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Sac Bee, Fri, 7/13: Lawmakers vow a vote on Edison Sac Bee, Fri, 7/13: No outcry to ease clean-air process Sac Bee, Fri, 7/13: State lawmakers lobby for refund on energy purchases Sac Bee, Fri, 7/13: Energy conflicts revealed=20 SD Union, Thurs, 7/12: Judge says California owed 'hundreds of millions of= =20 dollars' =01) not billions SD Union, Thurs, 7/12: Southern California gas fights FERC over routine=20 decision that may cost millions LA Times, Fri, 7/13: Options Debated in Edison Rescue LA Times, Fri, 7/13: Developer Pulls Plug on Power Plant in Chula Vista LA Times, Fri, 7/13: Some State Energy Consultants Own Generators' Stock LA Times, Fri, 7/13: Plan Uses Public in Refund Demand SF Chron, Fri, 7/13: 2 sides face off at EPA hearing on regulating energy= =20 plant emissions=20 SF Chron, Fri, 7/13: 7 California advisers own energy stocks=20 Secretary of state calls for investigation=20 SF Chron, Fri, 7/13: PG&E customers get a payback for conservation=20 Nearly one-third earn rebates for cutting electricity use 20%=20 SF Chron, Fri, 7/13: Judge spells out opposition to power refund claim=20 Opinion says $8.9 billion in alleged overcharges for electricity 'cannot be= =20 substantiated' SF Chron, Fri, 7/13: News briefs on the California power crisis SF Chron, Fri, 7/13: Wholesale prices drop by largest amount in 28 months Mercury News, Fri, 7/13: Power rebate generates shockingly high interest=20 Mercury News, Fri, 7/13: Settlement talks unsuccessful=20 OC Register, Fri, 7/13: Rate hike may hit businesses=20 Wash. Post, Fri, 7/13: Judge Rejects Power Refunds For California=20 WSJ, Fri, 7/13: Mediator Questions California 's Claims To Power Refunds ---------------------------------------------------------------------------= --- ------------------------- Lawmakers vow a vote on Edison=20 By Kevin Yamamura and Emily Bazar Bee Capitol Bureau (Published July 13, 2001)=20 Facing a looming deadline and pressure from the governor, legislative leade= rs=20 said Thursday they will push for a vote next week on a revised plan to save= =20 Southern California Edison from bankruptcy court.=20 Under competing proposals from each house of the state Legislature, large= =20 businesses would pay for the majority of Edison's $3.5 billion debt and pow= er=20 generators would be pressed to accept less than they are owed for past ener= gy=20 purchases.=20 A vote next week would come three months after Gov. Gray Davis first struck= =20 an agreement with Edison. His original arrangement would have the state=20 purchase the company's transmission lines for $2.76 billion and use a porti= on=20 of consumer rates to help pay off Edison's debt.=20 But lawmakers roundly criticized the Democratic governor's agreement in=20 subsequent weeks and floated alternatives soon afterward. Lawmakers=20 acknowledged that the latest alternatives are still under negotiation.=20 The governor's agreement with Edison has an Aug. 15 deadline, which falls= =20 toward the end of the Legislature's summer recess. Because the monthlong=20 break is scheduled to begin next Friday, lawmakers plan to vote before then= .=20 The Assembly could vote on a proposal as early as Saturday.=20 Davis on Tuesday threatened to call a special session to keep legislators i= n=20 Sacramento if they do not approve the Edison plan before the break. But=20 Senate President Pro Tem John Burton, D-San Francisco, challenged that=20 threat, saying, "Only the Legislature can keep the Legislature here."=20 Senate Democrats are studying a plan by Sen. Byron Sher, D-Palo Alto, that= =20 would have large businesses pay off most of Edison's debt and force=20 generators to reduce by 30 percent the amount they are owed by the utility.= =20 That would leave about $1.2 billion in debt, for which Edison itself would = be=20 responsible without relying on ratepayers, Sher said.=20 His plan also gives the state the option to purchase Edison's transmission= =20 lines for book value -- less than half the price Davis offered to pay.=20 Burton said his house will vote on a version of Sher's proposal next week.= =20 Burton said he prefers Sher's version because large businesses and industri= al=20 users, not consumers or small businesses, would be responsible for paying t= he=20 majority of Edison's debt. He reiterated that businesses were among the mos= t=20 ardent advocates for electricity deregulation.=20 "We're trying to do something legislatively that protects the people and=20 isn't a bailout for the utility," Burton said. "I don't think it's fair tha= t=20 small users pay for any of (the debt)."=20 While the Senate toils over Sher's proposals, members of the Assembly are= =20 drafting their own version of a plan. Their version, too, would separate=20 users into large and small categories, according to Paul Hefner, a spokesma= n=20 for Assembly Speaker Robert Hertzberg, D-Sherman Oaks.=20 Under the plan, electricity for small users -- some residential and=20 small-business customers -- would come from the cheapest sources -- Edison'= s=20 own power plants and renewable energy sources known as "qualifying=20 facilities." Larger users would pay more because they would obtain power fr= om=20 the long-term contracts that have been signed by the state Department of=20 Water Resources.=20 Ultimately, as the amount of electricity supplied by the long-term contract= s=20 declines over the course of several years and the overall supply increases,= =20 costs to large businesses are expected to decline as they buy more power on= =20 the open market, presumably at lower prices.=20 The plan envisions a portion of business and residential rates dedicated to= =20 reducing Edison's debt for at least the first year, with businesses picking= =20 up more of the burden in future years. Like the Senate plan, the state woul= d=20 have an option to buy transmission lines.=20 The Bee's Kevin Yamamura can be reached at (916) 326-5542 or=20 kyamamura@sacbee.com <mailto:kyamamura@sacbee.com<.=20 No outcry to ease clean-air process By Chris Bowman Bee Staff Writer (Published July 13, 2001)=20 The Bush administration did not receive much sympathy from California at a= =20 hearing Thursday about its concerns that some environmental rules make it= =20 hard for industry to meet demands for electricity and gasoline.=20 No owners of California power plants testified in Sacramento at the second = of=20 four public hearings examining whether clean air rules unnecessarily impede= d=20 energy production.=20 President Bush ordered the 90-day review by the U.S. Environmental Protecti= on=20 Agency in May as part of his national energy policy.=20 As for California's gasoline producers, a few representatives called for=20 streamlining and clarifying the EPA rules, but not relaxing them.=20 At issue are federal Clean Air Act regulations collectively called "new=20 source review" that apply to businesses looking to build or expand=20 refineries, power plants and other sites that generate air pollution. The= =20 rules call for installation of the best-available pollution-control hardwar= e,=20 plus smog-cutting measures that more than offset the added air emissions.= =20 California's smog officials saw the lack of industry protest Thursday as=20 evidence that rules do not need major fixing.=20 "The system is working," Peter Venturini, a state Air Resources Board=20 official, said at the hearing, which was attended mostly by industry=20 representatives and environmentalists.=20 Venturini said smog-forming emissions from businesses in the state have=20 declined 50 percent the past 20 years despite a 40 percent increase in=20 population and commensurate industry growth.=20 "That tells us we can have a healthy economy and protect our environment," = he=20 said.=20 That balance has been put to the test during the state's energy crisis.