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San Jose Mercury News; June 23, 2001, SaturdaySECTION: STATE AND REGIONAL
NEWS; Testimony says Duke ???Energy actions 'unconscionably wrong'- By Dion Nissenbaum (Quotes Smutny) Copley News Service, June 25, 2001, Monday, State and regional, 1085 words, ????3 new plants to generate electricity within weeks, Ed Mendel, SACRAMENTO Los Angeles Times, June 25, 2001 Monday, Home Edition, Page 7, 730 words, ????The State; ; Power Regulators to Determine State Refunds; Energy: Generators ????and California officials will work together for 15 days to solve the huge ????mathematical problem., MEGAN GARVEY, TIMES STAFF WRITER, WASHINGTON Los Angeles Times, June 25, 2001 Monday, Home Edition, Page 7, 777 words, ????The State; ; In the Dark, Trying to See Light at End of Crisis, GEORGE ????SKELTON, SACRAMENTO Los Angeles Times, June 25, 2001 Monday, Home Edition, Page 1, 1629 words, ????Demand Had Minor Role in Power Crisis; Electricity: Consumption has been ????predictable, and rose less quickly than in other Western states. But supply ????grew hardly at all, and reserves melted away., ROBIN FIELDS, TIMES STAFF ????WRITER San Jose Mercury News, June 25, 2001, Monday, SJ-POWER-PLANT, 1356 words, ????Pending Power Plants in California Face Some Problems, By Steve Johnson The San Francisco Chronicle, JUNE 25, 2001, MONDAY,, FINAL EDITION, NEWS;, ????Pg. A1, 720 words, THE ENERGY CRUNCH; ???$9 billion showdown over power; ????State delegation seeking refunds, Lynda Gledhill, Christian Berthelsen The San Francisco Chronicle, JUNE 25, 2001, MONDAY,, FINAL EDITION, ????BUSINESS;, Pg. B1, 1938 words, BECHTEL HOLDS ITS OWN; ???Despite economic ????downturn, S.F. construction giant's revenues remain steady, Todd Wallack The Washington Times, June 25, 2001, Monday, Final Edition, PART A; ????COMMENTARY; Pg. A13, 917 words, Price cap perils . . . and peripatetics, ????Donald Lambro; THE WASHINGTON TIMES Los Angeles Times, June 24, 2001 Sunday, Home Edition, Page 6, 1061 words, ????THE STATE / POLITICS; Why Riordan Can't Be Governor, TONY QUINN, Tony Quinn ????is co-editor of the "California Target Book," an, analysis of California ????legislative and congressional campaigns, SACRAMENTO Los Angeles Times, June 24, 2001 Sunday, Home Edition, Page 4, 408 words, ????Contradictions in State's Energy Plan Los Angeles Times, June 24, 2001 Sunday, Home Edition, Page 4, 557 words, ????Life After the Crisis Sacramento Bee, June 24, 2001, Sunday, Pg. A19;, 1393 words, Bush's energy ????chief confronts the spotlight Spencer Abraham finds himself in the hot seat ????as he helps pitch the president's power plan., James Rosen Bee Washington ????Bureau, WASHINGTON The San Francisco Chronicle, JUNE 24, 2001, SUNDAY,, FINAL EDITION, NEWS;, ????Pg. A21, 1056 words, ENERGY CRUNCH; ???Direct access falls victim to crisis; ????Power-buying plan's future is in doubt, Bernadette Tansey, Greg Lucas The Washington Times, June 24, 2001, Sunday, Final Edition, PART B; ????COMMENTARY; FORUM; Pg. B5, 907 words, Girding for a cooperative grid, Glenn ????English Chicago Tribune, June 24, 2001 Sunday, CHICAGOLAND EDITION, News; Pg. 10; ????ZONE: C; ACROSS THE NATION., 263 words, Power plant whistleblowers allege ????production sabotage, Items compiled from Tribune news services., SACRAMENTO, ????CALIFORNIA ????????????????????????????San Jose Mercury News ???????????????????????????June 23, 2001, Saturday SECTION: STATE AND REGIONAL NEWS KR-ACC-NO: ?K1692 LENGTH: 1056 words HEADLINE: Testimony says Duke Energy actions 'unconscionably wrong' BYLINE: By Dion Nissenbaum BODY: ??SACRAMENTO, Calif. _ A major energy company accused of gouging California ran one plant like a "yo-yo," scaling back the flow of electricity even as the state was trying desperately to find power to avert blackouts, a former plant worker told state investigators Friday. ??In a packed Capitol hearing room, former mechanic Glenn Johnson called such actions at the Chula Vista plant run by Duke Energy "absolutely, unconscionably wrong." ??Armed with control room logs taken from the plant, Johnson and two other former plant workers publicly offered the special Senate committee investigating alleged price gouging the first inside accounts of power plant operations and provided them with hard evidence for their ongoing investigation. ??Lawmakers said they wouldn't draw conclusions until they get a chance later this summer to hear from Duke, which leases the plant from the Port of San Diego. ??But one senator, Steve Peace, D-La Mesa, said he is already convinced that Duke has broken its contract, which requires the plant to use "prudent practices." ??"I believe the evidence is clear that Duke has operated, and is operating in violation of its lease," Peace said. "I believe the port can take it back." ??While not given a chance to rebut the testimony at the hearing, Duke executives dismissed the three men as misguided former workers who had small roles in a big operation and didn't understand what they were seeing. ??"This is one more page in a very long chapter of misinformation disseminated by people who are not telling, or do not know, the full story," said Bill Hall, vice president of Duke's West Coast operations. ??Duke did change the amount of energy it produced, Hall said. But, in everycase, he added, the company did so at the direction of state regulators who oversee the ebb and flow of power. ??"Duke Energy is not gouging," he said. ??Senate investigators plan to match state records to the Duke logs to see if, as the company executives argue, each decision was made at the request of regulators. After reviewing the records Friday afternoon, the committee staff expressed skepticism about Duke's contention that the decisions, some of them made after midnight, were directed by state officials. ??Assistant plant operator Jimmey Olkjer decoded the handwritten logs for lawmakers, pointing out when and how Duke shifted power production. In one case on Jan.16, the logs show, the plant directed workers to slow production from 92 megawatts to 30 megawatts. An hour later, the state issued a Stage 3 alert indicating power reserves were low and blackouts imminent. In the next few hours, Duke pushed production up to 149 megawatts. ??Such moves, Olkjer said before the hearing, appeared to be an effort to manipulate the market to boost prices. ??California uses complex maneuvers to make sure that it has enough power. At times, because of congestion on transmission lines, regulators actually pay energy companies to scale back production because they can't move it around the state. ??But state regulators declined to comment on the allegations or the logs, saying they are prevented from discussing specific arrangements with Duke or other private companies. The Chula Vista plant produces enough power for about 500,000 homes. Duke has leased the plant since 1998. ??Under scrutiny ??Along with the state's other major power producers, Duke is under intense scrutiny for its actions in California's dysfunctional