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Sac Bee, Thurs, 7/12: Enron files suit in contempt bid Sac Bee, Thurs, 7/12: Davis' refund plan faces a tough road: Several expert= s=20 say it's unlikely the FERC will buy the state's figures Sac Bee, Thurs, 7/12: Energy Digtest: UC, CSU, Enron extend contract Sac Bee, Thurs, 7/12: Energy consultants failed to file disclosures, Jones= =20 says Sac Bee, Thurs, 7/12: Fudging at FERC: Feds must define 'just' energy=20 charges (Editorial) SD Union, Thurs, 7/12: Big customers want to shop around -- and there's the= =20 rub=20 SD Union, Thurs, 7/12: Senate panel, energy firm fighting tough SD Union, Thurs, 7/12: Energy firm scraps plans for plant in Chula Vista=20 SD Union, Thurs, 7/12: Governor tells FERC to be fair and then some SD Union, Thurs, 7/12: Enron Corp. sues to block Senate from forcing docume= nt=20 release SD Union, Thurs, 7/12: Regulators want broad, regional power markets=20 LA Times, Thurs, 7/12: Huntington Loses Battle on Generators LA Times, Thurs, 7/12: Enron Gets 2nd Chance to Turn Over Documents SF Chron, Thurs, 7/12: Coal futures to begin trading but analysts aren't su= re=20 it'll heat up energy markets=20 SF Chron, Thurs, 7/12: Developments in California's energy crisis=20 SF Chron, Thurs, 7/12: Enron files suit over subpoena=20 Provider challenges move for documents SF Chron, Thurs, 7/12: PUC cancels vote to drop voltage levels=20 PG&E tells commission its electric distribution system is already operating= =20 at minimal power SF Chron, Thurs, 7/12: Power regulators hold off on energy-savings plan=20 SF Chron, Thurs, 7/12: Regulators order utilities to form regional systems= =20 Giant step toward national deregulation SF Chron, Thurs, 7/12: Universities, Enron cut deal on electricity=20 Prices 5% below limited rate=20 Mercury News, Thurs, 7/12: Voltage cut won't work, PG&E warns Mercury News, Thurs, 7/12: Energy dispute goes to court=20 Individual.com (AP), Thurs, 7/12: Regulators Look to Develop Markets=20 Chicago Tribune, Thurs, 7/12: For now, electricity crisis has dimmed WSJ, Thurs, 7/12: Regulators Order Formation of Big Grids To Optimize the Flow of Electricity in U.S. ---------------------------------------------------------------------------= --- ---------------------------------------------------------------------------= --- ----- Enron files suit in contempt bid By Emily Bazar Bee Capitol Bureau (Published July 12, 2001)=20 State legislators pressed forward with contempt findings against Enron Corp= .=20 on Wednesday after the company failed to produce subpoenaed documents and= =20 filed a lawsuit asking the court to intervene on its behalf.=20 Lawmakers on a special Senate committee investigating electricity price=20 manipulation warned that the voluminous lawsuit, filed in Sacramento Superi= or=20 Court, could have far-reaching implications for the Legislature's ability t= o=20 conduct investigations and make findings. A few even suggested the legal=20 action could trigger "a constitutional crisis" that could end up in the=20 California or U.S. supreme court.=20 "You are treading into the territory of asking a court to make judgment on= =20 the rules and the law governing the rights of the Legislature," said state= =20 Sen. Steve Peace, D-El Cajon. "It is a separation of powers issue of the=20 highest order."=20 Representatives from Enron, a power marketer based in Houston, said they ar= e=20 merely concerned that the committee has violated their due process rights.= =20 Enron and another company, Mirant, were initially found in contempt by the= =20 committee June 28 for refusing to turn over thousands of pages of documents= =20 that had been subpoenaed June 11.=20 But the committee offered the companies a reprieve. If they complied with t= he=20 subpoenas, signed confidentiality agreements and set up a document deposito= ry=20 in Sacramento by Tuesday, the contempt findings would be expunged.=20 Committee attorney Laurence Drivon reported at the hearing that Mirant had= =20 complied with the requirements, and had set up a document depository in the= =20 U.S. Bank building downtown.=20 Mirant spokesman Patrick Dorinson said 159,000 pages of documents had been= =20 turned over in 44 boxes as of Wednesday morning.=20 As a result, the panel voted to purge the contempt findings against Mirant,= =20 but said it would review the company's compliance again in about 30 days.= =20 Enron, however, did not turn over any documents or sign a confidentiality= =20 agreement since the last hearing, Drivon said, and negotiations yielded=20 little progress. On a 6-0 vote, the panel agreed to move forward with=20 contempt proceedings against Enron.=20 As early as next week, the committee will forward a report to the Senate,= =20 which will vote on the contempt findings and levy punishments that could=20 range from jail time for company officials to steep fines.=20 The panel said Enron could still purge the contempt findings if it complies= =20 with the subpoena before the report is forwarded.=20 But company officials fired back at the committee, accusing members of=20 unfairly singling out Enron and treating it differently from other energy= =20 companies.=20 "It is exceedingly difficult to discern whether the committee's actions are= =20 designed to uncover the facts underlying the price spikes in California's= =20 wholesale electric power market, or to create a convenient political=20 scapegoat to shoulder the blame for California's policy mistakes," one=20 official wrote to the committee.=20 All along, Enron officials have said they have several objections to the=20 committee's process. They believe the panel is violating the Federal Energy= =20 Regulatory Commission's jurisdiction in its investigation; that it isn't=20 entitled to documents that are stored outside California; and that it doesn= 't=20 have the right to the confidential information and trade secrets in the=20 documents.=20 They also argue that their due process rights have been violated because th= ey=20 received no response to their written objections to the subpoena before the= =20 June 28 contempt vote.=20 The committee chairman, Sen. Joe Dunn, D-Santa Ana, overruled most of their= =20 objections Wednesday. However, Enron officials argued it's unfair for a=20 committee member to rule on their objections.=20 "It is a foregone conclusion that the objections are going to be overruled,= "=20 Enron lawyer Michael Kirby said at the hearing.=20 Officials believe an impartial third party should determine the merits of= =20 their concerns, which was a primary reason the company filed the lawsuit,= =20 said Enron spokeswoman Karen Denne.=20 In the lawsuit, Enron seeks a court injunction to end contempt proceedings= =20 until the company's objections "have been duly considered and ruled upon by= =20 an impartial hearing officer."=20 But Dunn said the Legislature's investigations are different from court=20 inquiries, and so are its procedures. "The same due process concerns=20 applicable to a court proceeding are not equally applicable to an=20 investigation by the Legislature," he said.=20 He denied the committee had singled out Enron, and said he believes Enron's= =20 lawsuit is really asking the court to force the Legislature to end its=20 investigation.=20 The committee is scheduled to consider contempt findings against other powe= r=20 companies next week.=20 "Enron (has) raised, potentially, a constitutional crisis with this=20 litigation," Dunn said.=20 Constitutional scholar Clark Kelso said legislators clamoring about a=20 constitutional crisis may be exaggerating. But Kelso, a professor at McGeor= ge=20 School of Law in Sacramento, believes the suit should be dismissed because = it=20 is premature. He said the contempt process is still under way in the Capito= l,=20 and has yet to be acted upon by the Senate.