little tight, but we will still make it." ??Branch said that since the Jan. 1 start of rebates, checks totaling $ 454 million have been sent to 7.4 million vehicle owners at an extra administrative cost of $ 9.4 million. LOAD-DATE: April 20, 2001 ??????????????????????????????11 of 78 DOCUMENTS ??????????????????????Copyright 2001 / Los Angeles Times ??????????????????????????????Los Angeles Times ?????????????????????April 20, 2001, Friday, Home Edition SECTION: Part A; Part 1; Page 3; Metro Desk LENGTH: 453 words HEADLINE: CALIFORNIA AND THE WEST; LOCKYER ASKS JUDGE TO ORDER FIRMS TO RELEASE RECORDS BYLINE: ROBERT J. LOPEZ and RICH CONNELL, TIMES STAFF WRITERS BODY: ??California Atty. Gen. Bill Lockyer, ratcheting up his investigation of possible civil and criminal violations by the state's power suppliers, is asking a San Francisco judge to order two firms to hand over confidential records. ??In a motion filed Thursday in Superior Court, Lockyer said Reliant Energy and Mirant Corp. have failed to comply with subpoenas for documents that were to be produced by March 19. ??Amid soaring electricity costs and rolling blackouts, the attorney general launched an investigation of possible manipulation of wholesale electricity prices that have skyrocketed to record levels and have financially crippled the state's major utilities. ??Dozens of other public and private power suppliers are complying with the subpoenas. ??But in an interview, Lockyer accused Reliant and Mirant of stonewalling investigators "so they can keep enjoying these exorbitant profits and prices for as long as possible." ??Ultimately, the companies will have to honor the subpoenas, he said. "I'm going to pit bull them," he said. "This is one we win." ??Both companies say they have done nothing wrong and played by the rules of California's flawed electricity deregulation plan. ??A spokesman for Houston-based Reliant said Thursday the firm is seeking court action of its own to ensure that sensitive business information will not be shared with other public agencies or its competitors. ??Last week, Reliant asked a Los Angeles Superior Court judge to clarify the attorney general's obligation to keep proprietary information confidential. ??"We're glad to cooperate with his investigation to the extent we can," said Reliant spokesman Richard Wheatley. " But we have not received sufficient assurances that Lockyer would keep the data confidential." ??Lockyer called Reliant's court filing "frivolous" and "propagandistic" and insisted that adequate safeguards are in place. He reserves the right under state law to share information with other government agencies aiding in his investigation but has said he will keep sensitive business information from being made public. ??Atlanta-based Mirant demanded and received similar guarantees of confidentiality, Lockyer said. Mirant did not return phones calls Thursday. ??Lockyer did not discuss details of the probe or the kinds of information he's seeking. But based on the investigation so far, he said, "it's beginning to get interesting." ??Other records indicate that the attorney general has sought 91 categories of information about the power merchants' activities. They include the operation of power plants, trading information that may have been shared by private power suppliers and bidding strategies in the California market. LOAD-DATE: April 20, 2001 ??????????????????????????????12 of 78 DOCUMENTS ??????????????????????Copyright 2001 / Los Angeles Times ??????????????????????????????Los Angeles Times ?????????????????????April 20, 2001, Friday, Home Edition SECTION: Part A; Part 1; Page 3; Metro Desk LENGTH: 1426 words HEADLINE: CALIFORNIA AND THE WEST; LEGISLATORS UNITE OVER ENERGY PRICE ISSUE; ?POWER: BIPARTISAN CONGRESSIONAL DELEGATION CALLED TOGETHER BY DAVIS SAYS U. S. MUST STEP IN TO PROTECT STATE FROM MANIPULATION BY SUPPLIERS. BYLINE: MITCHELL LANDSBERG and MIGUEL BUSTILLO, TIMES STAFF WRITERS BODY: ??This may be the surest sign yet of the depth of California's energy crisis: A bipartisan cross-section of the state's congressional delegation, brought together Thursday by Gov. Gray Davis, not only agreed about the severity of the problem but also about the need for swift federal intervention. ??"This meeting did not have the word 'Democrat' or 'Republican' used once," Rep. Darrell E. Issa (R-Vista), said of the unusual spirit of cooperation at the meeting near Los Angeles International airport. ??Members of both parties said the Federal Energy Regulatory Commission must slash wholesale electricity prices so California utilities can once again afford to buy power. Since January, the state government has been buying electricity on their behalf, as skyrocketing wholesale prices put Pacific Gas & Electric Co. and Southern California Edison billions of dollars into debt and many power suppliers refused to sell to them; PG&E has since filed for Chapter 11 bankruptcy protection. ??Although the Bush administration has said repeatedly that it is strongly opposed to price caps, and FERC has refused to grant them, California Republicans at the energy meeting said they are optimistic that the administration will agree to some other form of price regulation. They brushed aside the notion that such regulations might conflict with their ideological belief in a free market. ??"This is not a free-enterprise situation," Rep. Duncan Hunter (R-Alpine) said after the meeting. "In fact, it's just the opposite." ??Specifically citing the huge disparity between natural gas prices charged to California and those charged in other Western states, he said California clearly has been the victim of unreasonably high energy costs. Under federal law, the FERC must regulate the prices of companies if it finds they are exerting "market power" to drive prices to unreasonable levels. ??Executives from two Texas energy companies, meeting with legislators in Sacramento, denied Thursday that they had caused natural gas prices in California to artificially skyrocket by hoarding access to a critical pipeline into the state. ??After the extraordinary meeting in Los Los Angeles, Rep. Brad Sherman (D-Sherman Oaks) said the biggest disagreement between California Democrats and Republicans appeared to be their relative faith--or lack thereof--in the ability of President Bush and his administration to help California. There has been much speculation that Bush, who lost California in November, has no