=20 Venturini testified to EPA officials Thursday that California's fast-tracke= d=20 system of permitting new power plants within 30 days shows that new-source= =20 rules can be flexed to meet a sudden thirst for more energy.=20 Several industry representatives said the Clinton administration had=20 interpreted the rules in confusing ways that inhibited even routine plant= =20 maintenance and upgrades, some of which improved efficiency and cut emissio= ns=20 of pollutants.=20 Worse, they said, state and local regulators of the rules would impose thei= r=20 own, often conflicting, interpretations of the rules.=20 "A system in which different agencies reach different conclusions from the= =20 same set of facts is no system at all," said Shannon Broome, spokeswoman fo= r=20 the Air Permitting Forum, a national coalition of manufacturers seeking to= =20 streamline the rules.=20 Environmentalists argued the Bush administration was exploiting the=20 California energy crisis to roll back environmental regulations at the=20 expense of public health. They said any relaxation would result in thousand= s=20 of premature deaths of heart and respiratory patients.=20 Priscilla High of the Care for God's Creation Committee of the Roman Cathol= ic=20 Diocese of Sacramento reminded EPA officials that emissions from power plan= ts=20 and automobiles trap the Earth's heat, contributing to climate change that= =20 alters "the natural world as we know it."=20 The Bee's Chris Bowman can be reached at (916) 321-1069 or cbowman@sacbee.c= om=20 <mailto:cbowman@sacbee.com<.=20 State lawmakers lobby for refund on energy purchases By Dale Kasler Bee Staff Writer (Published July 13, 2001)=20 Thwarted in their quest for an $8.9 billion refund from wholesale power=20 suppliers, state officials began applying political pressure Thursday on=20 federal regulators who will set refund levels.=20 A month after pressure from Congress prompted the Federal Energy Regulatory= =20 Commission to accept price controls on electricity, House Democrats from=20 California urged FERC to support Gov. Gray Davis' refund demands.=20 "The congressional delegation is doing all it can," Rep. Sam Farr, head of= =20 the state's Democratic delegation, told reporters during a conference call= =20 with Davis. Farr called $8.9 billion a reasonable refund.=20 Recommending a more lenient standard for calculating refunds, the Democrats= =20 said in a letter that FERC should order refunds for power sales dating back= =20 to May 1, 2000. FERC, however, has ruled previously that it cut off the=20 refund period at Oct. 2.=20 The state says about one-third of the alleged overcharges, or nearly $3=20 billion, took place between May and October.=20 Meanwhile, a FERC administrative law judge reiterated his belief that the= =20 refunds would total "hundreds of millions of dollars, probably more than a= =20 billion dollars," but less than the $8.9 billion California says it was=20 overcharged.=20 Judge Curtis Wagner, who oversaw two weeks of negotiations between Californ= ia=20 and the suppliers, said "the amount claimed by the State of California has= =20 not and cannot be substantiated." In a report to FERC commissioners, he=20 repeated his earlier comment that the state owes more to the suppliers for= =20 unpaid power bills than the suppliers owe the state for overcharges.=20 On Thursday, Wagner formally recommended that FERC hold a public hearing to= =20 calculate the overcharges.=20 In setting the guidelines for figuring out refunds, Wagner said the=20 calculations should be tied to production costs, a guideline urged by=20 California's negotiators. But the judge included a guideline likely to favo= r=20 the sellers: For sales taking place after Jan. 5, 2001, the sellers can add= =20 10 percent to their cost calculations as a risk premium.=20 That was the date Pacific Gas and Electric Co. and Southern California Edis= on=20 were placed on junk bond status by Wall Street credit-rating agencies, maki= ng=20 sellers reluctant to deliver power to the two utilities. The state stepped = in=20 two weeks later to buy power for PG&E and Edison.=20 Davis, speaking to reporters before Wagner's recommendation, said the judge= 's=20 cost formulas would help California prove his case. "The number comes up=20 close to $8.9 billion," he said.=20 But the governor, who has threatened to sue FERC if he didn't get $8.9=20 billion, suggested he'll need political help from Congress to get his way= =20 with FERC.=20 It is widely believed that political pressure made FERC abandon its=20 free-market orientation last month and place price controls on wholesale=20 electricity prices throughout the West. Davis credited "a concerted effort = by=20 Democrats in Congress, accompanied by a few good Republicans," with getting= =20 FERC to change its mind.=20 The Bee's Dale Kasler can be reached at (916) 321-1066 or dkasler@sacbee.co= m=20 <mailto:dkasler@sacbee.com<.=20 Energy conflicts revealed=20 By Amy Chance Bee Political Editor (Published July 13, 2001)=20 Several state energy traders now working to buy electricity on ratepayers'= =20 behalf own stock in at least one energy generator, conflict-of-interest for= ms=20 released Thursday show.=20 Despite Davis administration claims to the contrary, many energy consultant= s=20 who went to work for the state earlier this year didn't file the statements= =20 until Thursday afternoon.=20 Secretary of State Bill Jones, a potential Republican candidate for governo= r,=20 had charged at a Wednesday news conference that the Davis administration ha= d=20 neglected its responsibility to report any potential conflicts.=20 "We're very concerned that these documents were not available for public=20 review throughout the time that energy decisions were being made in the ear= ly=20 stages of this crisis," said Alfie Charles, assistant secretary of state fo= r=20 communications. "It's disturbing that the governor's office lied about the= =20 existence of these documents earlier this week."=20 Charles said the content of the reports is of even greater concern because= =20 they show that a number of the employees hold stock in companies selling=20 power to the state.=20 Gov. Gray Davis' press secretary, Steven Maviglio, said Wednesday that all= =20 consultants required to file the statement had done so or would do so withi= n=20 the required time period. But he acknowledged a day later that most of the= =20 reports had not been filed until Thursday.=20 He said administration lawyers were investigating any possible conflicts.= =20 "If there's anything inappropriate, individuals will be dealt with," he sai= d.=20 One energy trader reported holding stock in Enron Corp. Several "energy=20 schedulers" reported owning stock in Calpine, another power generator,=20 including one who reported holdings valued between $100,001 and $1 million.= =20 Jones said the Democratic governor should have known such financial interes= ts=20 were unacceptable.=20 "Clearly, if you have any type of asset involvement ... you have a potentia= l=20 conflict," he said. "We've spent $43 billion (on electricity) and now we're= =20 sitting here with the people who did the purchasing having a conflict."=20 The Bee's Amy Chance can be reached at (916) 326-5535 or achance@sacbee.com= =20 <mailto:achance@sacbee.com<.