=20 Reacting to Enron's claims that an impartial third party should hear its=20 objections, Kelso also disagreed. "A court is not going to hold a Senate=20 committee to the same standard of impartiality it would hold a judge to," h= e=20 said.=20 The Bee's Emily Bazar can be reached at (916) 326-5540 or ebazar@sacbee.com= =20 <mailto:ebazar@sacbee.com<.=20 Davis' refund plan faces a tough road: Several experts say it's unlikely th= e=20 FERC will buy the state's figures. By Dale Kasler Bee Staff Writer (Published July 12, 2001)=20 Gov. Gray Davis' defiant "see you in court" broadside to federal regulators= =20 this week demonstrates that it's unlikely the regulators will deliver the= =20 multibillion-dollar refund from wholesale power generators that Davis is=20 demanding.=20 Davis' team limped out of Washington empty-handed Monday, concluding two=20 weeks of fruitless refund negotiations with generators. Instead of the $8.9= =20 billion he wanted, Davis got a $716 million offer from generators -- and a= =20 conclusion by the Federal Energy Regulatory Commission judge who oversaw th= e=20 talks that California isn't entitled to anything near $8.9 billion in=20 refunds.=20 Judge Curtis Wagner plans to recommend that FERC hold a full hearing on the= =20 state's refund claims but said he doubts the refunds would amount to more= =20 than $1 billion. That sum is so small that Wagner said the refunds would be= =20 canceled out by the unpaid debts owed to the generators.=20 State officials proclaimed the talks a victory of sorts. The governor's chi= ef=20 negotiator, Michael Kahn, said "our positions were vindicated" because=20 generators for the first time put refund dollars on the table.=20 The governor says generators and marketers, in violation of a federal law= =20 setting a "just and reasonable" limit on wholesale electricity prices, have= =20 routinely overcharged California, plunging the state into a crisis that's= =20 bankrupted Pacific Gas and Electric Co. and could do the same to Southern= =20 California Edison.=20 Insisting they've done nothing wrong, generators and marketers said they=20 offered the refunds simply to put the matter behind them.=20 "It was to get rid of the litigation and investigations -- they're a huge= =20 drag," said Enron Corp. spokesman Mark Palmer. He wouldn't say how much the= =20 Houston-based marketer had offered.=20 Palmer and several experts said the state faces an uphill battle convincing= =20 FERC that California is entitled to the mega-refund Davis wants.=20 FERC, which will make the final call on refunds, probably believes it's=20 helped California already by imposing price controls on wholesale=20 electricity, and may not be inclined to order huge refunds, said Larry=20 Foster, editor of the Washington newsletter Inside FERC.=20 "At some point the commission might say, 'We've done all we can do (for=20 California), and if you don't like it, go to court,' which is what the stat= e=20 is going to do anyway," Foster said.=20 The governor said Tuesday that he will sue FERC if it fails to order $8.9= =20 billion in refunds. "You order what you think is fair," he said. "We'll tak= e=20 what you order, and we'll see you in court."=20 Undaunted by the threat, generators and marketers were chortling over remar= ks=20 by Wagner, who wrapped up the failed settlement talks by saying refunds=20 probably wouldn't top $1 billion.=20 Californians "got hammered" by Wagner, said Enron's Palmer. "The judge told= =20 them, 'Look, your claim is bogus.'"=20 Wagner has retreated somewhat from his statement, telling the San Jose=20 Mercury News that he isn't sure what the final numbers would be.=20 Sources have said that at one point in the talks, he suggested a $4.5 billi= on=20 refund -- including $2 billion in cash and $2 billion in discounts on=20 long-term power contracts. But it wasn't clear how seriously anyone took th= at=20 proposal, and as the talks wound down the judge was clearly dismissive of t= he=20 state's insistence on getting $8.9 billion.=20 Experts say FERC probably will hold the formal hearing and employ a formula= =20 Wagner recommended for calculating the refunds -- a formula that spells goo= d=20 and bad news for both sides.=20 For one thing, Wagner will likely urge a formula based on the price-control= =20 system FERC implemented last month -- something that could work to=20 California's advantage. The controls limit prices to a ceiling based on the= =20 production costs of the least-efficient power generator in California.=20 But Wagner's plan would calculate production costs differently than FERC ha= s=20 so far. He would employ a system that's significantly more favorable to the= =20 generators, said John Stout, senior vice president with power generator=20 Reliant Energy Inc.=20 Also, Wagner would ignore alleged overcharges prior to last October. That= =20 alone could wipe out about $2.9 billion in potential refunds, according to= =20 the Independent System Operator, which runs California's power grid.=20 Suppliers say a full accounting of costs, particularly the skyrocketing=20 natural gas expenses, will show the prices they charged were fair. "The mor= e=20 days of testimony you have, the stronger Wagner's case becomes, the=20 weaker-looking Davis' case becomes," said Enron's Palmer.=20 Nonetheless, California officials said a hearing could produce a refund in= =20 excess of $1 billion.=20 "Any reasonable calculation is going to give you a much higher number than= =20 that," said Severin Borenstein of the University of California Energy=20 Institute.=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 Digtest: UC, CSU, Enron extend contract By Claire Cooper Bee Legal Affairs Writer (Published July 12, 2001)=20 SAN FRANCISCO -- A truce was declared Wednesday in a legal dispute between= =20 California's largest electricity user -- its university systems -- and Enro= n=20 Energy Services.=20 Both sides agreed "in principle" to extend their four-year contract by two= =20 years, until March 2004. They have until Dec. 1 to negotiate a price and=20 other terms.=20 Early this year the Texas-based energy giant, which had been selling=20 discounted power directly to the University of California and California=20 State University, switched more than 24 campuses covered by the contract to= =20 shaky public utilities, subjecting them to potential blackouts and price=20 hikes.=20 A federal judge ruled that Enron probably had violated the contract and=20 ordered the company to resume deliveries. But the 9th U.S. Circuit Court of= =20 Appeals issued a stay and set the case for review.=20 Energy consultants failed to file disclosures, Jones says By Amy Chance Bee Political Editor (Published July 12, 2001)=20 The Davis administration failed to abide by state ethics laws as it hired 4= 5=20 outside consultants to help the state cope with the electricity crisis,=20 Secretary of State Bill Jones charged Wednesday.=20 While such consultants are required to file statements of economic interest= s=20 -- reports of outside income that might represent a financial conflict with= =20 their responsibilities for the state -- Jones said a check by his aides=20 Monday found that none of them had filed the documents.=20 Although the administration began hiring consultants in January, Jones aide= s=20 said they were told that the state Department of Water Resources -- which h= as=20 handled the state's electricity-buying efforts -- only recently became awar= e=20 that the reports were necessary.=20 Jones released a copy of a June 15 memo in which the department notified=20 energy contractors that they were required to file the statement and=20 disqualify themselves from decisions that could affect their financial=20 interests. The memo was written one day after Jones demanded that two of Go= v.=20 Gray Davis' consultants, Chris Lehane and Mark Fabiani, file=20 conflict-of-interest forms.