electricity markets. The company is facing state and federal investigations, as well as a class-action lawsuit. ??Lt. Gov. Cruz Bustamante, who is spearheading a taxpayer lawsuit against Duke and other power companies for alleged price gouging, called the whistle-blower testimony "the tip of the iceberg." ??This week, federal officials again ordered Duke to refund California what could be millions of dollars for alleged overcharges. Duke has admitted that it charged a record $3,880 per megawatt-hour in January for some of its power. The company said it provided the power at California's request as the state tried to head off blackouts, tacking on an 80 percent surcharge because of Pacific Gas & Electric Co.'s credit problems. ??Executives for Duke and other power producers will head to Washington, D.C., next week to take part in marathon settlement talks over alleged price gouging. Gov. Gray Davis and other California leaders contend that the companies overcharged the state by nearly $8.9 billion. ??At the hearing, Olkjer and Johnson were joined by former mechanic Ed Edwards. All three worked for the plant's former operator, San Diego Gas and Electric, and continued working during a two-year transition period when Duke took over. They were all let go in April. ??Edwards and Olkjer told the committee that they had stellar personnel records. Johnson conceded that he was not considered a model employee because he sometimes complained to his union about mistreatment and spent a lot of time off work serving in the California National Guard. ??Johnson and Edwards told lawmakers that they were directed to throw out perfectly good spare parts to clear space in the plant. They said that sometimes caused delays of days or weeks in getting it back up-and-running. ??Duke said it threw out the spare parts to get rid of old or obsolete equipment. ??The hearing drew sharp criticism from the state's largest independent power producer group. ??In a letter to Sen. Joe Dunn, the Garden Grove Democrat heading the committee, the group accused lawmakers of setting aside facts in pursuit of a media event "giving credence to the unsustainable allegations of disgruntled employees." ??"The committee is at a crossroads," wrote Jan Smutny-Jones, executive director of the Independent Energy Producers. "It can choose to engage in fact-finding and analysis, or it can be reduced to a witch hunt in pursuit of headlines." ??Dunn angrily challenged the characterization of his hearings and said he plans to give Duke and other power companies plenty of time to respond in the coming weeks. ??Sen. Bill Morrow of San Juan Capistrano, the ranking Republican, agreed with Dunn and rejected notions that the committee is a "kangaroo court." ??© 2001, San Jose Mercury News (San Jose, Calif.). ??Visit Mercury Center, the World Wide Web site of the Mercury News, at http://www.sjmercury.com/ Copyright 2001 Copley News Service Copley News Service June 25, 2001, Monday SECTION: State and regional LENGTH: 1085 words HEADLINE: 3 new plants to generate electricity within weeks BYLINE: Ed Mendel DATELINE: SACRAMENTO BODY: ??Gov. Gray Davis said yesterday that three new power plants will begin operating within 17 days, giving California its first new major generators in more than a decade and easing the threat of blackouts this summer. ??News about the plants comes on the heels of other developments about conservation and additional power supply that have given state officials increasing confidence in California's ability to survive the power crisis this summer. ??''Optimistically,'' said Davis, ''our conservation and generation effort will help us minimize any disruptions this summer.'' ??One of the new plants was scheduled to begin operating in August but instead will come on line Wednesday. Edison International's Sunrise plant near Bakersfield will supply 320 megawatts. A megawatt can provide enough power for 750 to 1,000 households. ??In addition to the Edison facility, Calpine will open its 500-megawatt Sutter plant near Yuba City on July 2 and its 559-megawatt Los Medanos plant near Pittsburg 10 days later. Both plants are expected to open according to schedule. ??''In the next 17 days we will put more power on line than California did in the last 12 years,'' Davis said. ??During the past decade, the governor said, the state added less than 1,000 megawatts with a number of small power plants, despite population growth and increased power demand from the high-tech industry. ??The fast-track modernization of a 450-megawatt Huntington Beach plant is expected by late August. The plant was shut down about five years ago. ??By September, Davis said, the addition of eight to 10 small plants that operate during peak-load periods, as well as increased power from a variety of other small generators, will raise the total of new power coming this summer to 4,000 megawatts. ??As further protection against blackouts, state power buyers revealed last week that in recent months they have been able to send some surplus electricity to a Canadian utility, BC Hydro, which will return the power in July and August. ??Despite efforts to increase the state's energy supply this summer, more ultimately will be needed. California has been importing about 20 percent of its power in recent years. Even though about a dozen power plants are approved or under construction, Davis does not expect supply to match demand until late 2003. Until then, the state will need surplus electricity generation to make the deregulated market work properly, experts say. ??Davis has said in the past that California should add 20,000 megawatts of power generation in the years ahead. A new state Power Authority has been created that could construct or buy power plants if the private sector does not build a surplus of electricity generation. ??Also, state officials suggest the trend among Californians to conserve electricity may grow. ??The state is spending $850 million on conservation programs, including funding for energy-efficient equipment and an advertising campaign. The program gives refunds to customers who dramatically reduce their electricity consumption this summer. ??State officials also expect electricity use to be reduced by ''sticker shock'' from rate increases beginning this month for Edison and Pacific Gas and Electric customers. Ratepayers are exempt from the increase if they use 130 percent or less of the baseline level of electricity, a minimal amount that varies with regional climate zones. ??A proposal to increase rates for San Diego Gas & Electric customers is pending before the state Public Utilities Commission. ??In addition to announcing the new plants, Davis yesterday reiterated his demand that California deserves $8.9 billion in refunds from overcharges by power companies. That issue will be the subject of mediation sessions that begin today in Washington. ??When the Federal Energy Regulatory Commission imposed regional price limits last week, the regulators asked an administrative law judge to recommend possible refunds