NEWS: Governor's Press Conference on President Bush's Energy Plan

* from Govt Affairs

< Governor Gray Davis held a well-attended press conference at the Capitol
< today to discuss his reaction to President Bush's energy plan. In reading
< his prepared statements, Davis spoke as if directly to President Bush and
< FERC. Davis later answered questions from reporters.
<
< The Governor began the press conference by saying he commended the
< President for "facing up to America's energy crisis." However, he added,
< "I fault the President for not providing immediate relief for
< California...[which is] in a war with price-gouging energy companies--many
< of them are in Texas." Davis said that the President needs to be "more
< creative" in his solutions to the energy crisis.
<
< Davis also applauded the President's focus on conservation in his energy
< plan. Davis said, "[California has] $850 million worth of incentives for
< individuals and businesses...to adopt energy-saving measures in their
< homes and businesses." He added that California is the number one state
< in per capita energy conservation.
<
< Davis said he had joined with the governors of Oregon and Washington on
< calling for temporary price caps for the Western states. He explained
< that "Texas earlier this year adopted a temporary form of price relief,"
< and asked why California couldn't do the same. Davis also said one of the
< incoming FERC commissioners is the former head of the Texas PUC, "so there
< has to be a way that California can get temporary price relief."
<
< Davis said of President Bush, "by not doing anything, you are allowing the
< price-gouging energy suppliers to get away with murder."
<
< On the subject of FERC's recent ruling on QFs, Davis said, "it appears to
< give California relief...but is another Trojan horse." He explained, "FERC
< refused to order the contracts be broken...but the effect that will be
< caused allowing them to re-sell the power if they're relieved of the
< obligation to provide it to utilities is that Californians will have to
< pay [for QF power] on the spot market." Davis said that FERC was "giving
< with one hand and taking away with the other." He added, "If [FERC]
< can't give us price relief, just go home."
<
< One suggestion Davis gave for FERC being more creative was to "take a much
< more aggressive approach in ordering..massive, 50% refunds to taxpayers."
< Davis added that "this is an idea I've discussed with [Bush FERC nominee]
< Pat Wood of the Energy Commission."
<
< Davis urged the President to work with FERC to help California saying,
< "The President didn't create this problem, but is the only one who can
< instruct his appointees"
<
< He added, "I told the generators face-to-face, your fate is in your
< hands." He added, "I said to them: If you don't work with me this summer,
< I will sign a windfall profits tax!"
<
< In response to a question on the merits of federal preemption vs. States'
< rights and eminent domain for power plants and power lines, Davis
< reponded, "I'm going to duck that question." He added, "here's why: the
< federal government...on the big issues, has been distinctly unhelpful."
< Davis said he was "inclined to say that more federal power" in this matter
< would not help the situation.
<
< In response to a question on the viability of deregulation, Davis said,
< "In fairness, we don't have true deregulation in this state--I am trying
< to make something work that is unworkable." He added, "deregulation is
< not a religion, it's a theory." Davis said, "according to Allen
< Greenspan, deregulation only works if there is 15% supply above demand"
< and this is not the case in California.
<
< Davis criticized the Federal Energy Regulatory Commission and said,
< "Everyone on that commission has forgotten that third word
< "Regulatory"--they found out the prices are unjust and unreasonable and
< did nothing."
<
< In response to a reporter's question on whether Davis believes President
< Bush will come through for California, Davis responded, "I believe the
< President may well in the end do the right thing for Californians...I
< believe he will be creative in his solutions."
<