=20 "It's a sad commentary when an administration only decides to comply with= =20 ethics and anti-corruption laws after their violations have been exposed,"= =20 Jones, a Republican who wants to challenge Democrat Davis for governor next= =20 year, said at a Capitol news conference. "I am also deeply concerned that= =20 when filed, the statements of economic interests will show that a number of= =20 consultants have illegally engaged in policy discussions and decisions that= =20 affect their personal finances."=20 Davis press secretary Steven Maviglio said Wednesday that all consultants= =20 required to file the statement had done so or would do so within the requir= ed=20 30-day time period. But he was unable to produce any of the statements,=20 saying they would first have to be reviewed to remove home addresses and=20 other personal information.=20 Information provided by the state Fair Political Practices Commission on it= s=20 Web site states that the forms are public records that state agencies must= =20 make available for "public inspection or reproduction during regular busine= ss=20 hours no later than the second business day after they are received."=20 Jones called on state Attorney General Bill Lockyer to investigate what he= =20 called the administration's "blatant disregard for the state's=20 full-disclosure and conflict-of-interest laws." A Lockyer spokeswoman said= =20 the attorney general would consider the request.=20 Maviglio noted that the statements, which fall under the purview of the FPP= C,=20 are not Jones' responsibility as secretary of state. He said Jones is "on a= =20 witch hunt on something outside his jurisdiction."=20 Jones said if consultants involved in negotiating billions of dollars worth= =20 of contracts with electricity generators had financial conflicts, the publi= c=20 has a right to know.=20 "The governor's insistence on secrecy throughout the energy crisis has=20 prompted increased public cynicism of their government," Jones said.=20 "Unfortunately, it appears that the cynicism is justifiable in this case."= =20 The Bee's Amy Chance can be reached at (916) 326-5535 or achance@sacbee.com= =20 <mailto:achance@sacbee.com<.=20 Fudging at FERC: Feds must define 'just' energy charges (Published July 12, 2001)=20 The economists say that some of the record-high electricity prices that hav= e=20 plagued California in the past 14 months are the result of generators and= =20 traders exploiting flaws in a dysfunctional market to exert market power ov= er=20 prices. The problem is that federal regulators have been slow to wake up to= =20 reality and exert some power of their own to enforce the law.=20 The Federal Power Act is supposed to protect the public by keeping prices f= or=20 electricity "just" and "reasonable." With price limitations now in place=20 going into the future, the Federal Energy Regulatory Commission has done on= ly=20 half of its job. Now it must do the other half by reviewing and remedying t= he=20 abuses of the past.=20 Gov. Gray Davis estimates that generators have overcharged California to th= e=20 tune of about $9 billion. Generators and traders, on the other hand, have= =20 suggested refunding something less than $1 billion. Efforts at a settlement= =20 have gone nowhere. So now FERC must settle the score, even if it means a=20 trial-like proceeding that puts the last year under a microscope, one=20 questionable transaction at a time.=20 While much of the political focus has been on price, the job of the=20 regulators is to consider both price and circumstance. An unjust transactio= n=20 is born out of broken market conditions, when the buyer has little choice b= ut=20 to accept the price of seller who can move the market by his own actions.= =20 When the price exceeds by many multiples the actual cost to produce power,= =20 there is compelling reason to look for gouging.=20 Undoubtedly, there were times over the last year when generators and trader= s=20 weren't gouging California, as evidenced by records of some transaction=20 recently released by the state. During the winter when the price of natural= =20 gas (the state's primary fuel for electricity) was high, there's a reasonab= le=20 explanation for high power prices. Yet last fall and last summer, when=20 natural gas was cheaper yet electricity was outrageously expensive, there's= =20 reason to doubt that the market was working reasonably.=20 Reviewing the prices charged in the last year is a test case for FERC, one= =20 that it has sought to avoid. It requires FERC to concede that it was not on= =20 alert as California ventured into the uncharted world of deregulation.=20 Yet the future of electricity competition in California, and perhaps the=20 nation, depends on the federal government showing that it is able and willi= ng=20 to do its duty to protect the public from unfair market conditions. Settlin= g=20 this score also affects the math of potential deals to put Pacific Gas and= =20 Electric and Southern California Edison back on their feet. The refund that= =20 Californians are owed is likely somewhere between those $1 billion and $9= =20 billion estimates. It's time for FERC to go find out the right amount.=20 Big customers want to shop around -- and there's the rub =20 \ objattph=20 State energy contracts must be paid off by users in system By Ed Mendel =20 UNION-TRIBUNE STAFF WRITER July 12, 2001 SACRAMENTO -- California=20 businesses are being hit by big electricity rate increases, some as high as= =20 100 percent, and they would like to be able to shop around for cheaper=20 power. But state regulators are poised to ban customer choice, or "direct= =20 access" as it has come to be called, because they want to make sure that=20 enough customers remain with utilities to pay for state power purchases. = =20 After a month of closed-door talks, the revelation that the state has signe= d=20 $43 billion worth of long-term power contracts at above-market prices helpe= d=20 scuttle an attempt to work out a compromise in the Assembly.=20 "If the intent of the big customers is to leave the small customers paying= =20 for those contracts, we are going to fight like hell," said Lenny Goldberg,= a=20 lobbyist for The Utility Reform Network.=20 Jack Stewart, president of the California Manufacturers and Technology=20 Association, said large business users were offering to pay off the back de= bt=20 of Southern California Edison, estimated at $3.5 billion, in exchange for= =20 direct access.=20 "I thought we were making a lot of progress until the information on the=20 contracts came out," Stewart said. "We really don't have a way of dealing= =20 with those contracts."=20 Now Stewart is suggesting that direct access be slowly phased in over a=20 period of years and that the long-term power contracts be renegotiated,=20 perhaps with some being switched from the state to big-business users.=20 The manufacturers association and the California Chamber of Commerce helped= =20 organize a business coalition, Californians for Energy Action, that wants a= =20 cheaper alternative to power purchased for utility customers by the state.= =20 "Many large and small California businesses have seen their electric bills= =20 double," says a newspaper ad being run by the coalition this week. "These= =20 cost increases are a burden that will cause consumer prices to increase, so= me=20 businesses to fail and jobs to be lost."=20 A rate increase approved by the state Public Utilities Commission for PG&E= =20 and Edison customers in May fell heaviest on business users. The PUC said= =20 that the average residential increase was about 50 percent, while the avera= ge=20 business increase was about 75 percent.=20 Legislation that authorized the state to begin buying power in January for= =20 the utilities, who were crippled by a failed deregulation plan, bars rate= =20 increases for residential customers who use up to 130 percent of the=20 baseline, the minimal amount deemed necessary for a household.