political motive to help the state. ??"We Democrats," said Sherman, "hope very much that our skepticism is proven wrong." ??Davis--who sat flanked by Democratic U.S. Sen. Dianne Feinstein and the governor's newly appointed chief energy advisor, S. David Freeman--said he used the meeting mainly to discuss the importance of conservation by Californians this summer and to ask the congressional delegation to pitch in. Five Republicans and more than a dozen Democrats attended the gathering. ??Feinstein said Thursday that she has asked for a third time to meet with Bush to discuss the energy situation. Meeting with Times reporters and editors Wednesday, she described a recent meeting with Vice President Dick Cheney in which, she said, he "ignored" her appeal for federal assistance. ??Feinstein has been among those critical of natural gas companies, saying they appear to have constricted access to a California-bound pipeline to run up prices. ??The Brattle Group, a respected consulting firm, alleged Wednesday before an Assembly committee that Dynegy Inc. and El Paso Natural Gas Co. had manipulated the market by charging so much for the rights to their pipeline capacity that they had, in effect, withheld access to it. ??That action, the experts said, directly forced companies trying to deliver gas to California to look for alternatives, clogging other pipelines and causing a surge in prices. ??The explanation, El Paso executives said, was simple: Demand for gas soared in California because generators that use gas to make electricity increased production last year in response to the energy crisis. ??"We're not withholding capacity--no one is," said El Paso Merchant Energy President Ralph Eads. "With these prices, you want to sell every molecule." ??In other developments Thursday: ??* The agreement between Davis and Edison International to return its ailing utility arm to financial health is in "deep trouble and could be rejected by legislators," the Standard & Poor's credit rating agency said in a note to clients, citing legislative and other sources. A rejection of the deal "would be a humiliating setback for the governor," S&P said. ??The agreement calls for, among other things, the sale of Edison's transmission grid to the state for $ 2.76 billion and the sale of $ 2 billion in bonds--both designed to pay off the utility's huge electricity debt. Edison agreed to several constraints, including the sale of electricity to the state at prices tied to the cost of producing power. ??Since they returned Monday from a two-week recess, state legislators have been sharply critical of the Edison agreement and have indicated a desire to tinker with aspects of the deal. Some lawmakers have said publicly that a bankruptcy protection filing by Edison, like that of PG&E, might not be such a dire outcome. ??But a senior Edison executive said it is "way too early" to give up on passage of the proposal, which legislators have not yet seen in official form. ??"There is an education process to do here," the executive said of the highly detailed 38-page document. "The legislators should be asking questions. That is appropriate." ??* The Public Utilities Commission voted to investigate whether alternative energy providers violated contractual agreements by withholding supplies from PG&E and Edison, which owe them hundreds of millions of dollars. ??The action, Commissioner Carl W. Wood said, was prompted in part by lawsuits some providers have filed seeking release from their contracts with the cash-starved utilities. The producers of solar, wind and geothermal energy account for more than 25% of California's electricity supply. ??"The question is whether we will be able to rely on them in the long, hot days of summer," Wood said. ??Jack Raudy of the Renewable Energy Creditors Committee said the PUC needs to address the $ 700 million the producers are owed. "All we have gotten is rhetoric from the governor, the PUC and the utilities," he said. ??* An $ 850-million plan to entice Californians to conserve precious megawatts appears to be running into roadblocks, compounding predictions by state officials of tighter than expected energy supplies in May and June. ??Davis signed the conservation spending package last week, earmarking $ 242 million of the new funds for the Public Utilities Commission to distribute to the state's investor-owned utilities to support existing conservation programs. ??But Barbara Hale, director of the PUC's Division of Strategic Planning, said Thursday that since Pacific Gas & Electric Co. filed for bankruptcy protection April 6, the utility has stopped releasing conservation funds. ??Hale, testifying before a state Senate committee, said PG&E's decision--coupled with the threat that Southern California Edison could follow a similar route to U.S. Bankruptcy Court--has complicated her agency's efforts. ??PG&E spokeswoman Staci Homrig said her company plans to petition the Bankruptcy Court to have the conservation funds designated as a trust and separated from assets tied up in the bankruptcy proceedings. She said if the court denies the request, PG&E would ask to be permitted to pay the expenses anyway. The process, she added, could take about a month--too long in the view of some legislators, given increasingly gloomy energy forecasts for late spring and early summer. ??Deputy Director Bob Therkelsen of the California Energy Commission said his agency had been counting on a number of small power producers to bolster their output during that period. But he said some producers did not purchase the necessary equipment because PG&E and Edison have failed to pay them in full for earlier electricity deliveries. ??"It's not a huge amount," he said of the anticipated production shortfall, "but every little bit helps." ??