by generators for overcharging. ??Davis said the California negotiating team will be led by Michael Kahn, chairman of the Independent System Operator, which runs the state's electricity grid. ??Davis said Kahn's team will present information supporting California's claim of overcharging. The administrative law judge, Curtis Wagner Jr., suggested last week that California may be owed a smaller amount, $2 billion to $2.5 billion. ??The governor sent Wagner a brief letter replying to the judge's request for a list of issues that should be considered in the conference. ??''Our list is short,'' Davis said in the letter. ''The conference must address the need to have FERC order power sellers to refund the estimated $8.9 billion they have overcharged the people of the State of California.'' ??While that session is taking place, Davis today plans to meet in Sacramento with President Bush's two new appointees to the five-member FERC, Pat Wood III of Texas and Nora Brownell of Pennsylvania. ??Davis said that when he met with the president last month, Bush agreed to send Wood to California to investigate natural gas prices, which are several times higher in California than in New York. ??''We agreed that there is no explanation for the disparity of prices between California and New York when it comes to natural gas,'' Davis said. ''We agreed that was wrong.'' ??The governor also said he will meet this morning with three former employees of Duke Energy's Chula Vista power plant who have accused the company of altering the plant's output to boost power prices. ??The employees last week told a state Senate committee that they were ordered to reduce power during peak-load periods and throw away good replacement parts, which sometimes delayed maintenance. ??''There may be another side to the story,'' Davis said. ''But these three employees worked 20 years, had no reason to mislead the state Senate, and they testified under oath.'' ??Duke denied wrongdoing and said power was reduced at the request of the agency that runs the power grid, the Independent System Operator. ??A Davis spokesman said yesterday that he did not know if the former employees could qualify for a reward. In April, state Attorney General Bill Lockyer announced a whistle-blower reward for information on price-gouging by power generators. ??Lockyer said the reward would be based on a percentage of what the state recovers as a result of the information. He said the reward could be worth $50 million or more. ??WAGNER-CNS-SD-06-24-01 2151PST LOAD-DATE: June 25, 2001 ??????????????????????????????8 of 141 DOCUMENTS ??????????????????????Copyright 2001 / Los Angeles Times ??????????????????????????????Los Angeles Times ??????????????????????June 25, 2001 Monday ?Home Edition SECTION: California; Part 2; Page 7; Metro Desk LENGTH: 730 words HEADLINE: The State; ; Power Regulators to Determine State Refunds; Energy: Generators and California officials will work together for 15 days to solve the huge mathematical problem. BYLINE: MEGAN GARVEY, TIMES STAFF WRITER DATELINE: WASHINGTON BODY: ??Starting today, federal power regulators will begin trying to solve one of the riddles of the energy crisis: How much of a refund will California get? ??One thing seems clear: The reduction will be a lot more than the $125-million refund ordered to date, in all likelihood soaring to more than $1 billion. ??Over the next 15 days--the Federal Energy Regulatory Commission is mandating no weekends off--warring representatives from power companies and the state of California will sit at the same table in a government conference room while a FERC task force wrestles the question to the ground. ??The task is to determine the price that power would have cost if FERC's decision to impose soft caps had been made not last week, but last fall. ??It is a daunting mathematical problem, factoring in hourly charges during the last eight months. To come up with a total, federal regulators, state electricity officials and power generators must determine what the highest price for a megawatt should have been under the soft price caps now in effect. Then they have to figure out which companies--if any--were charging more. ??Under the recent FERC ruling, the price of electricity during any given hour cannot exceed the actual cost of generating the least efficient--or most expensive--power coming into the grid. ??Curtis L. Wagner, the 72-year-old chief judge for FERC who is overseeing negotiations on California's overcharges, said of this morning's events: "It will be a zoo." ??Wagner, who headed into the weekend with three inches of documents to sort through, explained that Gov. Gray Davis wants $9 billion knocked off the amount the power generators charged California. "I don't really think it's that high," said Wagner, predicting the refund will be more than $1 billion but probably far from $9 billion. ??"We have folks trying to do some adding now and some work on what the number should be," he said. ??Wagner said the money at stake will be the most he has worked on in his nearly three-decade career at the agency. ??Until recently, the likelihood of massive refunds seemed nil. Although California lawmakers--led by Davis--had demanded relief for costs that ran as high as 10 times or more than the rates a year ago, FERC officials had not agreed. ??And their minds seemed set. When FERC first proposed remedies for the California price increases late last year, commissioners said: "Refunds may be an inferior remedy from a market perspective and not the fundamental solution to any problems occurring in California markets." ??To date, FERC has ordered $125 million in refunds for alleged overcharges in January and February. ??But with the recent appointment of two new commissioners by President Bush--Republicans Patrick H. Wood III of Texas and Nora M. Brownell of Pennsylvania--FERC's position softened, leading to the price mitigation ordered last week. ??Now FERC is taking a closer look at the prices already charged. ??California lawmakers have pegged overcharges at nearly $9 billion since the California market went haywire last summer--a number that comes from a study done by Cal-ISO, the operator of California's electricity grid. Cal-ISO officials acknowledged last week that the study might have significant flaws. ??Among companies that may be required to reduce their bills are energy giants Enron Corp., Mirant Corp., Duke Energy Corp., Williams Cos. and Reliant Energy Inc.