=20 Senate President Pro Tempore John Burton, D-San Francisco, and other=20 legislators have argued that large businesses should bear most of the burde= n=20 of the failed deregulation plan because it was business, not residential=20 consumers, who pushed for deregulation.=20 Alan Zaremberg, president of the California Chamber of Commerce, said that= =20 forcing businesses to bear a "disproportionate" rate increase will cost=20 everyone through higher prices for goods and services and possibly a loss o= f=20 jobs.=20 "If government didn't allow implementation of deregulation in the right=20 manner," Zaremberg said, "then we all have to find a solution. We are all i= n=20 this together, and that's residential and business alike."=20 The legislation that authorized the state to buy power also directed the PU= C=20 to ban direct access power purchases, if the loss of rate revenue from the= =20 departing customers would harm the ability to pay off a power bond.=20 The state plans to issue a bond of up to $13.4 billion in September or=20 October to repay the taxpayer-supported state general fund for power=20 purchases. The bond would be paid off by ratepayers over 15 years.=20 Last week, the Senate rejected a bill by Sen. Debra Bowen, D-Marina del Rey= ,=20 on a 19-12 vote that would have allowed businesses to shop for power if the= y=20 paid an "exit fee" to protect the bond payments. Business groups said the f= ee=20 was too large and would not result in lower power costs.=20 "I cannot carry a direct-access bill that makes it harder to sell the bonds= =20 or that shifts costs from large users, who leave for cheaper power, to=20 smaller users and residential ratepayers," Bowen said.=20 Burton and Bowen have both criticized Gov. Gray Davis' plan to keep Souther= n=20 California Edison from joining Pacific Gas and Electric in bankruptcy. They= =20 say the plan, which includes the state purchase of the Edison transmission= =20 system, is too generous to Edison.=20 Both Burton and Bowen have suggested that an Edison bankruptcy may not be a= =20 calamity. But in the Assembly, Speaker Robert Hertzberg, D-Van Nuys, launch= ed=20 a drive for an alternative Edison rescue plan that was based on gaining=20 business support by offering direct access.=20 Hertzberg asked a former Democratic assemblyman, Phil Isenberg of Sacrament= o,=20 to try to work out an agreement among the various special interest groups:= =20 business, labor, consumers and generators.=20 The basic plan considered by the Isenberg group would have left "core"=20 customers -- residences and small businesses -- in a regulated system=20 receiving power at stable prices from the generators and contracts retained= =20 by the utilities.=20 Businesses and other large users, the "non-core" customers, would be free t= o=20 shop around for low-cost power by 2003 if they agreed to help pay off the= =20 Edison debt.=20 The Edison rate increase for large users would be limited to 50 percent. Th= e=20 PUC would create a "balancing account" to track costs, issuing a refund if= =20 too much was collected or raising rates if revenue fell short.=20 Business and generator groups told Hertzberg last week that they reached=20 agreement on a general framework, with the exception of the state purchase = of=20 the Edison transmission system and some other issues. But the consumer and= =20 labor representatives opposed the framework.=20 Mike Florio of The Utility Reform Network said in a dissenting statement th= at=20 an across-the-board allocation of state power costs would be "clearly unfai= r"=20 and cause residential users to subsidize direct-access customers.=20 Hertzberg said he is considering some of the ideas in the framework present= ed=20 by the Isenberg group and may make a proposal in a week or two.=20 "We are looking at all the possibilities," Hertzberg said. "We are trying t= o=20 do some form of direct access within the current contract structure."=20 Senate panel, energy firm fighting tough =20 \ objattph=20 By Bill Ainsworth UNION-TRIBUNE STAFF WRITER July 12, 2001 SACRAMENTO --= A=20 Senate panel moved a step toward holding Enron, an energy trading firm, in= =20 contempt for refusing to turn over documents senators hope can shed light o= n=20 the state's soaring energy prices. Enron fired back by filing a lawsuit=20 yesterday asserting that only the federal government has the authority to= =20 investigate the power market. The panel, which had previously reached=20 agreements with all the other major generators and marketing companies in= =20 California, voted 6-0 to prepare a contempt recommendation for the Senate t= o=20 consider next week. The Senate, which last issued a contempt citation in= =20 1929, must approve any contempt recommendation. It then has wide-ranging=20 powers to impose fines or jail time. The chairman of the Senate committee,= =20 state Sen. Joe Dunn, D-Laguna Nigel, said that if Enron agrees to turn over= =20 documents to the committee soon, then he will recommend that contempt=20 proceedings be dropped. The Senate Select Committee to Investigate Market= =20 Manipulation also decided yesterday to drop contempt proceedings against=20 Mirant, an Atlanta-based marketing company, because it had agreed to turn= =20 over documents. The dispute also touched on broader issues. Enron, the=20 politically connected Houston-based marketing company, has been pushing=20 electricity deregulation throughout the world. Company chairman Kenneth Lay= =20 is a friend and campaign contributor to President Bush. Last month the fir= m=20 helped sponsor a congressional fund-raiser featuring the president, where= =20 contributors in tuxedos and gowns dined and drank around a giant gold "W"= =20 that reached to the rafters at the Washington Convention Center ballroom. = =20 Enron has also helped shape Bush's energy plan. It is one of several major= =20 donors accused of meeting secretly with Vice President Dick Cheney to draft= =20 the plan. Several senators on the panel disputed Enron's claim that only= =20 federal regulators, and not the state government, could investigate the=20 electricity market. Further, they blasted the company for saying that=20 California could not have access to documents stored outside the state at t= he=20 firm's Houston headquarters. State Sen. Steve Peace, D-El Cajon, said the= =20 company was so defiant that it looked suspicious. "Your client doth protes= t=20 too much," he said to Enron's attorney, Michael Kirby. "One can only wonder= :=20 What do you have to hide?" But Kirby said the company merely wanted to=20 protect confidential information and get answers to its objections. That, h= e=20 said, is why it filed a lawsuit contesting the committee's power to seek=20 documents that Enron claimed would reveal trade secrets. "We want it to ma= ke=20 a ruling and give us our day in court," he said. Peace, however, took issu= e=20 with the lawsuit, calling it a dramatic escalation in the dispute over an= =20 energy crisis that has cost the state billions. "You just declared war on= =20 this state's political system," he said.