=20 Judge says California owed 'hundreds of millions of dollars' =01) not billi= ons =20 \ objattph=20 By Jennifer Coleman ASSOCIATED PRESS July 12, 2001 SACRAMENTO =01) An=20 administrative law judge mediating talks between the state of California an= d=20 energy companies says the state is likely owed "hundreds of millions of=20 dollars" in refunds, much less than the $8.9 billion the state wants. Judg= e=20 Curtis L. Wagner Jr., in a recommendation released Thursday, said that whil= e=20 there are "vast sums" due for overcharges, California utilities, grid=20 managers and the state agency purchasing power owe generators even more. = =20 Gov. Gray Davis and California officials who attended the 15-day talks held= =20 out for $8.9 billion in refunds, but Wagner said that amount "has not and= =20 cannot be substantiated. "That very large refunds are due is clear," Wagne= r=20 wrote, likely amounting to "hundreds of million of dollars, probably more= =20 than a billion dollars in an aggregate sum." Davis said he hoped the Feder= al=20 Energy Regulatory Commission would reject the recommendation. "Californian= s=20 have, by and large, gotten a raw deal from FERC during the past year," he= =20 said in a statement. "Now the day of reckoning for the new FERC has come. I= =20 would like to believe the commission, with two new commissioners, will be= =20 more sensitive to California consumers and order all the refunds that are= =20 due." U.S. Sen. Barbara Boxer, D-Calif., said the recommendation "undermin= es=20 the consumer protections that FERC is supposed to safeguard by law." The= =20 differences between what the state wants and what the sellers believe they= =20 owe should be decided in a "trial-type, evidentiary hearing" that should be= =20 held in 60 days, Wagner said. The judge recommended a method for calculati= ng=20 refunds back to October. California's estimate is based on figures from May= =20 1, 2000. Peter Navarro, a University of California, Irvine economist who= =20 works on energy issues, called the recommendation "insulting" to California= . =20 The refund order should reach back until at least July, he said, when energ= y=20 prices had spiraled to record levels and utilities were accruing billions o= f=20 dollars in debts. "Setting it arbitrarily from October keeps billions and= =20 billions of dollars more in refunds from the state of California," he said.= =20 In calculating costs, the judge recommends using the "heat rate" for the=20 least efficient plant that sold power into the California market on each da= y.=20 That plant's costs to produce power will be the basis for setting a benchma= rk=20 prices that day. Navarro said that's unfair to California and basing refun= ds=20 on each individual plant's costs would be the best way to calculate what wa= s=20 overcharged. "By choosing that methodology, the judge limits the ability o= f=20 California to recover what's really owed to it," Navarro said. "It reduces= =20 the total judgment by as much as 80 percent." Officials with Reliant Energ= y,=20 which participated in the negotiations, were still reviewing the order, but= =20 Melissa Kinch, a company spokeswoman, said they were "hopeful that with the= =20 formula, all the correct data will come out." Wagner said California hasn'= t=20 provided information he requested about the state's long-term contracts.=20 Further compounding the calculations, he said he has yet to receive=20 information from the California Department of Water Resources, the utilitie= s=20 and the Independent System Operator listing amounts they believe they owe t= o=20 generators.=20 Southern California gas fights FERC over routine decision that may cost=20 millions =20 \ objattph=20 By Joe Cantlupe COPLEY NEWS SERVICE July 12, 2001 WASHINGTON =01) A=20 little-noticed decision by federal energy regulators last year is forcing a= =20 San Diego gas company to spend up to $100 million more for its deliveries,= =20 with some of that cost expected to be passed on to consumers. The decision= =20 by the Federal Energy Regulatory Commission (FERC) was already controversia= l=20 because critics contend it favored a Texas natural gas pipeline company now= =20 accused of manipulating California's power markets. As a result, Southern= =20 California Gas =01) a division of Sempra Energy =01) is preparing to fight = the=20 Federal Energy Regulatory Commission in court over control over deliveries = on=20 a key natural gas pipeline. The pipeline in question is an interconnection= =20 known as a "delivery point" at the Colorado River near Topock, Ariz. Despi= te=20 objections from California officials and SoCal Gas, federal regulators last= =20 year cut by nearly two-thirds SoCal Gas's natural gas deliveries from Topoc= k,=20 according to FERC records. Instead, the federal agency allowed other=20 shippers to make most of the remaining deliveries at the Topock connection,= a=20 key pipeline for access into Southern California. The decision forced SoCal= =20 Gas to tap into more expensive natural gas basins in the Southwest, and tak= e=20 other more costly and indirect pipeline routes into San Diego. FERC "has= =20 severely limited the ability of SoCal Gas to use its reserved pipeline=20 capacity to access cheaper gas," said Marcel Hawiger of The Utility Reform= =20 Network, the consumer watchdog group based in San Francisco. SoCal Gas=20 serves 18 million households and small businesses in more than 23,000 squar= e=20 miles of southern and central California. But two-thirds of its service are= a=20 include 1,500 large industrial and electrical generators, such as San Diego= =20 Gas & Electric Co. Natural gas powers most of the electrical generators in= =20 California. SoCal Gas estimated a $50 million to $100 million price tag = =01) at=20 minimum =01) to comply with the regulators' decision. "It's complicated an= d=20 expensive," said Lad Lorenz, director of capacity and operational planning= =20 for Southern California Gas. Lorenz said SoCalGas is evaluating the financi= al=20 fallout and possible impact on consumers. SoCal Gas is preparing to=20 challenge the FERC ruling with the U.S. Court of Appeals in Washington. FE= RC=20 said it was prompted to parcel out deliveries among gas shippers on SoCal= =20 Gas's Topock pipeline connection after receiving complaints about one of th= e=20 nation's largest pipeline companies, El Paso Corp. of Houston. El Paso own= s=20 two of the five major interstate pipelines that export natural gas to=20 California, and it has four major delivery points in the vicinity of Topock= ,=20 where it transfers gas to other systems, including SoCal Gas. Nearly half o= f=20 California's natural gas imports come from the San Juan and Permian basins = in=20 the Southwest. SoCalGas and a number of energy companies said they had bee= n=20 complaining for years that El Paso was "overselling" deliveries to gas=20 shippers on its pipelines, records show. Industry experts compared the El= =20 Paso tactic to an airline overbooking passengers on flights. The result was= =20 chaotic scheduling and skyrocketing expenses for energy companies that=20 reported losing millions of dollars, according to several industry official= s=20 and documents filed with FERC. Trying for solutions, FERC initially=20 attempted to let the gas shipping companies sort out the problems themselve= s.=20 That effort failed, records show. In October, 2000, FERC determined that E= l=20 Paso's actions were "unjust and unreasonable." FERC officials, speaking on= =20 the condition of anonymity, said the agency sought an equitable solution to= =20 the problem by divvying up the delivery capacity to dozens of gas shippers= =20 that had been controlled by SoCal Gas at the Topock delivery point. The=20 regulators also defended their legal position, saying that SoCal Gas did no= t=20 have the authority to control the flow of natural gas at the Topock deliver= y=20 point, despite long-term contracts. FERC commissioners have not commented o= n=20 the case. SoCal Gas officials insist that FERC's solution punished the San= =20 Diego utility, not El Paso Corp. Some industry observers contend that FERC= =20 botched its oversight of El Paso, which is facing unrelated allegations of= =20 market manipulation. "FERC allowed El Paso to divvy up the space at the=20 California border in such a way so as to benefit marketers and shippers, th= e=20 gas middlemen, to the detriment of the utility (SoCal Gas), which has to sh= ip=20 gas to residential customers in Southern California," said Hawiger of the= =20 watchdog group TURN. California public utilities officials had other=20 concerns, saying in documents filed with FERC that the decision made state= =20 consumers "unwitting victims of El Paso's overselling practice." Moreover,= =20 state officials wrote, El Paso has reaped a "significant transfer of wealth= "=20 by its actions. Officials did not provide details. Earlier this year,=20 California officials filed separate, unrelated allegations against El Paso,= =20 charging that the Texas company improperly withheld natural gas from the=20 state to drive up prices. California officials contend El Paso overcharged= =20 consumers by $3.8 billion. El Paso denies the allegations, which are being= =20 reviewed by an administrative law judge. Ultimately, FERC will decide=20 whether El Paso should be disciplined once again.