* ??Landsberg reported from Los Angeles, Bustillo from Sacramento. Times staff writers Nancy Rivera Brooks in Los Angeles, Carl Ingram and Julie Tamaki in Sacramento and Tim Reiterman in San Francisco contributed to this story. LOAD-DATE: April 20, 2001 ??????????????????????????????16 of 78 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service ??????????????????????????The Orange County Register ????????????????????????????April 20, 2001, Friday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K497 LENGTH: 846 words HEADLINE: Federal energy commission considers price fix for state energy market BYLINE: By Dena Bunis BODY: ??WASHINGTON _ Californians who see federal re-regulation of the state's crisis-bound energy market as an answer to the impending summer emergency better look for some other solution. ??Even the short-term price fix that the Federal Energy Regulatory Commission may consider at its Wednesday meeting might be too little too late. ??Lobbyists, lawmakers and other FERC-watchers say they have seen a slight shift in recent weeks among commission staff and at least one member. There is some willingness, they say, to consider some price controls, even though the Bush administration is adamantly opposed to such measures. ??Many are looking to see if President Bush's choices for the two vacancies on FERC will provide a margin for change. ??But the commission's basic philosophy that open, unregulated markets are best is not likely to change soon, members say. ??"I've been championing a revamping of FERC's antiquated standards for determining market-based rates," Commissioner Richard Massey said Thursday. But with no success. " My agency is not on the verge of turning on a dime on this market-based pricing." ??The standards are a joke, Massey added, because the commission never turns down requests for such pricing authority. More than 600 power sellers have been given that authority, he said. ??For a power company to be allowed to charge whatever the market will bear, it must show FERC, for example, that it doesn't have the power to manipulate the market and drive prices up. ??"Any seller that can't pass our screen needs to fire their consultants and lawyers," Massey said. ??While the overall philosophy remains consistent, FERC staff has proposed to the commission that a Stage 3 electricity emergency in California should trigger cost-based rates, a form of price controls. Such triggers would be in place for one year, under the staff proposal. ??The commission may decide Wednesday whether to accept that proposal. It has to make some decision by May 1 on how the market will be monitored from now on. ??The theory behind controlling prices in Stage 3, says a FERC staff report, is that during such an emergency generators have the greatest opportunity to manipulate the market and drive prices up. ??But generators have that power during Stage 2 and Stage 1 emergencies, says Les Starck, Southern California Edison Co.'s manager of federal regulatory affairs. Price caps during Stage 3 might avert the rolling blackouts associated with that level of crisis, but they wouldn't do anything to stop generators from jacking up prices the rest of the time, he said. ??It is not clear how long it would take for such price controls to take effect, should the commission go along with the staff recommendation. ??"We're close because summer is approaching," Commissioner Linda Breathitt said Thursday. Breathitt, who had firmly opposed any form of price controls, said in an interview last month that given the worsening crisis in California she was open to considering some short-term measures. ??"It's important to me that we address the summer," Breathitt said, but said she wasn't able to predict what the commission would do Wednesday. ??Even if an order is approved, Massey said, there could be delays while the power sellers file their costs with regulators and disputes over those filings are handled. ??Sen. Dianne Feinstein said Thursday such a move by the commission would be "better than having no controls at all. There's no question that we're going to be in a Stage 3 emergency." ??Feinstein, D-Calif., and other Western lawmakers have been urging FERC to step in sooner and with price controls that extend beyond just the emergency period. ??Waiting for Stage 3 to intervene "is putting the whole grid at risk," said Roger Hamilton, a member of Oregon's Public Utility Commission. "We have a real stability problem when you cut it that close." ??Feinstein says the future could well rest with the new commissioners, particularly Patrick Wood, the head of the Texas PUC who many believe will replace Curt Heber as FERC chairman if he is confirmed by the Senate. ??Even if Massey and Breathitt agree on broader price controls, as chairman, Heber could block consideration of such a move. It's unclear what stance Wood would take as chairman. ??"The thing that deeply concerns me about Pat Wood is that he's from Texas," Feinstein said. "What's reassuring is that it appears from my personal discussion with him is that he appears to be pragmatic." ??But once again, timing could be a problem. ??Bush has said he intends to nominate Wood and Nora Brownell, a member of the Pennsylvania PUC, but has not formally sent their nominations to the Senate. ??"The Federal Energy Regulatory Commission is of vital importance right now, and to let the time go on without filling the spots makes no sense," Feinstein said. "Please please please, President Bush, process your nominees." ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??© 2001, The Orange County Register (Santa Ana, Calif.). ??Visit the Register on the World Wide Web at http://www.ocregister.com/ JOURNAL-CODE: OC LOAD-DATE: April 20, 2001 ??????????????????????????????17 of 78 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service ????????????????????????????San Jose Mercury News ????????????????????????????April 20, 2001, Friday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K512 LENGTH: 696 words HEADLINE: In response to power woes, rating agencies have California on credit watch BYLINE: By Jennifer Bjorhus BODY: ??SAN JOSE, Calif. _ All three of the nation's influential judges of credit risk now have California on credit watch, saying they are deeply concerned about the economic impact of the state's power crisis. ??The Fitch credit rating agency made it unanimous Wednesday when it warned that the thickening electricity quagmire, as well as lower than expected tax revenues in February and March, could spell broader risk for the state's budget. ??The announcement is a signal that Fitch, too, may downgrade its ratings on California's nearly $30 billion in public debt, a move which could cost taxpayers millions. ??The announcement comes as state lawmakers mull a bailout plan for Southern California Edison, Pacific Gas & Electric Co. sits in bankruptcy and state officials bleed through the state's general fund as they purchase expensive electricity for consumers. Earlier this week, Gov. Gray Davis announced that the average daily bill for electricity purchases has risen from $45.8 