=20 Energy firm scraps plans for plant in Chula Vista =20 \ objattph=20 Ramco says price limits would make it unprofitable By Kristen Green =20 UNION-TRIBUNE STAFF WRITER July 12, 2001 CHULA VISTA -- Controversial pla= ns=20 to build a power plant by Sept. 30 have been dropped, much to the liking of= =20 city officials. Ramco Inc. pulled out of the project yesterday, saying tha= t=20 the Federal Energy Regulatory Commission's month-old price limits would=20 prevent it from making money. "We are pleased, whatever the reason," said= =20 Michael Meacham, Chula Vista's conservation coordinator. The city opposed= =20 construction of the 62.4 megawatt plant on Main Street, and had asked the= =20 state to reconsider its June 13 decision. The plant was approved under the= =20 governor's 21-day emergency procedure for siting what are known as peaker= =20 plants, those that can be used when energy supplies dip dangerously low. T= he=20 proposal was exempt from the California Environmental Quality Act, and city= =20 officials maintained that allowing the plant to be constructed -- the fifth= =20 of its kind in the Otay region -- would be an environmental injustice. Cit= y=20 officials have been planning an appeal to the state Supreme Court, an actio= n=20 that appeared to be their last recourse. "Our council felt we were doing= =20 what was necessary to protect the public health and safety," Meacham said. = =20 Meacham said yesterday the council would still file the appeal because Ramc= o=20 officials could change their mind. They have permission to build the plant = as=20 long as they are able to complete construction by Sept. 30. Despite the=20 city's pleas, Ramco had, until now, moved forward with its plans. But Ramc= o=20 consultant Dale Mesple said company officials recently had a change of hear= t.=20 They are worried that the California Independent System Operator won't pay= =20 them and that FERC's price limits, which established formulas for maximum= =20 prices during emergency and non-emergency periods, won't allow them to turn= a=20 profit. "There's no reason to run the plant, and no reason to build it,"= =20 Mesple said. The California Energy Commission received a letter from Ramco= =20 yesterday announcing the San Diego company's decision not to build the plan= t.=20 Spokesman Rob Schlichting said Ramco is the first company to pull out of=20 plans to build a plant under the fast-track system. Nine other peaker plan= t=20 projects are still on track, including two Ramco is building in Escondido a= nd=20 one in another Chula Vista location. A tenth peaker-plant, a 49.5-megawatt= =20 facility in Otay Mesa, was approved yesterday. "The loss of this one peake= r=20 plant is not going to be catastrophic," Schlichting said. "It's not going t= o=20 jeopardize the California grid or anything, but I'm surprised a company wou= ld=20 feel this way."=20 Governor tells FERC to be fair and then some =20 \ objattph=20 Davis firm on demand for $8.9 billion refund By Ed Mendel UNION-TRIBUNE=20 STAFF WRITER July 11, 2001 SACRAMENTO -- Gov. Gray Davis had a tough=20 message for federal regulators yesterday after the failure of settlement=20 talks in California's bid to get an $8.9 billion refund from electricity=20 suppliers: "See you in court." The governor said California will seek a fu= ll=20 $8.9 billion refund for electricity overcharges, even if federal regulators= =20 award the maximum refund of $5.4 billion allowed under their guidelines. = =20 "Our message is just order what you are going to order," Davis said of the= =20 Federal Energy Regulatory Commission. "We believe you should order $8.9=20 billion. But you order what you think is fair. We will take what you order,= =20 then we will see you in court." Davis, joined by his negotiating team, mad= e=20 the remarks at a news conference a day after two weeks of closed-door talks= =20 with suppliers in Washington failed to reach an agreement. An administrati= ve=20 law judge made a recommendation to the regulatory commission that Davis' to= p=20 negotiator, Michael Kahn, chairman of the California Independent System=20 Operator, expects to result in a refund of more than $1 billion. Davis sai= d=20 that a revealing decision will be made by the commission, which he hopes ha= s=20 embarked on a "new path" with the appointment by President Bush of two new= =20 members, Pat Wood of Texas and Nora Brownell of Pennsylvania. "Are they on= =20 the side of consumers, as the federal power act envisions them being," Davi= s=20 asked, "or are they just there to do the industry's bidding, as they have s= o=20 often in the past?" Kahn said rules adopted by FERC cut off the refund=20 period at last October, trimming $3 billion from the $8.9 billion overcharg= e=20 claimed by California dating to May 2000. He said FERC has no jurisdiction= =20 over municipal utilities, such as the Los Angeles Department of Water and= =20 Power, that sold power to the state. The municipal districts overcharged th= e=20 state by about $600 million, according to Kahn. As a result, he said, the= =20 maximum refund that FERC could order for California is about $5.4 billion. = =20 "We made it clear to everyone that if we did not settle for $8.9 billion, w= e=20 would seek redress in court for the remainder of the money above $5.4=20 billion," Kahn said. Calpine of San Jose and several other generators have= =20 expressed interest in the state's offer to negotiate one-on-one with the=20 state while the federal regulators consider their decision, Kahn said.=20 Enron Corp. sues to block Senate from forcing document release =20 \ objattph=20 By Jennifer Coleman ASSOCIATED PRESS July 11, 2001 SACRAMENTO =01) A Sena= te=20 committee investigating possible price gouging in California's energy marke= t=20 voted Wednesday to ask the full Senate to find Texas-based Enron Corp. in= =20 contempt for failing to comply with a subpoena for documents. Just hours= =20 earlier, Enron sued the Senate Select Committee to Investigate Market=20 Manipulation to stop the subpoena of its financial and electricity trading= =20 records. Enron attorney Michael Kirby said the company is prepared to turn= =20 over 25,000 documents that were already in California, but that other=20 documents the committee wants are in Texas and out of the panel's reach. = =20 Kirby filed 17 objections to the subpoena, including one that only the=20 Federal Energy Regulatory Commission has the authority to investigate=20 wholesale markets. The committee voted to overrule most of the objections. = =20 The committee will prepare a report to the full Senate, recommending the=20 company be cited for contempt. If Enron turns over the records before the= =20 Senate takes up the matter, the report will be shelved. "They've sent two= =20 things to Texas =01) our money and these documents, and they're saying we c= an't=20 get either one back," said Laurence Drivon, special legal counsel to the=20 Senate committee. The other subject of possible sanctions, Atlanta-based= =20 Mirant Inc., agreed to turn over subpoenaed documents. The committee will= =20 review Mirant's compliance in 30 days and could revisit whether to find it = in=20 contempt. Mirant spokesman Pat Dorinson said the company has turned over= =20 159,000 pages of documents that were being transferred to a repository in= =20 Sacramento to comply with the subpoena. The company and the committee=20 reached an agreement Tuesday night on the confidentiality concerns, Dorinso= n=20 said. Committee chairman Joe Dunn, a Santa Ana Democrat, said the=20 committee's investigation will continue despite Enron's "pure act of=20 intimidation. We're not going to back down." Enron's suit, filed in=20 Sacramento Superior Court, said the company's financial papers are outside= =20 the committee's jurisdiction because most of its operations and paperwork a= re=20 outside California. That shouldn't matter, Drivon said, citing last year's= =20 successful subpoena of out-of-state documents during the investigation into= =20 the activities of former Insurance Commissioner Chuck Quackenbush. Previous= =20 investigations have included documents subpoenaed from other nations, he=20 said. Companies doing business in California cannot claim immunity from it= s=20 laws or oversight, Drivon and Dunn said. Houston-based Reliant Energy made= =20 the same argument but then agreed to turn over 1,800 documents. Enron's su= it=20 also says Dunn's committee has not given the company a fair hearing, and th= e=20 committee has not followed due-process protections before seeking sanctions= . =20 Not so, said Dunn and Drivon, adding that they negotiated with generators t= o=20 give them time to comply with the subpoenas. Proof