=20 THE ENERGY CRISIS Options Debated in Edison Rescue Energy: Legislature is still sharply split over Davis' plan. Some want to l= et=20 the utility fall into bankruptcy. MIGUEL BUSTILLO and NANCY VOGELS TIMES STAFF WRITER July 13 2001 SACRAMENTO -- A week before its annual summer recess, the California=20 Legislature remains deeply divided over Gov. Gray Davis' plan to rescue=20 Southern California Edison from financial ruin--and a growing number of=20 lawmakers are proposing to let the state's second largest utility fall into= =20 bankruptcy. Convinced that Davis' plan is political suicide, leading Democrats in the= =20 Assembly and Senate on Thursday advanced slimmed-down alternatives to save= =20 Edison. "The fact of the matter is that we just have to act," said Assembly Speaker= =20 Bob Hertzberg (D-Sherman Oaks), who introduced an alternative plan to rescu= e=20 Edison Thursday afternoon and scheduled hearings on it throughout the=20 weekend. At issue are competing priorities with important ramifications.=20 Advocates of the rescue say it is needed to keep the utility solvent and=20 prevent California from descending further into its long-running energy=20 crisis. Critics say it is politically impossible to sell a bailout for the= =20 utility and argue that bankruptcy may be a better solution. In recent days, those critics have appeared to be gaining ground. Lawmakers= =20 conceded Thursday that none of the counterproposals to Davis' bailout plan= =20 appears to have sufficient support to clear both houses--and none has the= =20 blessing of the utility, which contends that only the original Davis versio= n=20 would make it credit-worthy. In fact, some lawmakers and lobbyists working on the Edison deal contend th= e=20 sudden legislative push is a political exercise designed to deflect critici= sm=20 and provide cover in case the company goes under. California is spending billions to buy about a third of the electricity=20 needed to serve the state because its two largest utilities, Edison and=20 Pacific Gas & Electric, are too burdened with debt to do so. That dilemma c= an=20 end only when the utilities are able to resume their role as procurers of= =20 power. PG&E opted to take itself into Bankruptcy Court in April rather than wait f= or=20 a political solution to its financial problem, but Edison reached a sweepin= g=20 deal with Davis later that month. That plan has languished in the Legislatu= re=20 ever since. The agreement calls for California to purchase Edison's power transmission= =20 grid for $2.76 billion. In turn, the company would use the money to retire= =20 some of the $3.5 billion in debt it racked up between May 2000 and January= =20 2001, when it bought billions of dollars' worth of electricity in the=20 wholesale power market but could not recover those costs from customers=20 protected by a state utility rate freeze. As a result of the state assistance, Edison would resume buying electricity= =20 for the 11 million people it serves in January 2003. If the Legislature doe= s=20 not approve the deal, Davis argues, the state will be left in the business = of=20 buying that power for far longer. But angry consumer groups are threatening to derail any rescue deal with an= =20 initiative campaign, calling such proposals massive government bailouts. An= d=20 some leery lawmakers are convinced that Bankruptcy Court would provide a=20 better forum for resolving Edison's unwieldy problem. "Tell me why bankruptcy is any worse than any other proposal," said state= =20 Sen. Mike Machado (D-Linden), echoing a view he said was shared by many of= =20 his colleagues. "PG&E," he added, "seems to be doing quite well." In recent weeks, said state Sen. Ross Johnson (R-Irvine), he has received a= =20 series of letters from constituents with a penny attached--the amount they= =20 said they were willing to contribute to a rescue of Edison. "PG&E declared bankruptcy months ago," Johnson said, "and contrary to=20 prevailing notions, the world did not come to an end." The tentative rescue deal Davis reached with Edison allows the utility to= =20 back out of the agreement if the Legislature does not approve it by Aug.=20 15--a deadline lawmakers will almost certainly miss unless they strike a de= al=20 before they recess. Edison Officials Voice Optimism Edison officials remain optimistic, however, that lawmakers will soon fashi= on=20 an agreement. Davis threatened this week to haul legislators into a special= =20 session on Edison's woes later this month if they fail to forge a compromis= e,=20 a tactic that encouraged representatives of the utility. "We're feeling better about the likelihood of having this be resolved in=20 time," said Edison spokesman Brian Bennett. The Edison deal is among many interrelated facets of Davis' efforts to end= =20 the energy crisis and escape with a working electricity market in Californi= a.=20 As such, it is a complicated proposal. Indeed, even some of the basics are hard to discern. For one thing, the=20 continuing debate in Washington over whether California is owed billions in= =20 refunds for overcharges by power generators makes it difficult for lawmaker= s=20 even to be sure how big Edison's debt truly is. California leaders had hoped a mediator would find common ground between th= e=20 state and energy companies, but those talks broke down earlier this month.= =20 The refund dispute now moves to the Federal Energy Regulatory Commission--a= nd=20 possibly to the courts, where it could take years to resolve. "Now we have to act, not knowing what the outcome of that process will be,"= =20 said Assemblyman Fred Keeley (D-Boulder Creek), one of the legislators=20 working to craft an Edison deal. Then there is the $43 billion in long-term power contracts that Davis signe= d=20 with energy companies this year in hopes of stabilizing supplies for years = to=20 come. Many lawmakers are convinced that those contracts, which are to be paid off= =20 over the next 15 years by utility consumers, will leave less money for the= =20 utilities to regain their financial footing. That would probably force the= =20 state to raise electric rates again in coming months. That, in turn, would make it more politically difficult for lawmakers to=20 approve the Edison deal, which calls for utility ratepayers to retire the= =20 company's $3.5-billion under-collection through a special surcharge on thei= r=20 bills. "One of the major problems is those long-term contracts," said Assemblyman= =20 Keith Richman (R-Northridge), who is leading the GOP's efforts to cut an=20 Edison deal in the Assembly. "These contracts are going to burden the=20 ratepayers for generations, and appear to be a major impediment to a soluti= on=20 with Edison." Moreover, many lawmakers want to ensure as part of the Edison deal that at= =20 least the largest business consumers maintain the right to shop around for= =20 the cheapest power providers--one of the main selling points of California'= s=20 1996 experiment in electricity deregulation. While businesses have been demanding the so-called direct access, lawmakers= =20 and some consumer groups have voiced concern. They say droves of businesses= =20 will flee the utilities for better deals than the governor's long-term=20 contracts provide--leaving residential customers in the lurch. Amid all these obstacles, a team of Senate Democrats has been huddling with= =20 representatives of the Davis administration for the last two days, working = on=20 a new version of the Edison agreement. A draft being discussed Thursday evening would abandon the controversial pl= an=20 to purchase the utility's transmission grid, whose value has been questione= d.