million a day in the last week of March, to $73 million a day. ??Moody's Investors Service and Standard & Poor's have already issued their own credit warnings, although none of the three agencies has actually downgraded the state's very good double-A credit rating. ??Bond ratings are important yardsticks that bankers and investors use to price municipal and corporate bonds. A downgrade would force California to offer bondbuyers higher interest rates going forward, costing taxpayers. ??The state was last at a lower A rating back in 1994. ??Moody's changed California's Aa2 general obligation bond rating outlook from stable to negative on April 6, the day Pacific Gas & Electric Co. filed for bankruptcy. Standard & Poor's has had the state's AA rating outlook at negative since January, when the state began buying electricity for the utilities. ??The deciding factor for Fitch, said Fitch vice chairman Claire Cohen, was the disagreement over how the money from the new electricity rate hike will be spent. ??The California Public Utilities Commission ruled in late March that money generated by higher electricity bills should go first to pay the state Department of Water Resources, which has been buying electricity for the utilities. Pacific Gas & Electric Co. has argued that if the state is paid first, there won't be any money left for it. ??The utility is formally challenging the PUC decision, and the move threatens to hold up the estimated $12 billion to $14 billion of bonds the Department of Water Resources plans to issue to buy more electricity. ??"With that being appealed you don't have a clean authorization," Cohen said. "It signals to me that it could delay the financing process." ??A second concern is that the state isn't collecting as much in taxes as expected, Cohen said. Tax collections for both February and March were below forecast. The amount of personal income tax the state collected in those months fell short by $455 million, or 14% less than expected. ??Cohen said she made her decision before hearing that the state's power costs now exceed $70 million a day. Cohen and David Hitchcock, the California analyst for Standard & Poors, agreed those rising costs are a definite concern. ??"It doesn't take much of a change in economic growth to make some of these projected fund balances disappear and so we're very worried about what the current economic activity is, particularly in Northern California with some of the problems with the high tech area," Hitchcock told analysts and investors last week in a conference call. ??State treasurer Phillip Angelides was traveling Thursday and couldn't be reached for comment. Other economy-watchers expressed concern. ??Sandy Harrison, assistant director of the state Dept. of Finance, said the move reinforced the importance of solving the current power problems soon. ??"It's important to note that the rating hasn't been lowered yet and does remain very strong," he said. ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??© 2001, San Jose Mercury News (San Jose, Calif.). ??Visit Mercury Center, the World Wide Web site of the Mercury News, at http://www.sjmercury.com/ JOURNAL-CODE: SJ LOAD-DATE: April 20, 2001 ??????????????????????????????18 of 78 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune News Service ???????????????????????Knight Ridder/Tribune News Service ????????????????????????????San Jose Mercury News ????????????????????????????April 20, 2001, Friday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K520 LENGTH: 1069 words HEADLINE: Issues still remain on what power consumers will eventually pay BYLINE: By John Woolfolk and Michael Bazeley BODY: ??SAN JOSE, Calif. _ State regulators last month announced an electric rate increase that would average a whopping three cents per kilowatt hour, hit bills beginning in May and punish power pigs while sparing energy misers. ??Now, much of that is up in the air. ??Higher rates are surely coming _ but not before June. Exactly which consumers and businesses will pay how much is uncertain as regulators rush to forge a rate structure from a tangle of more than 20 proposals. ??Their task has been complicated immeasurably by Gov. Gray Davis' decision to weigh in with a competing rate plan and Pacific Gas & Electric's move into bankruptcy court. ??"Little details are moving billions of dollars around," said Nettie Hoge of consumer advocate group TURN. ??All the proposals assume a "tiered" structure that forces the heaviest users of energy to pay the most. But key details yet to be decided mean consumers could see their average rates go up anywhere from 7 percent to 30 percent or more. ??Among them: ??_How much of an overall increase? The Public Utilities Commission approved a 3-cent per kilowatt hour increase last month, which would boost utility revenue $4.8 million. Gov. Gray Davis' hike _ left vague in Davis' April 5 television address _ averages 2.8 cents for PG&E customers but only 2.3 cents for customers of Southern California Edison. ??_What regions of the state will pay? The commission agreed to raise rates only for Pacific Gas & Electric and Southern California Edison, but Davis would include the additional 1.2 million San Diego Gas & Electric customers. ??_Should heavier users of electricity subsidize those who are exempt from the new rate increase? If so, those users will find themselves paying much more than any of the average increase figures being tossed about. ??_How will utilities bill customers retroactively for the increase? At the time of the PUC vote on March 27, commissioner said their increase would take effect immediately. ??Various plans are being presented this week to an administrative law judge working for the commission. The judge is expected to recommend a rate structure to the PUC on May 4. Public hearings would follow May 7-11, and the commission would vote on a plan May 14, condensing to a few weeks a process that normally lasts nearly a year. ??Each of the major proposals before the commission assumes that residential customers using less than 130 percent of their baseline would be exempt from higher rates. That's mandated under a new law that allows the state to buy power. Customers already pay higher rates for exceeding their baseline, which is the average basic level of use for each region of the state. ??Each major proposal also sets new "tiers" with progressively higher rates for "medium" use at 130 to 200 percent of baseline