of that, they said, come= s=20 in the decision to give Williams, AES, Reliant, Dynegy, Duke and NRG an ext= ra=20 week past Tuesday's deadline to turn over documents subpoenaed last month. = =20 In a letter to Dunn, Steven J. Kean, an Enron executive vice president, sai= d=20 several municipal districts were profiting from the power crisis. "Yet,=20 remarkably, the committee has inexplicably chosen not to include these mark= et=20 participants in its investigations." Enron officials are concerned the=20 purpose of the investigation, Kean said, is to "create a convenient politic= al=20 scapegoat to shoulder the blame for California's policy mistakes and change= s=20 in market fundamentals." If the full Senate approves a contempt citation, = it=20 will be the first time since 1929, when the Senate briefly jailed a relucta= nt=20 witness during a committee investigation of price fixing and price gouging= =20 allegations involving cement sales to the state. There are no set penaltie= s,=20 Drivon said =01) by law, "the Senate can take such action as it deems neces= sary=20 and appropriate." Enron is one of the world's leading electricity, natural= =20 gas and communications companies, with $101 billion in revenues in 2000. It= =20 owns 30,000 miles of pipeline, has 20,000 employees and is active in 40=20 countries. During the first quarter of this year, Enron's revenues increase= d=20 281 percent to $50.1 billion. It is well connected politically. It has=20 supported both President Bush and his father, President George H.W. Bush.= =20 Last year, Enron gave more than $172,000 to politicians and campaigns in=20 California. Last month the firm helped sponsor a congressional fund-raiser= =20 featuring the president, where contributors in tuxedos and gowns dined and= =20 drank around a giant gold "W" that reached to the rafters at the Washington= =20 Convention Center ballroom. Enron has also helped shape President Bush's= =20 energy plan. It is one of several major donors accused of meeting secretly= =20 with Vice President Dick Cheney to draft the plan. Company chairman Kennet= h=20 Lay is a friend and one of the largest campaign contributors to Bush and th= e=20 GOP. Several prominent members of the Bush administration hold Enron stock.= =20 Regulators want broad, regional power markets =20 \ objattph=20 ASSOCIATED PRESS July 11, 2001 WASHINGTON =01) Despite California's probl= ems=20 with electricity deregulation, the Federal Energy Regulatory Commission=20 reinforced its commitment Wednesday to developing broad, regional power=20 markets. The FERC, which regulates wholesale electricity markets, directed= =20 power grid managers in the Northeast and in the South to develop broad=20 regional power transmission management organizations. By unanimous votes,= =20 the agency rejected proposals in both regions of the country for smaller=20 geographical markets. The FERC kicked back proposals for separate regional= =20 transmission organizations in New England, New York and the mid-Atlantic=20 states. Regulators said the parties should develop a single regional=20 organization covering all three areas. At the same time, the commission sa= id=20 it wanted a broad organization covering most of the Southeast as well. In= =20 both cases, the agency directed that a mediator help the regions develop th= e=20 new regional power market systems. The commissioners have maintained that= =20 large, regional power management organization are necessary if electricity = is=20 to flow freely in a competitive marketplace. "The actions will go a long w= ay=20 toward facilitating ... more efficient regional power markets," said Lynne= =20 Church, president of the Electric Power Supply Association, which represent= s=20 independent power producers. The vote was the first on the issue since two= =20 new commissioners =01) Pat Wood and Nora Brownell, both appointed by Presid= ent=20 bush =01) joined the commission.=20 HUNGTINGTON BEACH Huntington Loses Battle on Generators Power: AES receives go-ahead to restart two shut-down units without a=20 restriction on out-of-state sales that the city had fought for. STANLEY ALLISON and CHRISTINE HANLEYS TIMES STAFF WRITER July 12 2001 The California Energy Commission on Wednesday voted to allow giant power=20 company AES to move ahead with plans to restart two mothballed generators i= n=20 Huntington Beach even without the company's guarantee that it would sell th= e=20 electricity within the state. The decision permits AES to begin operating the generators next month. The 3-1 vote marks a defeat for Huntington Beach, which had agreed to AES'= =20 plans only with the company's pledge that all electricity generated would b= e=20 used to ease the state's power crisis. In granting approval, energy=20 commissioners conceded that the deal does not come without potential harm t= o=20 the environment. "We do not know the extent of the plant's contribution to the transport of= =20 bacteria to the beach, which can result in beach closures and the loss of= =20 recreational opportunities to beach visitors and commercial opportunities t= o=20 local merchants," the ruling says. State officials said they decided to drop the restriction that AES sell pow= er=20 within California to avoid more delays and help fulfill Gov. Gray Davis'=20 executive order that the state significantly boost power production over th= e=20 next year. "It adds power that will make California's power grid more secure, and the= =20 more power we can get, the more secure we are from rolling blackouts," said= =20 energy commission spokesman Rob Schlichting. AES originally agreed to the restriction. But the company demanded that it = be=20 dropped after negotiations with the state over long-term energy contracts= =20 broke down in June. With no contracts, AES argued it should have the right to sell power produc= ed=20 in Huntington Beach to whomever it wants. Huntington Beach officials who lobbied hard for the sales restriction said= =20 they felt betrayed by the decision. They said the commission bowed to the demands of a corporation over local= =20 concerns. "AES got exactly what it wanted," said City Councilwoman Connie Boardman, w= ho=20 testified at the hearing. "There's a lot of impacts the residents of Huntington Beach put up with. Th= e=20 energy crisis is the reason this project was approved so rapidly. Now that= =20 seems irrelevant. I think it's a big waste of time." An AES spokesman said the company would prefer to sell its power to custome= rs=20 in California. But he acknowledged there is no guarantee the extra=20 electricity will remain in the state. Councilwoman Debbie Cook said she fully expects AES to sell the power to=20 out-of-state companies. "They're going to sell it where they can get the most money," Cook said. "If they can sell it outside the state and resell it at a higher rate, then= =20 that's what they're going to do." The two 40-year-old generators, which have been out of service since 1995,= =20 can produce enough power to supply 337,500 homes and represent almost 10% o= f=20 the 5,000 megawatts Davis has said he will bring into service this summer. AES said the retooling of Unit 3 is 75% complete and it should be on line b= y=20 Aug. 7, and Unit 4 is 70% complete and could come on line a week later. AES had also requested a 10-year license to operate the generators. But the commission on Wednesday sided with Huntington Beach on that point. The city lobbied for a five-year license and a five-year renewal if the=20 company complies with a host of laws and regulations.