=20 Also, it would not give Edison any help in erasing the roughly $1 billion i= t=20 owes power plant owners, leaving the utility to try to get that debt=20 eliminated in the federal fight with the generators. Instead, the new agreement would only help Edison shrink the $2.5 billion i= n=20 debt it owes to banks and smaller, alternative energy producers. Large powe= r=20 customers would bear the burden of the costs. "These guys are going to come up with something," said Senate President Pro= =20 Tempore John Burton (D-San Francisco) of his Senate team. "If Edison doesn'= t=20 like it, they'll have to take a chance" and send the Davis-backed deal up f= or=20 a vote. Rival Proposal Is Unveiled In the Assembly, meanwhile, a team of lawmakers Thursday unveiled a rival= =20 Edison proposal that would also attempt to shield homeowners and smaller=20 businesses from high rates. To do so, it would force industrial consumers to pay the utility's=20 debts--including a portion of the amount owed generators--in exchange for= =20 allowing big consumers the chance to negotiate their own power deals on the= =20 open market. The proposal represents an effort to coax generators into accepting less th= an=20 they are owed by Edison, because it would allow them to quickly receive=20 prompt payment from large power consumers if they agreed to accept only a= =20 fraction of their bills.=20 Copyright 2001, Los Angeles Times <http://www.latimes.com<;=20 THE ENERGY CRISIS Developer Pulls Plug on Power Plant in Chula Vista Electricity: A San Diego company cancels plans to build a controversial=20 facility. City officials, community opponents are 'thrilled.' MITCHELL LANDSBERG TIMES STAFF WRITER July 13 2001 A San Diego company has canceled plans to build a controversial power plant= =20 in Chula Vista, angrily blaming state officials for failing to guarantee th= at=20 the plant would turn a profit. The announcement from Ramco Inc., made public Thursday, is the latest setba= ck=20 to Gov. Gray Davis' campaign to get more electricity on line this summer. B= ut=20 one state official characterized the decision as evidence that California i= s=20 now dealing with power companies from a position of strength, and can affor= d=20 to turn down projects if the price isn't right. "That's the exact position California wants to be in, frankly, where we can= =20 negotiate and, if we need to, walk away from the table," said Oscar Hidalgo= ,=20 a spokesman for the state Department of Water Resources. "So we'll move on = to=20 other, more willing participants." Ramco apparently gave up after failing t= o=20 strike a deal with the department for energy from the proposed plant, which= =20 would have been near a community recreation center and elementary school in= =20 Chula Vista, a city of 173,000 in southwestern San Diego County. The plant would have provided 62 megawatts of "peaking" power, which is=20 primarily intended for use during periods of heaviest electricity use.=20 Sixty-two megawatts is enough to serve about 50,000 homes. The developer's announcement follows the decision of another San Diego=20 company to withdraw plans for a plant in the Baldwin Hills area of Los=20 Angeles, also in the face of community opposition. State officials conceded= =20 earlier this week that several other power plant projects appear to be behi= nd=20 schedule. Chula Vista Opposed Ramco Power Plant The Chula Vista City Council had opposed the Ramco project, which would hav= e=20 been built next to another new power plant in a highly urbanized area that = is=20 a jumble of industry, residences and other uses. The first plant began=20 operating around July 1. City officials had complained that the proposed plant would run initially= =20 without advanced pollution control devices, and, together with other new an= d=20 proposed plants in the area, would have a disproportionate impact on a poor= ,=20 predominantly Latino population. Some community activists opposed the plant= =20 on similar grounds. Despite the opposition, the Energy Commission approved the plant's license = on=20 June 13. The company did not mention community opposition in its letter to the=20 commission, and Ramco officials did not return telephone calls seeking=20 comment Thursday. Opponents reacted with relief that the plans were being= =20 scrapped. "We're thrilled," said Michael Meacham, special operations manager for the= =20 city of Chula Vista. "Regardless of the reason for withdrawal, we're happy= =20 about it." Josie Lopez-Calderon, president of San Diego's Mexican American Business an= d=20 Professional Assn. and a leading opponent of the plant, was similarly=20 pleased, and said the community opposition had led to the company's=20 withdrawal. "I think if it was solely for the reasons they've given, all the other peak= er=20 plants would be pulling out, and I don't see that happening," she said. "So= I=20 think our concerns might have had some effect." Robert Laurie, the state energy commissioner to whom the company's letter w= as=20 addressed, said that he was not sure he understood the company's rationale,= =20 but that it seemed clear that Ramco was unhappy with the Department of Wate= r=20 Resources. Since last winter, when the state's large investor-owned utiliti= es=20 became unable to pay for their own energy purchases, the agency has been=20 buying most of the state's electricity. "To me, it called into question what the policies of DWR were," Laurie said= .=20 "Are they seeking to add power or are they not seeking to add power?" In his letter, Ramco President Richard McCormack wrote that the company had= =20 been optimistic that the department would "provide the credit support" for= =20 the company to supply power to the Independent System Operator, which runs= =20 the statewide electrical transmission grid. "Unfortunately," he said, the= =20 department had "specifically rejected such support." Officials at Cal-ISO and the department said they didn't understand=20 McCormack's comments. Ramco Couldn't Foresee 'a Reasonable Return' The letter also said that Ramco needed to expect "a reasonable return on it= s=20 investment while dealing with a credit-worthy entity in an environment wher= e=20 the sanctity of contract exists. There is simply no evidence that we can se= e,=20 even on the horizon, that would suggest conditions will improve to the poin= t=20 where Ramco could once again consider investing in new power plants in=20 California." Hidalgo, the department spokesman, said the agency still intends to sign=20 contracts with energy providers, and is willing to continue talks with Ramc= o,=20 but can now afford to be pickier than it was earlier this year, when it was= =20 criticized for signing more than $40 billion in long-term contracts at rate= s=20 that some considered exorbitant. Gary Ackerman, a spokesman for the Western Power Trading Forum, an=20 organization of power traders and generators, said he didn't understand why= =20 Ramco's failure to sign a contract with the department would doom the=20 project. After all, he said, the agency is not the only buyer of electricit= y. "You could take market risk and build that plant," he said. Abandoning it= =20 "doesn't make any sense." He said he knew of no other energy generator=20 contemplating a similar pullout. Rob Schlichting, a spokesman for the Energy Commission, noted that Ramco=20 could still build the plant. Under the terms of its license, the plant woul= d=20 have to be completed by Sept. 30.