and "heavy" use over 200 percent of that level. ??But that's where the similarities end. ??The first distinction among the leading plans comes in the form of an assumption: How many residential customers will avoid any increase because they don't exceed 130 percent of their baseline? Davis says more than half, commissioners say a little under half and PG&E says less than a third. ??The second difference among the plans is a real difference: What happens to everyone else? ??Under the plan by utilities commission President Loretta Lynch, medium PG&E users would see average bills rise 9 percent and heavy users would see bills increase 36 percent. ??Davis' plan says medium PG&E users would see average bills rise 11 percent while heavy users would pay 37 percent more. But the average total bill increase for PG&E residential customers, including those who are exempt, would be 20 percent under his plan and 24 percent under Lynch's, according to a statement on the governor's web site. ??Business customers would see proportionately greater increases, averaging 30 percent under Lynch's proposal and 26 percent under Davis'. ??The most consumer-friendly of the various proposals comes from consumer-rights group TURN. They suggest an overall average residential increase of just 7.5 percent. ??TURN's plan assumes utilities cannot charge other customers more to make up for the energy misers shielded from rate increases under state law. ??PG&E disagrees with that interpretation. The utility wants other residential users to make up for any lost revenue from exempted customers through higher rates. Under the utility's plan, residential customers would see an average rate hike of nearly 30 percent. ??"The proposal these folks are pushing rips the heart out of that law," said Matthew Freedman, staff attorney for TURN. ??Another issue affecting consumers is how the utilities can bill for electricity used in April and May, before the final plan is approved. ??Utility officials have objected to making the rate structure retroactive. Instead, to recoup the revenue, they are proposing a flat surcharge that everyone would pay, regardless of how much they use. ??Edison proposes a higher surcharge added to bills for a shorter period of time _ in this case, June through August. PG&E officials are suggesting a smaller surcharge that would be spread out over 12 months. ??"It'll probably be something closer to the PG&E proposal," Paul Clanon, the commission's director of energy issues. ??All the rate increase proposals stem from a commonly understood problem: California's current, frozen rates don't generate enough money to cover the wholesale price of power. The PUC raised rates 10 percent _ or 1 cent per kilowatt hour _ in January in an attempt to help, but that turned out to be far from enough. ??In March, the Commission approved an additional 3-cent increase. But Davis followed quickly with an alternative proposal. The next day, PG&E filed for bankruptcy, raising the specter that a federal judge could order even higher rates. ??Although the PUC has sole authority to raise rates under state law, Davis' proposal has complicated an already complex process. The governor appointed three of the five members of the commission, and his appointees seem inclined to show him deference. But Davis has been slow in filing the details of his plan, which has made it hard for the PUC to proceed. ??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune ??© 2001, San Jose Mercury News (San Jose, Calif.). ??Visit Mercury Center, the World Wide Web site of the Mercury News, at http://www.sjmercury.com/ JOURNAL-CODE: SJ LOAD-DATE: April 20, 2001 ??????????????????????????????19 of 78 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ????????????????????APRIL 20, 2001, FRIDAY, FINAL EDITION SECTION: NEWS; Pg. A4 LENGTH: 765 words HEADLINE: Edison pushes lawmakers to accept deal SOURCE: Chronicle Staff Writer BYLINE: David Lazarus BODY: Although lawmakers are skeptical of the state's multibillion-dollar deal to acquire the power lines of Southern California Edison, the head of the utility's parent company warned yesterday that failure to approve the accord could lead to a "long and costly" bankruptcy. ???But John Bryson, chief executive of Edison International, told The Chronicle that he thought legislators would "want to do the right thing" by approving the multibillion-dollar agreement and preventing Edison from following Pacific Gas and Electric Co. into bankruptcy court. ???Bankruptcy for California's two largest utilities could have severe consequences for consumers. Financial analysts said a worsening of the state's energy mess would increase the possibility of higher electricity rates. ???Nevertheless, lawmakers are unlikely to accept the Edison deal -- at least not in its present form. ???"We are going to go through this thing extensively," said state Senate President Pro Tem John Burton, D-San Francisco. "There are a lot of concerns about the valuation." ???Still, he said, legislative backing for the accord remains possible as long as Edison is open to amending some of the terms. ???"The Edison people are smart enough to know that the Legislature is going to have its say," Burton said. ???Indeed, sources familiar with the matter said Edison expected a certain amount of tinkering with the deal and would not resist efforts to reach common ground with lawmakers. ???"The Assembly members do not view bankruptcy as a favorable alternative," said Assemblyman Herb Wesson, D-Los Angeles. "There will be a big effort to try and work something out." ???Edison's Bryson seems eager at this point to present himself and his company as reasonable business partners who are willing to negotiate in good faith. ???This contrasts sharply with the state's relations with PG&E, which turned acrimonious after PG&E blindsided the governor with its bankruptcy filing. Each side blamed the other for the collapse of earlier negotiations. ???"We made the decision at an early stage that this was a massive problem for the state and that the best course was to find a practical solution that would allow us to get on with operating our power system," Bryson said. ???Bankruptcy, he said, "is absolutely a last resort. It's a long and costly process." ???It is also the last thing Wall Street wants to see. On Wednesday, rating agency Fitch Inc. joined Standard & Poor's and Moody's Investor Service in warning that California's credit rating