=20 Copyright 2001, Los Angeles Times <http://www.latimes.com<;=20 Enron Gets 2nd Chance to Turn Over Documents Energy: State Senate panel gives the electricity seller a way around a=20 contempt citation. But the company balks. CARL INGRAM TIMES STAFF WRITER July 12 2001 SACRAMENTO -- Acting five hours after Enron Corp. sued to stop a legislativ= e=20 investigation of its business practices, a state Senate committee Wednesday= =20 gave the electricity wholesaler a second chance to turn over documents and= =20 rid itself of a contempt citation. But officials at Enron, a major player in the California power market,=20 brushed aside the gesture, saying it fell far short of meeting the company'= s=20 objections. "Our position has not changed. . . . The issues we had at the beginning of= =20 the hearing, we still had at the conclusion of the hearing," spokeswoman=20 Karen Denne said. The Houston-based electricity wholesaler claimed in a=20 letter to the Senate investigative committee that it was being singled out = as=20 a "political scapegoat" for the energy mistakes of California officials. In the suit, Enron charged that the committee's investigation went far=20 outside the law, an allegation denied by Chairman Joe Dunn (D-Santa Ana). H= e=20 also denied the scapegoat charge. The lawsuit was filed in Superior Court 62 minutes before the select=20 committee investigating market manipulation was to finalize its earlier=20 finding of contempt against Enron. Enron appears to be the last of eight power sellers to refuse to make=20 documents available to the committee. Seven others also had held out, but i= n=20 the last two weeks have said they will provide the records or are negotiati= ng=20 to do so. Dunn said the committee must examine the hundreds of thousands of documents= ,=20 including what Enron called its "most closely guarded secrets," to determin= e=20 whether price gouging occurred and whether remedial legislation is necessar= y. Gov. Gray Davis and other officials are convinced that the wholesalers=20 overcharged the state $8.9 billion during the energy crisis. A federal=20 mediator has said the overcharges are closer to $1 billion. But at Wednesday's hearing, an angry Sen. Steve Peace (D-El Cajon), a spons= or=20 of California's flawed 1996 deregulation law, charged that by suing the=20 committee, Enron was trying to "precipitate a constitutional crisis" betwee= n=20 the judicial and legislative branches of state government. "You just went to war with the state of California and the people of=20 California!" Peace shouted at Michael Kirby, a San Diego attorney=20 representing Enron. "You are already at war economically. Now you are at wa= r=20 politically." Kirby replied that Enron was merely trying to defend its right to due proce= ss=20 against what he called unlawful violations by the committee. He complained that Enron was held in contempt on June 28 but that the compa= ny=20 had never been given a chance to present its objections. "An accused criminal has been given more opportunity to have a hearing on= =20 their objections than I have [in this committee]," Kirby told the lawmakers= . Sen. Debra Bowen (D-Marina del Rey), also an attorney, told Kirby that=20 legislative subpoenas are far different than those issued in the court syst= em=20 and are not subject to the same restrictions because lawmakers must deal wi= th=20 policy issues, not matters of guilt or innocence. In their suit and testimony to the committee, Enron representatives charged= =20 the committee had ventured far out of its jurisdiction and that only the=20 Federal Energy Regulatory Commission could legally undertake a wholesale=20 price investigation and impose sanctions. The committee asked for a vast array of documents, including those involvin= g=20 business decisions and transactions in other states. But Enron claimed that= =20 the committee had no authority to issue subpoenas outside California and th= at=20 the subpoenas themselves were flawed. The company asked the court for an injunction against further investigation= =20 by the committee and proposed that a "neutral" arbitrator or judge try to= =20 fashion a compromise. Dunn suggested that the lawsuit was an effort to intimidate the committee.= =20 But he insisted it "will not impact our investigation." Under contempt procedures, last used in 1929, the committee can find an=20 individual or entity in contempt. It then reports its recommendations to th= e=20 full Senate, which must ratify the committee's action. The Senate also can= =20 impose sanctions, ranging from possible jail terms to heavy penalties. Dunn offered Enron what he called a "middle ground" that would give the=20 company an opportunity to change its mind and comply with the subpoenas=20 instead of facing an immediate report to the Senate. Under Dunn's recommendation, approved on a bipartisan 5-0 vote, the report = of=20 Enron's failure to comply would be compiled and written, but it would not b= e=20 delivered to the full Senate until Monday at the earliest. If Enron were to reverse itself and agree to provide the records the=20 committee wants, sign a confidentiality agreement and create a Sacramento= =20 repository for its records, the committee would hold the report back. If compliance continued, Dunn said, the committee's contempt finding would = be=20 purged. Dunn said he decided to give Enron a second chance because his "No. 1=20 priority is to get the documents. Contempt is the last resort." Denne, the Enron spokeswoman, noted that the company recently established a= =20 document repository in Sacramento for records of its California operations,= =20 but not the disputed documents involving business elsewhere. She contended that the confidentiality agreements proposed by the committee= =20 failed to "guarantee that these documents would remain confidential." Another wholesaler, Mirant, also had been held in contempt by the committee= .=20 But Dunn said that since its June 28 citation, Mirant had become cooperativ= e.=20 The committee agreed to review Mirant's citation in a month and possibly=20 erase it.=20 Copyright 2001, Los Angeles Times <http://www.latimes.com<;=20 Coal futures to begin trading but analysts aren't sure it'll heat up energy= =20 markets=20 BRAD FOSS, AP Business Writer Thursday, July 12, 2001=20 ,2001 Associated Press=20 URL:=20 <http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2001/07/12/= natio nal0435EDT0461.DTL< (07-12) 01:35 PDT NEW YORK (AP) --=20 While the New York Mercantile Exchange believes it can stoke interest in co= al=20 futures trading, analysts say this fossil fuel won't necessarily take off= =20 like wildfire on commodities markets.=20 "It's gonna be real wait and see," said David Khani, a coal analyst for=20 Friedman, Billings, Ramsey Group Inc. of Arlington, Va.=20 Futures exchanges exist to transfer the risk of price volatility from peopl= e=20 who don't want it -- in this case, power producers or steel manufacturers -= -=20 to speculators who are willing to take a gamble on making profits from this= =20 uncertainty.=20 One of the main reasons for doubts about coal as a commodity is that it has= =20 little history of wide price fluctuations, a key ingredient in bringing=20 together buyers and sellers. And of the roughly 1 billion tons of coal burn= ed=20 in the United States annually, 80 percent is bought through long-term=20 contracts, not on the daily spot market.=20 Skeptics also contend that the exchange is overestimating the industry's ne= ed=20 for coal futures, arguing that power producers are protected from price=20 swings by passing along higher costs to consumers.=20 But those assumptions were under assault as Nymex's Central Appalachian=20 futures contracts were to begin trading on Thursday.=20 The price of coal per ton doubled in a matter of weeks last winter in some= =20 parts of the country, boosting the stock prices of coal companies just as= =20 quickly.=20 Also, as more and more states deregulate electricity markets, power provide= rs=20 like Mirant Corp., American Electric Power Company Inc. and Dynegy Inc.,=20 won't be able to hide behind laws allowing them to pass on higher costs to= =20 consumers. Instead, they will be forced to become more competitive with one= =20 another, said Andy Ozley, manager of fossil fuels for Atlanta-based Mirant.