=20 Copyright 2001, Los Angeles Times <http://www.latimes.com<;=20 THE ENERGY CRISIS Some State Energy Consultants Own Generators' Stock Ethics: They negotiate deals and buy electricity from power firms. GOP=20 officials claim credit for forcing the disclosure of potential conflict. ERIC BAILEY TIMES STAFF WRITER July 13 2001 SACRAMENTO -- More than half a dozen consultants hired by the state to=20 purchase electricity and to negotiate long-term power deals own stock in=20 generating companies such as Calpine and Enron that have profited handsomel= y=20 during California's energy crisis. The potential conflict of interest emerged Thursday with the release of=20 financial disclosure statements by consultants who have been hired by the= =20 state since the start of the power crunch. Among those disclosing stock ownership were two key negotiators of long-ter= m=20 energy contracts and two workers hired to purchase electricity from=20 generators, including some of the firms in which they hold an interest.=20 Several other consultants who played key roles in the state's energy effort= s=20 decided not to file financial disclosure statements, citing legal exemption= s=20 under state law. Among those who did not file the financial disclosure statements were a pai= r=20 of executives at two Wall Street firms that stand to make $14 million if th= e=20 state buys California's power grid. Of about 50 consultants hired by the=20 state in the past six months, 27 filed the disclosures. The disclosures follow a firestorm in Sacramento last month over the hiring= =20 by Gov. Gray Davis of two media consultants also employed by Southern=20 California Edison, the troubled utility that is negotiating with the state= =20 over a bailout package. Steve Maviglio, a Davis spokesman, said the governor's legal staff was=20 reviewing the financial disclosure forms for any potential conflicts of=20 interest. "If there's anything inappropriate," Maviglio said, "then we'll deal with i= t." Republicans, however, said the hired workers had revealed overt conflicts= =20 that clearly violated state law. Secretary of State Bill Jones, a Republican running for governor against=20 Davis next year, said the revelations call into question the work performed= =20 by the consultants on high-priced energy contracts that are "going to=20 mortgage our children's future for decades to come." "If you show a conflict, the potential is there for collusion," Jones said.= =20 "I'm not accusing anyone, but that's why you have disclosure." Rob Stutzman, a state GOP spokesman, said he was particularly troubled=20 because the consultants had delayed filing the disclosure forms for months.= =20 Under state law, the forms are supposed to be submitted within 30 days afte= r=20 the consultants go to work for the state. Most of the energy consultants, who could not be reached for comment,=20 reported owning relatively small amounts of stock in energy firms, generall= y=20 less than $10,000. But one of the new workers, William Mead, disclosed that he owned between= =20 $100,000 and$1 million in Calpine, a San Jose-based energy firm. Mead did n= ot=20 report when the stock had been purchased. Only one of the contractors reported selling off stock after coming to work= =20 for the state. Vikram Budhraja, president of Pasadena-based Electric Power Group LLC, on= =20 Jan. 11 purchased between $10,000 and $100,000 in stock of Dynegy, a=20 electricity and natural gas producer. He sold it off on Jan. 29, 10 days=20 after he came to work for the state. Budhraja has been a top negotiator of= =20 the state's long-term energy contracts, which have included a deal conclude= d=20 March 2 with Dynegy. Richard Ferreira, a retired Sacramento Utility District executive hired by= =20 the state to negotiate long-term power contracts, reported the purchase of= =20 between $2,000 and $10,000 of stock in Calpine, a San Jose-based energy fir= m,=20 in August 2000. He also purchased a similar amount of stock in General=20 Electric Co., which produces power plant equipment, in April 2000. Bernard Barretto, an energy trader, reported that he owned an undisclosed= =20 amount of stock in Enron Corp., a big Texas-based energy firm. Elaine Griff= in=20 purchased between $10,000 and $100,000 in Calpine stock on Feb. 1, less tha= n=20 three weeks before she came to work for the state as an energy trader.=20 Constantine Louie, an energy scheduler, reported owning between $10,000 and= =20 $100,000 in Calpine stock. Republicans took credit for forcing the Davis administration to file the=20 reports, a charge the governor's office brushed aside. Jones, the secretary of state, held a news conference Tuesday to complain= =20 about the failure of nearly all the state's energy consultants to file any= =20 sort of financial disclosure forms. The statements were only made available= =20 late in the afternoon Thursday, months after many consultants went to work= =20 for the state. Maviglio, the governor's spokesman, said the delays were explained in part = by=20 negotiations that began in March with the Fair Political Practices=20 Commission, the state's ethics watchdog, to determine if the consultants we= re=20 required to file the forms. He also suggested that Jones' accusations were fueled more by campaign=20 politics than any devotion to constitutional duty. "One needs to question why the secretary of state is using taxpayer money t= o=20 investigate something beyond his jurisdiction," Maviglio said. "That's why = we=20 have an FPPC, to look at these kinds of things."=20 Copyright 2001, Los Angeles Times <http://www.latimes.com<;=20 THE ENERGY CRISIS Plan Uses Public in Refund Demand Legislature: Democrats' proposal to pressure 'greedy' firms is attacked by= =20 GOP as political ploy. CARL INGRAM TIMES STAFF WRITER July 13 2001 SACRAMENTO -- The Democratic-led state Senate intends to fill constituent= =20 mailboxes with a taxpayer-financed appeal urging Californians to demand=20 nearly $9 billion in energy price refunds from "greedy out-of-state power= =20 generators." Senate leader John Burton (D-San Francisco) said the mailers will ask=20 Californians to join the Senate and Gov. Gray Davis in insisting that the= =20 Federal Energy Regulatory Commission order the refunds of alleged overcharg= es. Senate Democrats set the high target despite a federal mediator's ruling=20 against Davis earlier this week. The mediator said California would be=20 entitled to only about $1 billion in generator overcharges, not the $8.9=20 billion that Davis has fought for. Senate officers said the cost of the mai= l=20 campaign will be paid from the budgets of senators, at taxpayer expense, as= =20 part of the Legislature's constituent service mail program. But Republicans attacked the mailer as political propaganda that may violat= e=20 state law and Senate policy barring issuance of "partisan" documents at=20 public expense. Sketchy details of the quietly developed project surfaced on the Senate flo= or=20 Thursday. Staffers who worked on it said it was virtually impossible to=20 calculate the program's cost. But they indicated that if all 26 Democrats agreed to send up to 30,000=20 mailers each to constituents, the postage alone would cost $140,400. If each mass mailing exceeded 30,000 pieces, a higher postage rate would=20 apply, raising the cost, officials said. In the mailer, constituents are asked to return an attached card to their= =20 state senator, urging "full refunds of the outrageous prices charged by the= =20 greedy out-of-state power generators." Cynthia Lavagetto, manager of the Senate mail program, said each member wil= l=20 decide what do do with the returned cards, including simply filing them or= =20 sending them on to FERC. Lavagetto said a prototype mailer was prepared with the help of the Select= =20 Committee on Citizen Participation, a