--all of which are expected to have representatives at the negotiations. The companies have hotly disputed the amount of overcharges alleged by Davis and other California lawmakers and point out that they have yet to be paid for the vast majority of electricity sold in the state in recent months. ??Today, Wagner said he plans to make opening statements to the media. After that, he said he hasn't determined how much of the wangling will be done behind closed doors. If the parties don't come to an agreement in 15 days, Wagner will have seven days to make a recommendation on refunds to FERC's five commissioners. ??It is a process that may be repeated down the road if Sen. Barbara Boxer (D-Calif.) and other California politicians get their way. Boxer has introduced legislation that would give FERC retroactive power to order refunds--all the way back to July 2000, when San Diego first faced huge spikes in electricity costs. LOAD-DATE: June 25, 2001 ??????????????????????????????9 of 141 DOCUMENTS ??????????????????????Copyright 2001 / Los Angeles Times ??????????????????????????????Los Angeles Times ??????????????????????June 25, 2001 Monday ?Home Edition SECTION: California; Part 2; Page 7; Metro Desk LENGTH: 777 words HEADLINE: The State; ; In the Dark, Trying to See Light at End of Crisis BYLINE: GEORGE SKELTON DATELINE: SACRAMENTO BODY: ??It's dusk in the Capitol office of state Sen. Debra Bowen. Actually, it's midafternoon. But she has the lights off to save electricity and not much sun is coming through a shaded window. ??Her thermostat is set at 76 degrees, but it feels warmer because outside it's 100 and she's up on the fourth floor. ??There's a bright red, oversized cover framing a shiny white light switch by the door. You can't miss it leaving the room. "That's for the people who have trouble turning off lights," she says. ??Bowen, 45, a Marina del Rey Democrat and environmental lawyer, represents the good side of term limits. Conscientious and cutting-edge. She replaced a termed-out, octogenarian senator, Ralph Dills, first elected to the Legislature in the Great Depression. ??Since coming to the Assembly in 1992, Bowen has focused on environmental protection, foster children and high-tech--most recently trying, unsuccessfully, to guard the privacy of Internet consumers. ??But now, like the Legislature itself, she's bogged down with an all-consuming issue that won't go away. The senator has been thrust into the middle of a tangled energy mess she and other lawmakers unwittingly helped create with their lemming-like votes five years ago. ??This time, however, Bowen is a major player as head of the Senate energy committee. ??Something must be going right, I note. We haven't had any of those rolling blackouts everybody had predicted for June. ??"My biggest concern," she replies, sitting in the twilight, "is that we're being fooled right now because of the early snowmelt. We've got more power than we need." ??Hydroelectric power being generated by the Sierra runoff, she explains, is being sent to British Columbia. BC is using the California power and keeping its own water stored behind dams. Later in summer, as this state runs dry, BC will generate hydro and send it to us. ??Thus every kilowatt California saves today can be banked in Canada and later withdrawn during tough times. ??"I don't want people to get the idea that just because we haven't had Stage 2s or blackouts we shouldn't be concerned," Bowen says. "We're still going to be short power this summer. . . . ??"But how do you expect Jane Citizen to figure all this out?" ??Especially when Joe and Janice Legislator are having such a difficult time. ??There is one vexing problem still facing the Legislature on energy. It has passed bills promoting conservation, expediting power plant construction, authorizing the state to sign long-term contracts for wholesale electricity, creating a state power authority and approving bond sales to finance it all. What's left is how--and whether--to save Southern Cal Edison from bankruptcy. ??The Legislature faces an Aug. 15 deadline to approve a memo of understanding between Gov. Gray Davis and Edison. After that, the MOU presumably goes poof and Edison collapses. ??But the Legislature has a cocky way of ignoring and testing deadlines. Right now there must be 100 ideas about how to handle Edison. Decision-making is diffused. Bowen's energy committee, for example, is just one of three that is holding Senate hearings on the Edison bailout. ??"There's not much consensus," she acknowledges. ??The governor's proposed Edison rescue involves state purchase of the utility's transmission lines for about $2.8 billion. Democrats seem ambivalent and Republicans are opposed. Long ago, the MOU was diagnosed as DOA. ??Senate leader John Burton (D-San Francisco)--the most powerful legislator--thinks the MOU is a giveaway to Edison. ??In the Assembly, Speaker Bob Hertzberg (D-Sherman Oaks) has been pushing a unique alternative he believes could also work for PG&E, now struggling in Bankruptcy Court. Under his plan, only the "core" residential and small business users would be served by private utilities. Electricity would be generated by the utilities themselves and regulated by the Public Utilities Commission. Like the good old days before disastrous deregulation. ??The "noncore" big power users who wanted deregulation in the first place would buy electricity directly from the generators and marketers, presumably at a savings. "They're the ones who brought this on us," Hertzberg says. ??But, he adds, "there's a billion moving parts" and they're not fitting well. For one, there may not be enough power to buy directly now that the state has cornered so much in long-term contracts. ??Bowen is one of the better ones. But not even she is sure what the Legislature's next step should be. "We don't have a lot of room to move," she says. ??Nor a lot of time. If Edison goes bankrupt, it truly will be a dark day in the Capitol. LOAD-DATE: June 25, 2001 ?????????????????????????????10 of 141 DOCUMENTS ??????????????????????Copyright 2001 / Los Angeles Times ??????????????????????????????Los Angeles Times ??????????????????????June 25, 2001 Monday ?Home Edition SECTION: California; Part 2; Page 1; Metro Desk LENGTH: 1629 words HEADLINE: Demand Had Minor Role in Power Crisis; Electricity: Consumption has been predictable, and rose less quickly than in other Western states. But supply grew hardly at all, and reserves melted away. BYLINE: ROBIN FIELDS, TIMES STAFF WRITER BODY: ??California has been depicted as a power addict whose growing habit led inexorably to the crisis that has roiled the state since May 2000. ??Yet the state's electricity yen is the wrong target for blame--the least volatile and least decisive piece of a larger puzzle, an analysis of consumption patterns shows. ??California consumption has been as regular as a heartbeat in the last decade, sloping upward gently with a blip each summer. In the last year, demand's predictability made it the lone calm spot within a hailstorm of dizzying price peaks and supply lurches. ??Moreover, California's power consumption increased far less than that of its Western neighbors, on whose excess supply it had come to depend. ??"Yes, demand grew in California, but what people who have that discussion ignore is that demand in the rest of the West grew even faster," said Severin Borenstein, director of the UC Energy Institute in Berkeley. "We're all part of the same grid." ??Within the complex, sometimes murky power picture, demand was a problem hiding in plain sight. ??Starting in 1998, energy agencies began to