= =20 "Welcome to the free market," he said. "The pace of deregulation will=20 encourage more and more activity on the exchange. At least that's the hope.= "=20 The swapping of coal contracts is not entirely new.=20 Energy traders, including Mirant, Enron Corp. and Aquila Inc., helped build= =20 an international over-the-counter exchange on which some 1 million tons of= =20 coal can switch hands on any given day. Some days, not a single transaction= =20 takes place.=20 Just how much daily volume Nymex coal futures will add to the mix is=20 anybody's guess.=20 Nymex Executive Vice President Neal Wolkoff said, "If it starts in the low= =20 hundreds and builds to maybe 5,000 contracts a day I think that would be=20 viewed as a successful marketplace.=20 "We don't expect this to approach anywhere near the size of natural gas and= =20 crude oil," for which hundreds of thousands of contracts are swapped each= =20 day, Wolkoff said.=20 At the very least, Wolkoff said, the Nymex coal futures will benefit the=20 industry by making a "transparent price reference" available to buyers and= =20 sellers of both long- and short-term contracts.=20 But critics believe Nymex's coal futures will suffer the same low trading= =20 volume that the exchange's electricity futures have since 1996.=20 "There will be a flurry of trading when it starts, though I'm not so sure= =20 it's going to be a long-term success," said Howard Simons, a finance=20 professor at the Illinois Institute of Technology and a former commodities= =20 trader.=20 The run-up in coal prices last winter occurred as demand outstripped supply= .=20 Coal companies curtailed production and even closed some mines after a mild= =20 winter in 2000 at a time when power producers sought a less expensive=20 alternative to natural gas, which had quadrupled in price.=20 Developments in California's energy crisis=20 The Associated Press Thursday, July 12, 2001=20 ,2001 Associated Press=20 URL:=20 <http://www.sfgate.com/cgi-bin/article.cgi?file=3D/news/archive/2001/07/12/= state 1038EDT0155.DTL< (07-12) 07:38 PDT (AP) --=20 Developments in California's energy crisis:=20 THURSDAY=3D * No power alerts Thursday as electricity reserves stay above 7 percent.=20 WEDNESDAY=3D * Enron Corp. sues state officials to stop a Senate subpoena of its financi= al=20 records in a dispute over alleged overcharges for its electricity sales to= =20 California. The suit comes hours before the committee voted to ask the full= =20 Senate to cite the Houston-based company for contempt.=20 The other subject of possible sanctions, Atlanta-based Mirant Inc., agreed = to=20 turn over subpoenaed documents. The committee will review Mirant's complian= ce=20 in 30 days and could revisit whether to find them in contempt.=20 * State power regulators shelve a plan to save much-needed electricity by= =20 slightly reducing the juice to common household appliances after a=20 misunderstanding with Pacific Gas and Electric Co.=20 Regulators at the state Public Utilities Commission were set to approve the= =20 conservation measure at a meeting Thursday, but will postpone action, sayin= g=20 "last-minute concerns" raised by PG&E have made the plan less attractive th= an=20 advertised. PG&E officials said they think the plan is a good one and are= =20 baffled why the PUC is not passing it.=20 * California's two public university systems reach a tentative settlement= =20 with Enron Energy Systems Inc. to buy cheap power, bringing to an end a=20 federal lawsuit accusing the Houston company of wanting to sell the=20 electricity at a higher cost.=20 * Secretary of State Bill Jones says dozens of energy consultants hired by= =20 Gov. Gray Davis haven't filed required statements of economic interest. Jon= es=20 says as many as 47 consultants should have to file the statements. Oscar=20 Hidalgo, spokesman for the Department of Water Resources, says about 20=20 consultants have been told they have until Monday to file those forms.=20 * The Assembly Appropriations Committee approves a bill to create criminal= =20 penalties for energy price gouging. The bill, by Lt. Gov. Cruz Bustamante a= nd=20 Assemblyman Dennis Cardoza, D-Atwater, now goes to the Assembly for a vote.= =20 * The state Energy Commission approves San Diego area "peaker" plant which= =20 will generate 49.5 megawatts during high-demand periods. The CalPeak Power = at=20 Border Project is the 11th peaker plant licensed by the commission under an= =20 expedited review process.=20 * Davis helps celebrate the 25th anniversary of the California Conservation= =20 Corps, particularly their participation in the PowerWalk energy conservatio= n=20 program. The corps members have distributed more than 500,000 energy=20 efficient fluorescent light bulbs, and by summer's end will have distribute= d=20 more than 1.6 million bulbs, saving 100 megawatts.=20 * Shares of Edison International closed at $14.06, up a penny. PG&E Corp.= =20 stock increases 20 cents to close at $13.75. Sempra Energy, the parent=20 company of San Diego Gas & Electric Co., closed at $27.49, down 18 cents.= =20 * No power alerts Wednesday as electricity reserves stay above 7 percent.= =20 WHAT'S NEXT=3D * The Senate committee investigating possible price manipulation in=20 California's energy market meets July 18 to consider compliance by six ener= gy=20 suppliers who had documents subpoenaed last month.=20 THE PROBLEM: High demand, high wholesale energy costs, transmission glitches and a tight= =20 supply worsened by scarce hydroelectric power in the Northwest and=20 maintenance at aging California power plants are all factors in California'= s=20 electricity crisis.=20 Southern California Edison and Pacific Gas and Electric say they've lost=20 nearly $14 billion since June 2000 to high wholesale prices the state's=20 electricity deregulation law bars them from passing on to consumers. PG&E,= =20 saying it hasn't received the help it needs from regulators or state=20 lawmakers, filed for federal bankruptcy protection April 6. Electricity and= =20 natural gas suppliers, scared off by the companies' poor credit ratings, ar= e=20 refusing to sell to them, leading the state in January to start buying powe= r=20 for the utilities' nearly 9 million residential and business customers. The= =20 state is also buying power for a third investor-owned utility, San Diego Ga= s=20 & Electric, which is in better financial shape than much larger Edison and= =20 PG&E but is also struggling with high wholesale power costs.=20 The Public Utilities Commission has approved average rate increases of 37= =20 percent for the heaviest residential customers and 38 percent for commercia= l=20 customers, and hikes of up to 49 percent for industrial customers and 15=20 percent or 20 percent for agricultural customers to help finance the state'= s=20 multibillion-dollar power buys.=20 Track the state's blackout warnings on the Web at=20 www.caiso.com/SystemStatus.html <http://www.caiso.com/SystemStatus.html<;.= =20 ,2001 Associated Press=20 Enron files suit over subpoena=20 Provider challenges move for documents=20 Lynda Gledhill, Chronicle Sacramento Bureau <mailto:lgledhill@sfchronicle.c= om< Thursday, July 12, 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= 7/12/ MN193079.DTL< Sacramento -- In another escalation in the war between California and=20 out-of-state energy providers, Enron Corp. filed a lawsuit yesterday=20 challenging the Legislature's authority to subpoena company documents.=20 The suit came as a Senate panel investigating market manipulation voted 6 t= o=20 0 to move forward with a contempt motion against Enron. A report will be=20 forwarded to the full Senate early next week if the marketer continues to= =20 refuse to comply with the subpoena.=20 "You just went to war with the
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