could be lowered because of the state's energy mess. ???"The state may be forced to issue junk bonds," said Carol Coale, an energy-industry analyst at Prudential Securities in New York. "This could lead to a surcharge on electricity bills to guarantee the bonds." ???Bryson, not surprisingly, defended Edison's agreement with the governor as a prudent alternative to bankruptcy. ???"This is a very good deal for the state," he said. "It is not a bailout. Edison gives up a lot to make all this possible." ???Southern California Edison will sell its power lines to the state for $2.8 billion. It also will provide low-cost power to California for 10 years and drop a federal lawsuit seeking full recovery of nearly $5 billion in past debt. ???Critics say the state is paying far too much for Edison's transmission system -- more than two times book value -- and that the power lines are of little use unless PG&E's grid also can be acquired. ???"It's a multibillion-dollar ratepayer bailout of Edison," said Doug Heller, a spokesman for the Foundation for Taxpayer and Consumer Rights in Santa Monica. "Edison gets off scot-free." ???Under the most likely scenario, lawmakers will seek to reduce the amount paid for Edison's power lines and to increase the role of the California Public Utilities Commission in regulating the utility. ???They also will try to come up with a workable contingency plan for the state if PG&E remains adamant in its refusal to sell off its part of the power grid. ???"The deal on the table is still salvageable," said Michael Shames, executive director of the Utility Consumers' Action Network in San Diego. "But Edison needs to understand that what it got from the governor is only a framework, not set in stone." ???For his part, Bryson signaled that plenty of room existed for give and take on the issue. ???"We're just at the initial stage," he said. "We always have accepted the notion that Edison is a California regulated utility and is subject to the laws of the Public Utilities Commission."E-mail David Lazarus at dlazarus@sfchronicle.com. GRAPHIC: PHOTO, Gov. Gray Davis (left) and John Bryson, chairman of Edison International, announced a transmission line deal on April 9. Bryson said Edison may go into bankruptcy if the deal isn't approved. LOAD-DATE: April 20, 2001 ??????????????????????????????24 of 78 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ???????????????????????April 20, 2001, Friday, BC cycle ?????????????????????????????7:04 AM Eastern Time SECTION: State and Regional LENGTH: 438 words HEADLINE: Most Edison executives going without bonuses BYLINE: By GARY GENTILE, AP Business Writer DATELINE: LOS ANGELES BODY: ??Senior executives at Edison International and its subsidiary, Southern California Edison, went without hundreds of thousands of dollars in bonuses in 2000 because of California's power crisis. ??Edison International's chairman and chief executive, John Bryson, was paid $ 950,000 in 2000, compared with salary and bonus totaling $2.16 million in 1999. ??Stephen Frank, the chairman and chief executive at Southern California Edison, was paid $617,000 in 2000, compared with salary and bonus totaling $1.3 million in 1999, according to the company's proxy statement filed with the Securities and Exchange Commission. ??The company also said Thursday it would not award merit increases to executives in 2001 because of the continuing crisis. ??In a similar proxy statement released Tuesday, Pacific Gas and Electric Corp. revealed it also withheld bonuses for its top two executives, although they did receive raises. ??Edison and PG&E say they've lost nearly $14 billion since June to high wholesale prices that the state's electricity deregulation law bars them from passing on to consumers. PG&E, saying it hasn't received the help it needs from regulators or state lawmakers, filed for federal bankruptcy protection April 6. ??Edison is continuing to work with state officials and its creditors. ??The utility said its board of directors decided to withhold bonuses to all but two key executives because the financial effects of the energy crisis have overshadowed all other aspects of company and individual performance. ??The two executives who did get bonuses earned them for their roles in preserving the viability of the companies during the crisis and for retention purposes, Edison said. ??Ted Craver, senior vice president, chief financial officer and treasurer at Edison International, was paid $375,000 in 2000 and received a $100,000 bonus. His total compensation in 1999 was $652,100. ??Harold Ray, executive vice president at Southern California Edison, received a salary of $390,000 in 2000 and a bonus of $50,000. His cash compensation in 1999 was $818,400. ??PG&E paid Chairman Robert D. Glynn Jr. $945,086 in salary and benefits during 2000, a 58 percent decrease from $2.26 million in the prior year, according to the company's proxy statement. ??Glynn, 57, received a 12.5 percent increase in his base salary but didn't get a bonus. ??Gordon R. Smith, who runs Pacific Gas and Electric, received a 14.5 percent raise in his base salary to $630,000 but didn't receive a bonus. In 1999, Smith's compensation package totaled $1.1 million. LOAD-DATE: April 20, 2001 ??????????????????????????????28 of 78 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ??????????????????????April 19, 2001, Thursday, BC cycle SECTION: State and Regional LENGTH: 901 words HEADLINE: Top political aide discusses Bush's low-key style BYLINE: By RON FOURNIER, AP White House Correspondent DATELINE: WASHINGTON BODY: ??When 24 members of a Navy spy plane crew returned to the United States after 11-days in Chinese custody, President Bush was noticeably absent from their homecoming ceremonies. ??He also kept a low profile as the Senate shrank his tax-cut plan by $400 billion, and had little to say about riots in Cincinnati this month. ??Such is the silent style of the new president, says Bush's top political strategist, Karl Rove. ??"Every administration is marked in contrast to its predecessor. The previous administration felt compelled to dominate the evening news every day and the president said, 'I'm focused on getting the job done,"' Rove said Wednesday in an Associated Press interview. ??Running a low-key presidency sets Bush apart from former President Clinton, but the style has its critics. ??Some lawmakers, including members of his own party, said Bush could have saved