warn that its slow swell, coupled with stagnant supply, had left California with wafer-thin power reserves. In retrospect, these agencies say, deregulation left them powerless to prevent the impending collision between supply and demand. ??When they hit head-on last summer, the amount of power used day to day by Californians often had no relationship to the periods when the state experienced blackouts or the highest wholesale prices, analysts said. ??In the last 10 years, California's power consumption has moved subtly, never advancing more than 3.7% a year and, even at its height, lagging behind such other measures as job growth and economic output. ??In the early 1990s, recession savaged heavy-duty power users, ranging from manufacturers to agricultural interests to the aerospace industry. The industrial sector's usage actually declined from 1990 to 1995. ??Overall, consumption inched up so slowly in the decade's first half--just 1.3%--that demand was of little concern as policymakers assembled the mechanisms of deregulation, current and former industry officials say. ??The system's reserve cushion--the extra supply available at peak times--was estimated in 1993 at a robust 12% to 14.5%, without a single electron imported from beyond California's borders. With pressure off, utilities shifted resources out of programs promoting conservation and redistributing peak-hour consumption. Instead, they focused on new technologies that had little immediate payoff. ??"There was less emphasis on demand management," said Barbara Barkovitch, an Oakland-based consultant who served on the California Independent System Operator's board from its formation in 1998 until last June. "There was nothing nefarious about it, but people always assume the future will be like the present." ??As the economy rebounded, consumption growth averaged about 3% a year. That slight escalation--which fell within the expectations of forecasters at the California Energy Commission--took on out-sized significance because it occurred as supply stagnated. ??"The problem was not one of demand in isolation, but that our demand kept growing steadily, supply did not grow much at all, and the gap just shrank progressively," said Ahmad Faruqui, the Palo Alto-based Electric Power Research Institute's area manager for retail and power markets. ??Regionally, the expansion was uneven, weighted toward the fast-developing San Diego area and Northern California's tech corridor. Consumption in San Diego Gas & Electric's service area rose more than 17% from 1995 to 2000 and, for the decade, increased almost twice as much as in the state overall. ??The commercial sector's usage grew twice as fast in the decade's last five years as it had in its first half as the economic mix shifted toward services and offices loaded up on energy-eating technology. ??The heady affluence of the late '90s also inflated residential consumption. ??Consumers splurged on bigger houses, pools and spas, more appliances and up-to-the-minute gadgetry, said Sean Randolph, president of the Bay Area Economic Forum. Fixed retail prices meant consumers had little incentive to rein themselves in, analysts said. ??"We decided we were not going to have a process for adjustment on the demand side," Borenstein said. "We relied entirely on the supply side and that turned out to be a huge mistake." ??Still, even as consumption grew, businesses became more efficient. Measured per capita, California's consumption remained modest compared to that of less efficient, more weather-intensive states. ??But gradually and quietly, the system's reserve margin shrank to 4% by 1998, a third or less than they had been at their fattest. Even that depended heavily on seasonal help from the other states that share California's grid, help they were increasingly less able to give. ??Electricity consumption in Arizona, Colorado and Utah grew at about twice California's rate from 1988 to 1998. It expanded three times as fast in Nevada. In these states, too, supply did not keep up. ??The collapse that started in May 2000 could have begun a year earlier if not for cool weather and plentiful rain, yielding cascades of Pacific Northwest hydroelectric power. ??At least six state, regional and federal energy agencies issued reports from late 1998 to early 2000 warning that California's reserve margin had shriveled, that help from other Western states might decrease, and that the state was one hot summer away from disaster. ??"The Arizona-New Mexico-Southern Nevada and the California-Mexico areas of [the Western transmission grid] may not have adequate resources to accommodate a widespread severe heat wave or a higher-than-normal forced outage rate for generation," wrote the North American Electric Reliability Council in its June 1999 summer assessment. "Those areas are experiencing a continuing trend of peak demand growth exceeding the addition of new generation facilities." ??But in the deregulated system, regulators no longer had a decisive hand in balancing supply and demand. Officials at the California Energy Commission say even analyzing the situation became harder as utilities became less methodical in submitting their consumption data. ??"Things got sloppier," said Michael Jaske, the commission's chief forecaster since 1980. "The utilities started letting that stuff slide, poorer data was coming in to us, and our management wasn't going after them the same way." ??Marketplace incentives were supposed to replace government control, but new supply did not materialize even though rising demand had created a clear-cut opportunity. ??Private generators say the system's uncertainties, plus California's environmental fervor and slow regulatory process, prevented the market from working. Borenstein's assessment is blunt: "The reason that no one built power plants was that no one thought you could make money at it." ??Ultimately, the flurry of studies predicting an oncoming crisis circulated among regulators and power industry insiders, but prompted little urgency when it came to curtailing demand. The Davis administration focused on supply instead, taking steps to expedite the approval process for power plants, Davis spokesman Steve Maviglio said. ??"Hindsight is always 20-20," he said. "We weren't having blackouts in '99, so it didn't pop up on anyone's radar." ??Summer 2000 took care of that, hitting like a sonic boom. ??Hot weather caused consumption to jump almost 4% year-over-year, double the decade-long average. Peak demand from May through August was consistently about 10% higher than in summer 1999, averaging an extra 3,200 megawatts per day--enough to power more than 3 million homes. ??On Aug. 16, the day with the year's highest peak, Cal-ISO's so-called spinning reserve--the amount of capacity that can be brought on line within 10 minutes--was 1.2%. ??The causal link between heightened usage and other pressure signals, from higher spot-market prices to staged emergencies, seemed clear. ??Or was it? Peak demand still fluctuated within a narrow range only marginally