panel that has no chairman or members= ,=20 since it has not been activated this year. But it does maintain an office a= nd=20 has three staffers on the Senate payroll. Burton dismissed the Republican charges of partisanship as baseless. "We do= =20 this all the time on a variety of issues," he said. "We're saying, 'Stop=20 stealing California's money.' " But Sen. Ross Johnson of Irvine, the Senate's senior Republican, denounced= =20 the mailing as clearly partisan. He said it appeared to reflect a developin= g=20 2002 election strategy of Davis and Democrats to blame the FERC and=20 out-of-state generators for California's energy mess. "I seriously question the appropriateness of using taxpayer money to get=20 people to lobby [for the refunds]," Johnson said. Johnson and Sen. Ray Haynes (R-Riverside) suggested that Democrats turn the= ir=20 criticism to municipal utilities, including the Los Angeles Department of= =20 Water and Power. Some utilities charged the state even higher prices last= =20 winter than did private generators. "Why are they not attacking the DWP?" Johnson asked. He noted that S. David Freeman was running the DWP at the time some of its= =20 highest prices were charged to the state, which is buying power for=20 California's financially crippled utilities. Later, Davis hired Freeman as= =20 his top energy price negotiator. "Doesn't David Freeman more properly belong in that same jail cell as the g= uy=20 called Spike than he does in the governor's office?" Johnson asked. "Spike" has become a character in the California energy debate, thanks to= =20 Atty. Gen. Bill Lockyer, who is investigating whether power sellers engaged= =20 in price-gouging and antitrust behavior. In an interview with the Wall Street Journal in May, Lockyer said he would= =20 "love to personally escort [Enron Corp. Chairman Kenneth] Lay to an 8-by-10= =20 cell that he could share with a tattooed dude who says, 'Hi. My name is=20 Spike, honey.' "=20 Copyright 2001, Los Angeles Times <http://www.latimes.com<;=20 2 sides face off at EPA hearing on regulating energy plant emissions=20 Jane Kay, Chronicle Environment Writer <mailto:jkay@sfchronicle.com< Friday, July 13, 2001=20 ,2001 San Francisco Chronicle </chronicle/info/copyright<=20 URL:=20 <http://www.sfgate.com/cgi-bin/article.cgi?file=3D/chronicle/archive/2001/0= 7/13/ MN233685.DTL< Sacramento -- Power plants, refineries and factories need relief from feder= al=20 clean air laws if they are expected to respond to energy needs during a=20 crisis, industry officials told the U.S. Environmental Protection Agency=20 yesterday.=20 California regulators and environmentalists, on the other hand, said the=20 federal policy that requires the best available pollution control equipment= =20 to be installed when a new pollution source comes online is absolutely=20 necessary to protect air quality and health.=20 The Bush administration's National Energy Plan, released in May, recommende= d=20 that the EPA perform a 90-day review of the policy to determine its effects= =20 on investment in new utility and refinery capacity, energy efficiency and= =20 environmental protection.=20 Industry and environmental representatives lined up yesterday at one of fou= r=20 hearings held by the U.S. Environmental Protection Agency across the countr= y=20 to argue over the importance of requiring tough reviews and emission=20 controls.=20 The EPA's existing policy creates a disincentive for energy efficiency and = is=20 overly complex, said Shannon Broome, a lawyer for the Air Permitting Forum.= =20 The trade group includes General Electric, General Motors, Ford Motor Co.,= =20 Exxon Mobil, International Paper and Merck.=20 When a manufacturer wants to add new equipment that would improve the=20 efficiency of the operation but may emit some pollution, Broome said, the E= PA=20 has been requiring a wider plant review that might include installing=20 thousands of dollars of new pollution-control technology.=20 Instead, said Nelson Meeks, a Clorox executive who spoke on behalf of the= =20 National Association of Manufacturers, the EPA should allow companies to ma= ke=20 routine changes in the physical plant without triggering a wider examinatio= n=20 of the plants and their pollution controls.=20 Roland Hwang, senior analyst at Natural Resources Defense Council, disagree= d=20 with any attempt by the Bush administration to solve energy problems by=20 backing off pollution control.=20 "Weakening protections would have a devastating impact on air quality and= =20 public health in California," he said. "Allowing a new power plant to opera= te=20 without the controls -- even running on natural gas -- would create=20 significant emissions of oxides of nitrogen, a precursor of smog that has= =20 been found to cause lung damage."=20 Terry Davis, of Sacramento, described himself as the father of a daughter w= ho=20 has asthma and depends on two inhalators every day. So far this summer,=20 Sacramento has had 26 days of air considered unhealthful to her.=20 Referring to an evaluation paper that the EPA released this week on its own= =20 policy, Davis said, "I'm really worried that the evaluation . . . seems to= =20 put production over health."=20 Speaking for the California Air Resources Board, Peter Venturini, chief of= =20 the stationary source division, said the federal EPA's policy might need so= me=20 tidying up, but it's generally acceptable. California would not like to see= =20 it weakened, he said.=20 "We believe very strongly that the best time to apply controls is when a ne= w=20 facility is constructed or undergoes major modification," Venturini said. H= e=20 said it saves money to incorporate the original technological controls into= =20 the design.=20 California's stricter review process has allowed for approval of 12,000=20 megawatts of new power from 46 plants, including some peaker plants, since= =20 1999, Venturini said. Some have been reviewed within 21 days, a streamlined= =20 period initiated by Gov. Gray Davis last year.=20 E-mail Jane Kay at jkay@sfchronicle.com <mailto:jkay@sfchronicle.com<.=20 ,2001 San Francisco Chronicle </chronicle/info/copyright< Page A - 13=20 7 California advisers own energy stocks=20 Secretary of state calls for investigation=20 Mark Martin, Chronicle Staff Writer <mailto:mmartin@sfchronicle.com< Friday, July 13, 2001=20 ,2001 San Francisco Chronicle </chronicle/info/copyright<=20 URL:=20 <http://www.sfgate.com/cgi-bin/article.cgi?file=3D/chronicle/archive/2001/0= 7/13/ MN98940.DTL< At least seven consultants hired by Gov. Gray Davis to help California buy= =20 and deliver power own stock in power companies doing business with the stat= e,=20 according to financial statements released yesterday.=20 The personal financial statements prompted Secretary of State Bill Jones, a= n=20 announced GOP candidate for governor, to call for an investigation into a= =20 conflict of interest that Jones said could compromise California's position= =20 as an electricity buyer.=20 "It's unbelievable. How does the public know these people are staying at=20 arm's length from their investments?" Jones said.=20 A Davis spokesman said administration lawyers are reviewing the documents a= nd=20 will determine if any of the new employees have a conflict.=20 According to statements filed with the state's Fair Political Practice=20 Commission, six of 45 new consultants hired by Davis own stock in San Jose-= =20 based Calpine Corp., while one has investments in Enron Corp. of Houston.= =20 Both companies are power generators that sell electricity to the state.=20 In January, the state began buying power as the biggest California utilitie= s=20 teetered on financial disaster. Since then, state officials say they've spe= nt=20 more than $8 billion on electricity.=20 Of the seven, two describe their new jobs as energy traders. Traders buy=20 power for the state. Four others list their jobs as schedulers, who receive= =20 invoices from traders and coordinate energy deliveries across the state. Th= e=20 seventh lists his job as consultant.