more of his $1.6 trillion tax-cut plan if he had personally lobbied more lawmakers. ??Bush issued a statement expressing sympathy with police and protesters in Cincinnati, but ran the risk of looking detached. ??And Rove acknowledged that there was some discussion in the White House about Bush attending the U.S. crew's homecoming to reap the public relations reward for freeing the crew. ??But the president vetoed the idea, according to Rove, who quoted Bush as saying, "I want it to be about them and I don't want to go through the discombobulation that it would require of them and their families for me to show up." ??It is not hard to imagine Clinton commanding center stage during city riots, a budget battle or an international crisis, but Rove said, "We intended to have a smaller profile than the previous administration." ??Bush's "attitude is that he's not going to be measured by whether or not he gets on the evening news but on whether or not he gets progress," Rove said during the 45-minute interview. ??He sat at a polished wood conference table in his West Wing office, his hands folded over a memo he had discretely turned upside down. Newspapers and a Starbucks coffee mug littered his desktop. Framed photos and artwork were propped against a chair, still awaiting hanging on his 89th day in the White House. ??A painting of a Texas landscape decorated one wall, allowing Bush's political strategist of eight years to "go on vacation whenever I'm on the phone." ??Rove is on the telephone a lot these days crafting strategies to pass the White House legislative agenda, maintain GOP control of Congress in 2002 and position the president for a re-election bid in 2004. ??Bush narrowly won the White House without California's 54 electoral votes, and Rove said the president could win re-election without the state "but it's always nicer to carry the Golden State." ??He said the state's electricity shortage will not hurt Bush's chances in 2004, adding that the administration has done "virtually everything" Gov. Gray Davis has requested. ??He suggested that the state caused its own problems by not building enough power plants and failing to follow the lead of other states, such as Bush's Texas, to establish sound energy policies before a crisis struck. ??"This has got a very human dimension to it," Rove said. "It's one thing to talk about power supplies. It's another thing when you talk about how it affects their jobs, how it's affecting their livelihoods, how it's affecting the safety of their communities and the health of their families. This is a tough issue and it ought to be a wake up call for the entire country." ??A White House task force headed by Vice President Dick Cheney is working on recommendations to address both short-term problems of soaring electricity and natural gas prices and longer-term energy supply problems, focusing on producing more domestic oil and gas and building more electric power plants. ??Rove said the administration will soon unveil new conservation measures aimed at helping California ease its shortages. ??He said Bush and his political team are bringing House Republicans from politically competitive states to the White House, where they discuss their districts' needs and, often, gain local media attention. ??Bush also plans to attend fund-raisers for House and Senate campaign committees, helping the party gear up for 2002 midterm elections in which control of Congress is at stake. ??Rove also said: ??-Bush will not seek broad authority to negotiate trade treaties anytime soon, allowing time to make the legislation more attractive to Democrats. "You can only put so much into that pipe, and we've stuffed it," he said of Bush's crowded legislative agenda. The "fast track" authority is key to Bush's plans for a free trade zone stretching from Canada to Chile. That proposal is the focus of the three-day Summit of the Americas beginning Friday in Quebec City. ??-Americans will support Bush's environmental policies despite criticism of his decision to overturn some initiatives of the final days of the Clinton administration. Rove stopped short of accusing Clinton of setting Bush up for political troubles. "I'm not certain I see a conspiracy there. I do think it's interesting" that Clinton waited until the last moment to act. ??-Bush has not wavered since the campaign in his view that states should be able to opt out of minimum wage increases passed by Congress. "We are not all one single labor market," Rove said. GRAPHIC: AP Photo WX109 LOAD-DATE: April 20, 2001 ??????????????????????????????29 of 78 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ??????????????????????April 19, 2001, Thursday, BC cycle SECTION: State and Regional LENGTH: 727 words HEADLINE: Utility commission staff says parent company profiting from energy sales DATELINE: BOISE, Idaho BODY: ??IDACORP made $66 million in profits in the past year by buying electricity on the spot market and reselling it for a higher price to its subsidiary, Idaho Power Co., the staff for state utility regulators contends. ??The Idaho Public Utilities Commission staff said such profits should not come at the expense of Idaho Power ratepayers facing staggering electrical bills. ??In a report to commissioners posted on the agency's Internet site Wednesday, the staff recommended Idaho Power's proposed increases for residential and commercial customers be cut by about half. ??Idaho Power seeks rate increases over the coming year totaling $227.4 million. The regulatory staff recommends a $108.7 million increase. For residential customers, a requested 34-percent hike would be reduced to 16 percent. ??"This is not a final decision," said Jeff Beaman, a spokesman for IDACORP and Idaho Power. "In many cases, the commissioners disagree with the staff." ??The report noted there was nothing illegal about the transactions between Idaho Power and its sister company, Idaho Energy Systems. To change that, the staff urged commissioners to create a mechanism that forces Idaho Power to buy electricity at the same price Idaho Energy Systems pays for it. ??The report said Idaho Energy Systems, an unregulated subsidiary of IDACORP, repeatedly purchased electricity on the wholesale market and then sold it to Idaho Power for a profit. ??Idaho Power officials contend the recommended policy change could financially cripple the company. It already spent $161 million buying power on the open market and cannot recover