above long-standing forecasts. The so-called superpeak--the moment of highest usage on summer's most brutal day--was lower than in uneventful 1999. ??Moreover, after summer's heat ebbed, California's consumption tapered. Still, the power crisis' other symptoms raged on. ??In November and December, wholesale power prices soared, California paid far more for natural gas than the rest of the nation, and the first rolling blackouts hit. Yet peak demand traced an almost identical line as it had the year before, averaging a few megawatts less. ??Peak demand was down again from January to April when rolling blackouts returned, averaging about 1,600 megawatts less than in the same stretch of 2000, which passed without a single emergency. ??State officials were quick to blame suppliers, but many industry analysts point to the region-wide supply-demand equation. ??These forces may continue to dominate, they acknowledge, even though Californians have cut back on consumption faster and more this year than state officials had dared to hope. ??In May, peak demand dropped 10.4% below its 2000 level and consumption fell 11%, marking the fifth straight month of reductions. ??Electricity Demand ??Electricity use in California has shown no dramatic shifts over the last several years, increasing at an average of about 2% a year. In the last year, its predictability has stood in stark contrast to the gyrations of supply and wholesale prices. Total consumption of electricity in the state, in thousands of gigawatt-hours: ??* ??Source: California Energy Commission GRAPHIC: GRAPHIC: Electricity Demand, Los Angeles Times LOAD-DATE: June 25, 2001 ?????????????????????????????11 of 141 DOCUMENTS ??????????????Copyright 2001 Knight Ridder/Tribune Business News ??????????????????????Copyright 2001 San Jose Mercury News ????????????????????????????San Jose Mercury News ????????????????????????????June 25, 2001, Monday KR-ACC-NO: SJ-POWER-PLANT LENGTH: 1356 words HEADLINE: Pending Power Plants in California Face Some Problems BYLINE: By Steve Johnson BODY: ??SAN JOSE, Calif.--Although California's summer energy outlook seems to be brightening, state leaders still are counting on new power plants to boost competition and lower electricity prices in years to come. ??They may end up disappointed. ??Even with 42 new power plants in the works before the California Energy Commission as of early last week, the state can't be sure of how much power they will produce or what prices they will charge, experts say. That could prove troublesome, since 70 percent of the power the state plans to buy through long-term contracts is supposed to come from these new plants. ??Nor is there any guarantee of the price these plants might charge for the rest of their power on the spot market, despite last Monday's order by federal regulators to generally limit spot prices across the West. ??Like much of what has happened since the state passed deregulation, the future appears cloudy. Here's why: ??-- Critics say the price caps ordered Monday by the Federal Energy Regulatory Commission contain loopholes that could allow California's electricity costs to soar on days when it is desperate for power. And when the Mercury News asked 12 of the companies involved in the recently approved or pending power plants if they could promise that their spot market prices would be cheaper than what California has been paying recently, none could. ??-- Of the 25 mostly private entities involved in these new power plant projects, only six are generators new to the state, and most of their plants are relatively small. That may slow the development of a more competitive electricity market, which state officials say is needed to lower prices. ??-- More than a third of the electricity to be produced by these new operations would be controlled by firms accused in recent lawsuits or governmental actions of questionable pricing and, in some cases, outright gouging. State officials claim that some of these companies, among other things, have shut down their plants when electricity demand was high to artificially crimp supplies and inflate prices. ??-- Some experts doubt that all of the proposed plants will get built. Several power companies acknowledged that the intense criticism of them by California officials and uncertainties over the economic viability of owning plants here could cause them to delay or even abandon their projects. Others suspect these firms eventually may cancel some of the plants they have proposed, to keep power in short supply and prices high. ??"I'm concerned," said California Public Utilities Commissioner Carl Wood, when asked about the makeup of the firms proposing the new plants. "It's the same cartel. We will have more generation, but we will have the same players owning and controlling it." ??Such comments irk power suppliers, who have repeatedly denied breaking any laws or regulations governing the sale of wholesale electricity. Many of these entrepreneurs find it particularly galling that the very state officials accusing them of price gouging are begging them to build plants in California. ??Few politicians have been as vehement in their denunciation of electricity suppliers as Gov. Gray Davis. Yet he is among those relying heavily on the new power plants these companies are developing to help pull California out of its energy crisis. ??"Eventually when supply and demand come back into something approaching balance, there will be genuine price competition," Davis said in December. He repeated the point earlier this month, proclaiming that "by the fall of 2003, we will have more power than we need. That will solve the long-term problem." ??Davis isn't alone. Although power costs have fallen in recent weeks and federal officials may impose tougher price controls on electricity, the assumption that more plants is the key to solving California's troubles is taken as gospel by many state and federal officials. ??It seems logical enough. More power presumably would not only ease the threat of blackouts, but relieve California of the need to pay exorbitant prices on days when electricity is in short supply. ??But calculating how much more power the state will wind up with, based on how many plants are on the drawing board, is risky, say some state regulators and consumer advocates. ??"I have no confidence at the moment that a majority of those new plants will ever materialize," because power companies are likely to maintain an electricity shortage to keep prices high, said Michael Shames, of the Utility Consumers Action Network. "Why would they want to change what they've got? They've got a sweet deal." ??Another reason plants might not get built is politics. Several firms with projects in the works claimed that threats by state officials to seize their plants or impose a windfall profits tax on their sales had made it harder to obtain financing. ??"Every time these politicians start spouting off to improve their own political careers, they don't realize the damage they're doing," said Gary Ackerman of