=20 Three of the stockholders said they own between $2,000 and $10,000 in stock= s;=20 two own between $10,000 and $100,000, and one consultant said he owns betwe= en=20 $100,000 and $1 million in Calpine.=20 "We just received the documents today, and our lawyers are going over them,= "=20 said Steve Maviglio, the governor's press secretary.=20 Jones held a press conference Wednesday blasting the Davis administration= =20 because the new hires had not filed statements of economic interest. He sai= d=20 state law requires public officials to fill out the statements within 30 da= ys=20 of beginning a job, and said many of the consultants had worked for the sta= te=20 for months.=20 Davis officials insist the employees have until Monday, but 27 filed their= =20 statements Wednesday or yesterday. The others are not required to fill out= =20 the forms because of their job duties, Maviglio said.=20 The news comes amid charges by Jones and state Controller Kathleen Connell= =20 that two former Clinton-Gore campaign operatives hired by Davis to work on= =20 the power crisis had ties to Southern California Edison. Davis is negotiati= ng=20 with Edison on a bailout for the utility.=20 Connell has refused to pay Mark Fabiani and Chris Lehane for their work as= =20 communications consultants.=20 E-mail Mark Martin at markmartin@sfchronicle.com=20 <mailto:markmartin@sfchronicle.com<.=20 ,2001 San Francisco Chronicle </chronicle/info/copyright< Page A - 12=20 PG&E customers get a payback for conservation=20 Nearly one-third earn rebates for cutting electricity use 20%=20 Joe Garofoli, Chronicle Staff Writer <mailto:jgarofoli@sfchronicle.com< Friday, July 13, 2001=20 ,2001 San Francisco Chronicle </chronicle/info/copyright<=20 URL:=20 <http://www.sfgate.com/cgi-bin/article.cgi?file=3D/chronicle/archive/2001/0= 7/13/ MN186973.DTL< Nearly a third of Pacific Gas & Electric customers who have received this= =20 month's bill got rebates totaling $7.6 million as a reward for slashing=20 electricity use in June, the utility said yesterday.=20 The program that cuts 20 percent off ratepayers' bills if they reduce usage= =20 by 20 percent was a high-profile initiative by Gov. Gray Davis to promote= =20 conservation and decrease dependence on out-of-state generators.=20 So far, PG&E has given credits to 394,000 ratepayers, or 29 percent of thos= e=20 who have received their bills, said utility spokeswoman Staci Homrig.=20 Thousands of additional ratepayers stand to get rebates because the utility= =20 has processed only a third of its billing cycle.=20 The news was giddily received by the Davis administration, which has made= =20 conservation a cornerstone its plan to dig out of California's energy mess.= =20 Administration officials had projected that 10 to 20 percent of customers= =20 would conserve enough to get a rebate.=20 If only 10 percent of customers qualified, Davis estimated that the savings= =20 to the state, which has been buying power on behalf of financially troubled= =20 utilities, would be between $400 million and $1.3 billion. The less power= =20 used means the less power the state has to purchase for the utilities on th= e=20 expensive spot market.=20 'HEROIC EFFORT'=20 "Wow, this is fantastic," said Davis spokesman Roger Salazar. "What this sa= ys=20 is that Californians are taking their conservation seriously. The governor= =20 could not be prouder of their heroic effort so far."=20 About half the rebate amount, $3.7 million, went to 355,000 residential=20 customers, with $3.9 million going to 39,000 agricultural, industrial and= =20 commercial customers. The utility will not have the amount of the average= =20 rebate until later this month, when it completes the billing cycle.=20 To qualify, customers have to reduce their electricity use by 20 percent fo= r=20 any of the four monthly billing periods that end in July, August, September= =20 and October over a comparable period in 2000. Customers can get the rebate= =20 for more than one month.=20 The rebate is labeled "California 20/20 Rebate," and appears on monthly bil= ls=20 right above the line marked, "Total amount due."=20 Whether it be out of fear of dodging 260 hours of rolling blackouts predict= ed=20 for the state this summer or the desire to save cash, the number of rebates= =20 is another signal that Californians are conserving energy -- even if there = is=20 some disagreement on how much.=20 Last month, Davis announced that power usage was down 11 percent in May aft= er=20 being adjusted for growth and weather. In terms of raw, unadjusted data,=20 California's overall electricity consumption in May was down only about 2= =20 percent from the previous year.=20 SWEET REWARD That was little matter to those who received a rebate. For them, it was a= =20 sweet reward for months of bumbling through darkened rooms, watching less T= V=20 and enduring skyrocketing power bills.=20 Those who didn't get the rebate were disappointed. Especially if they have= =20 endured small personal sacrifices in the hope of saving power and cash. For= =20 example, Pierre Chomat, a retired engineering firm manager in Pacific Grove= ,=20 takes only two baths a week as part of his conservation plan. Despite his= =20 bathing cutback -- and replacing incandescent bulbs with fluorescent ones a= nd=20 turning off pilot lights -- Chomat's utility usage went up last month.=20 He blamed his three houseguests for robbing him of the chance at a rebate.= =20 "They were taking baths and doing all sorts of things like that," Chomat=20 said. "And they were here for three weeks."=20 Chomat hopes to get a rebate next month. It may be his last chance for a=20 while; more houseguests are scheduled to arrive in August.=20 For more information about the rebate program, go to www.pge.com/2020=20 <http://www.pge.com/2020<;/=20 ,2001 San Francisco Chronicle </chronicle/info/copyright< Page A - 1=20 Judge spells out opposition to power refund claim=20 Opinion says $8.9 billion in alleged overcharges for electricity 'cannot be= =20 substantiated'=20 Christian Berthelsen, Chronicle Staff Writer=20 <mailto:cberthelsen@sfchronicle.com< Friday, July 13, 2001=20 ,2001 San Francisco Chronicle </chronicle/info/copyright<=20 URL:=20 <http://www.sfgate.com/cgi-bin/article.cgi?file=3D/chronicle/archive/2001/0= 7/13/ MN162115.DTL< In a final written ruling that portrayed California negotiators as obstinat= e=20 and unwilling to compromise, the judge who led talks over electricity price= =20 refunds said yesterday the state's claim of $8.9 billion in overcharges "ha= s=20 not and cannot be substantiated."=20 Three days after negotiations to reach an agreement ended in failure, Curti= s=20 Wagner Jr., the chief administrative law judge of the Federal Energy=20 Regulatory Commission, said any refund to California would have to be much= =20 less than what state representatives sought -- and would not come in cash.= =20 "That very large refunds are due is clear," Wagner wrote in a 12-page opini= on=20 to members of the commission, expanding on remarks he made publicly Monday.= =20 "While the amount of such refunds is not $8.9 billion as claimed by the sta= te=20 of California, they do amount to hundreds of millions of dollars, probably= =20 more than a billion dollars.=20 "However," he went on, "the amount claimed by the state of California has n= ot=20 and cannot be substantiated."=20 Wagner's opinion appeared to paint the California delegates to the 15 days = of=20 talks as unreasonable, unwilling to negotiate and perhaps more motivated to= =20 score political points than resolve the state's yearlong dispute over energ= y=20 prices.=20 "There is an old saying down South that you can take a horse to water but y= ou=20 can't make him drink," Wa
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