the money unless the coming year's rate is increased. ??"The failure to recoup these funds could lead to liquidity problems," Beaman said, "and that will hurt not only the company but our customers as well." ??But IDACORP paid all of its salaried staff - including Idaho Power employees - a 15-percent bonus at the end of the last fiscal year because the company had achieved record profits of $139.9 million, 53 percent over the year before. ??Beaman said incentive payments have no impact on the rate request. ??Charging the higher rate between the two subsidiaries was the result of a commission order tying the price that Idaho Energy charges for wholesale electricity to the Mid-Columbia Index. The index has been pegged at unrealistic levels since the energy crisis erupted in California, and fluctuates constantly. ??"We are confident that the transactions were performed within the letter and spirit of the law, and have not been at the expense of ratepayers," Beaman said. ??Commission spokesman Gene Fadness said commissioners cannot comment on a case before them, but their ultimate decision can be appealed to the Idaho Supreme Court. ??The Public Utilities Commission staff also recommended: ??- Deferring $66.1 million of Idaho Power's rate request, without interest, until answers are available about the company's electricity deals. ??- Deferring another $45.8 million of the request until next year, when the commissioners would allow Idaho Power to collect 5-percent interest. That part of the hike was earmarked for wholesale power purchases this year - purchases that the staff believes will be much more expensive next year. ??- Cutting another $10.3 million from the increase request, contending it was an error by Idaho Power's Risk Management Committee that the company planned on passing on to ratepayers. ??- Implementing a low-interest loan program to encourage energy conservation by Idaho Power customers. ??- A two-year phase-in of any rate increase ultimately approved that is substantially over 20 percent. ??- Changing residential rates to a three-tiered system to encourage savings. ??Homeowners would pay 5.52 cents per kilowatt-hour for the first 800 kwh used, 6.12 cents per kwh for use between 800 kwh and 2,000 kwh, and 7.48 cents per kwh for use over 2,000 kwh. The current residential rate of 5.2 cents per kwh. ??The staff report also took Idaho Power to task, saying it was warned of the possibility of spiraling prices and power shortages as far back as 1995. ??But the company contends it did not want to build generating plants during the past decade because with electricity deregulation looming, nobody knew what independent power facilities were being considered. LOAD-DATE: April 20, 2001 ??????????????????????????????30 of 78 DOCUMENTS ???????????????????The Associated Press State & Local Wire The materials in the AP file were compiled by The Associated Press. ?These materials may not be republished without the express written consent of The Associated Press. ??????????????????????April 19, 2001, Thursday, BC cycle SECTION: State and Regional LENGTH: 820 words HEADLINE: Legislators probe possible power, natural gas collusion BYLINE: By DON THOMPSON, Associated Press Writer DATELINE: SACRAMENTO BODY: ??Southern California Edison was charged about $750 million more this year for natural gas because of unchecked free-market forces, an industry consultant testified. ??Paul Carpenter told the Assembly Electricity Oversight Subcommittee on Wednesday the price spikes came after the El Paso Natural Gas Co. contracted first with Dynegy and later with its own marketing affiliate, El Paso Merchant Energy, to control the pipeline capacity. ??Officials with El Paso and other natural gas suppliers are expected to testify Thursday that they did not illegally manipulate the market. ??The California Public Utilities Commission estimated a year ago that overcharges by the companies that control natural gas flow drove up prices by $ 100 million a year to California gas and electricity customers. ??But PUC attorney Harvey Morris said that was before last summer's price spikes, which he blamed on natural gas suppliers using a "monopoly" to "game the system." ??"It's way worse than we could possibly have imagined," Morris said after testifying before the subcommittee. "It's obviously way higher than $100 million." ??Natural gas rates at the California border generally tracked national prices until November, when they spiked as high as 11 times higher than the price of natural gas elsewhere in the nation, Carpenter said. ??"I have never seen gas prices like this anywhere in the world," said Carpenter, who has been studying the energy market for 20 years for Cambridge, Mass.-based consultant The Brattle Group. The Brattle Group was hired by Edison to study the natural gas market. ??The committee is one of two legislative committees exploring whether illegal market manipulation in the electricity and natural gas markets has driven up California's energy costs. ??"This is a market that is plagued by the exercise of market power," Frank Wolak, chairman of the California Independent System Operator's Market Surveillance Committee, told the Senate Select Committee to Investigate Price Manipulation of the Wholesale Energy Market. The ISO runs the state's power grid. ??However, "there is no law against me saying, 'I'm not going to sell to you,"' Wolak said. Market manipulation only becomes illegal when there is collusion, Wolak said, and such evidence is hard to find. ??Electricity generators and natural gas suppliers say a severe supply and demand imbalance - not market manipulation - has led to higher prices. ??"Everybody's busy doing investigations. They're not interested in solving the problem," said Independent Energy Producers Executive Director Jan Smutny-Jones. ??Investigations "are wasting everybody's time," Smutny-Jones said, adding that previous probes and lawsuits have uncovered no wrongdoing. He said the state's power problems came because state regulators denied utilities the chance to sign long-term energy contracts when they had the chance. ??"People have been playing by the rules," Smutny-Jones said. ??But the Senate committee's first witnesses are ISO officials who authored studies that claim the state paid more than $6 billion too much for power last year. ??Committee chair Joseph Dunn, D-Garden Grove, also has sla
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