the Western Power Trading Forum. ??Just this month, Mirant Corp. of Atlanta received state permission to build a 530 megawatt plant in Contra Costa County -- enough to supply power to about 400,000 homes -- and it has applied to build a similarly-sized generator in San Francisco. But its spokesman Chuck Griffin said both projects are on hold, until Mirant feels more comfortable about the state's political and economic climate. ??"We have to be able to determine that it's going to be a viable investment," he said. ??Even if all 42 plants are built, many of the companies proposing them were skittish about promising cheaper prices. They said it depends on such things as the future cost of natural gas, which many of their plants use for fuel. ??One firm California is counting on is Calpine Corp. of San Jose, which already commands a modest fleet of small plants in the state and is developing nearly one fourth of the 42 new plants. ??Although Calpine has earned huge profits in recent months, it has a relatively good reputation among consumer advocates and state investigators who have reviewed its confidential power sales data. Moreover, Calpine's name is conspicuously absent from recent lawsuits and federal legal filings that have either accused other firms of gouging or questioned the reasonableness of their prices. ??Much of the power to be generated from Calpine's new plants will be sold in long-term contracts to the state, according to company spokesman Bill Highlander. But like other suppliers, he was vague about what it would charge for the rest. ??"It kind of depends on a whole number of factors," Highlander said, including how much people conserve and how much power California can continue importing from other states. Since no one can predict such things today, he added, "that's what makes it so difficult." ??If anyone should be concerned about the price of power it's the folks at PG&E Corp., who have blamed high electricity costs for forcing their utility -- Pacific Gas & Electric Co. -- into bankruptcy. But even they wouldn't speculate about how much they would charge for the power from their 1,048 megawatt plant in Kern County, which is to be built by their unregulated affiliate, PG&E National Energy Group. PG&E's energy trading arm is among the suppliers accused of questionable pricing practices, although PG&E officials have denied any wrongdoing. ??By the time the Kern County plant is done in two years, "if we have a situation where we are seeing a lot more generation come on line in the state, economic law should dictate that prices will come down," said PG&E Corp. spokesman Greg Pruett. But that's not for certain, he said, adding, "we've all gone to school about how topsy-turvy the market could become." ??Like every other generator, PG&E doesn't plan to spend a lot of money building a plant just to wind up giving away its electricity. "Obviously," Pruett said, "everyone who invests in these is doing so to earn a profit." ??----- ??To see more of the San Jose Mercury News, or to subscribe to the newspaper, go to http://www.sjmercury.com JOURNAL-CODE: SJ LOAD-DATE: June 25, 2001 ?????????????????????????????12 of 141 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ?????????????????????JUNE 25, 2001, MONDAY, FINAL EDITION SECTION: NEWS; Pg. A1 LENGTH: 720 words HEADLINE: THE ENERGY CRUNCH; $9 billion showdown over power; State delegation seeking refunds SOURCE: Chronicle Staff Writers BYLINE: Lynda Gledhill, Christian Berthelsen BODY: A critical showdown in California's energy crisis starts this morning, as state officials meet with energy companies to demand $9 billion in refunds. ???A 15-day settlement conference, ordered as part of the Federal Energy Regulatory Commission's decision last week to put price controls on wholesale electricity prices, will bring together the parties that have been squabbling for the past year. ???"We are going to Washington with one goal, and that is to bring back $9 billion," Gov. Gray Davis told reporters yesterday. "The fact is that people have taken advantage of the market, gamed the system and ripped people off." ???But Davis' crusade may be dampened by challenges to the study the state used to arrive at the $9 billion figure and by a FERC mediator's prediction that California will walk away with less than it is demanding. ???The Democratic governor's figure is based on an update of a March study by the California Independent System Operator, which manages the sate's power grid. Some energy experts argue the study is flawed, but the ISO stood firm behind its methodology yesterday. ???Curtis L. Wagner Jr., the FERC administrative law judge who will oversee the meeting, said in an interview with The Chronicle yesterday that he was optimistic a settlement would be reached. ???Wagner said the $9 billion "seems a little high. And the generators' numbers seem low. We'll probably come out somewhere in between." ???The veteran mediator, who spent yesterday reviewing spreadsheets submitted by the parties, said he will look at applying last week's commission price control order back to October. ???"I think we should put the refund issue to rest," Wagner said. "I'm sure we can agree on a structure that is fair to everybody." Enron Corp, Reliant Energy Inc., Duke Energy Corp., Williams Cos., Dynegy Inc. and Mirant Corp. are among the companies facing allegations of illegally overcharging California. The companies say the high prices were a result of the high costs of natural gas used to generate power. ???"There has been no evidence to suggest that suppliers bilked anyone," said Mark Stultz, a vice president of the Electric Power Supply Association, which represent the generators. ???But Davis insisted that the state will recover the full amount it is asking. ???"Under the law, FERC has no discretion," he said. "It is mandated to refund excessive charges, if prices were found to be unjust and unreasonable, which they were." ???The governor, however, acknowledged that some of the money he is demanding may be owed by municipal utilities that do not fall under FERC's jurisdiction. ???Davis adviser Nancy McFadden said municipal utilities such as Los Angeles Department of Water and Power and BC Hydro that sold electricity to the state have been invited to join the talks as well. ???"We need the FERC to lay the basis to seek refunds from private generators, and use that as a basis to seek refunds from public generators," she said. ???California could face an obstacle in its case for the full repayment it seeks. Under FERC rules, overcharges can only be authorized after a formal investigation is ordered, which in this case started on Oct. 2, 2000. If Wagner sticks to that time frame, it eliminates the summer 2000 months when prices first began to spike. ???"There is no question we can order refund from that (October) date forward," Wagner said. "Legally, there may be some question before that date." ???But Wagner said a FERC regulations may not necessarily rule out broader refunds. "That's the great thing about a settlement -- you can do anything," he said. ???If no settlement is reached in 15 days, Wagner will forward his recommendations to the full commission for its approval. California will then have the option of pursuing the matter further in court. ???California's delegation will be led by Michael Kahn, a San Francisco lawyer who chairs the ISO. ???Davis also meets today in Sacramento with new FERC Commissioners Patrick Wood and Nora Brownell to discuss the refunds and the high cost of natural gas in the state. ???Wood, who is expected to be named chairman of the commission in the fall, has expressed his support for finding solutions to California's power woes.E-mail the reporters at lgledhill@sfchronicle.com and cberthelsen@sfchronicle.com. LOAD-DATE: June 25, 2001 ?????????????????????????????13 of 141 DOCUMENTS ?????????????????Copyright 2001 The Chronicle Publishing Co. ?????????????????????????The San Francisco Chronicle ?????????????????????JUNE 25, 2001, MONDAY, FINAL EDITION SECTION: BUSINESS; Pg. B1 LENGTH: 1938 words HEADLINE: BECHTEL HOLDS ITS OWN; Despite economic downturn, S.F. construction giant's revenues remain steady SOURCE: Chronicle Staff Writer BYLINE: Todd Wallack BODY: The economy is skidding. Tech firms are shutting plants and reining in expansion plans. And two major engineering and construction firms, Stone & Webster and Washington Group (formerly Morrison Knudsen) sought bankruptcy protection during the past 13 months. ???So, it would come as no surprise to hear that the world's largest engineering and construction firm, San Francisco's Bechtel Group, is getting pinched by the downturn. ???Only it isn't. ???Despite the slowdown in the economy and in some areas of construction, Bechtel and many rivals are still busy upgrading cellular networks, building railroads and airports, and completing new power plants. ???"Our guys are working 80 to 100 hours a week completing deals," said John Siegel, vice president of marketing and strategy for Bechtel's power plant construction division. "You walk around at 9 p.m. and everyone is still here." ???Overall, Bechtel's sales dipped 5 percent last year to $14.3 billion, but that's still up 13 percent from 1999 and a healthy 74 percent from 1996. The company said operating margins improved last year. And employment jumped by a quarter during the past five years to 41,000 worldwide, including 1,300 in San Francisco. Both employment and sales are holding firm so far this year. (The privately held firm doesn't release earnings figures.) ???Bechtel isn't alone. Shares in Fluor, the second-largest engineering and construction firm, and Jacobs Engineering Group nearly doubled in value during the past 12 months. And some analysts are bullish on the future. ???"We could be on the front end of a multiyear up-cycle," Merrill Lynch analyst Fritz von Carp predicts. ???CONTRARY CYCLES ???Although the engineering and construction industry has long been vulnerable to sharp downturns, von Carp said the cycles often differ from the rest of the U.S. economy. ???For instance, high energy prices usually spell bad news for most domestic businesses. But an energy shortage could help spur a boom in new power plants, refineries and pipelines -- lifting the petroleum sector out of a decade-old funk. That has long been a major business for firms such as Bechtel. ???In addition, von Carp points out that government agencies typically garner a large share of transportation revenue from gasoline taxes -- which aren't as sensitive to downturns as income taxes and capital gains. California and other states have also increasingly walled off those funds, so politicians can't raid the transportation war chests to pay other bills when budgets are tight. ???Government agencies and big businesses also tend to initiate major projects when times are good. But because the projects often take years to start and complete, they often wind up ramping up after the economy has already slid into recession. "It is really a late cycle," von Carp said. ???This isn't to say that Bechtel's business is humming across the board. ???Bechtel Executive Vice President Jude Laspa said sales remain lackluster in its mining and chemical division. (And despite von Carp's predictions of an upswing in the petroleum industry, Laspa said sales haven't picked up so far.) ???"We have some very robust businesses, and some that are in a cyclical downturn," Laspa said. ???TIGHT MARGINS ???Engineering and construction companies also have to be content with lower profit margins than those in many other industries. Like its rivals, Bechtel typically pockets about 3 to 5 percent of revenues after taxes, Laspa said. Operating margins are closer to 7 to 9 percent. (By contrast, anything under 20 percent is considered anemic in the newspaper industry.) ???"This is a low-margin business," von Carp said. ???Industry players are also increasingly taking on more risk, bidding on fixed-price contracts to compete. In the past, many firms charged by the hour and profits soared when projects became mired in delays. Now that companies are getting only a lump sum for a development, major setbacks in a project or two could sink a firm. ???Stone & Webster of Boston, for instance, filed for Chapter 11 bankruptcy protection last year, largely because of delays in building a gas-fired power plant in Tiverton, R.I. Shaw Group later acquired most of the firm's assets. ???Meanwhile, Washington Group of Boise, Idaho, foundered after it acquired Raytheon's Engineers and Constructors unit, igniting a nasty court battle. Washington accused Raytheon of concealing problems with several of the projects and demanded compensation; Raytheon blamed Washington for mismanaging the projects and insisted it owed nothing. ???Although Bechtel doesn't let outsiders review its books, analysts say they believe the firm has largely avoided such problems and is financially solid. Bechtel executives point out that the company is 50 percent larger than its next-biggest competitor. ???"Bechtel is considered in the industry to be the pre-eminent engineering and construction company," von Carp said. "It is a very good competitor with a strong franchise in many markets." ???ON TOP IN TELECOM ???Bechtel has also enjoyed some luck lately. ???For instance, some telecommunications equipment firms are doing so poorly that one analyst compared it to a "nuclear winter." Dozens of data service providers, such as NorthPoint Communications in Emeryville, have shut down. Others have severely reined in their expansion plans. ???But Bechtel's revenues are up 20 to 25 percent this year. George Conniff, president of Bechtel's telecommunications and industrial business unit, said his firm mainly serves financially solid firms, such as AT&T Wireless, which are still going ahead with plans to add 8,000 new towers, despite the slowdown. He also said the unit has picked up some consulting business abandoned by equipment firms trying to narrow their focus to weather the downturn. ???"We're having a great year," Conniff said. "When the river is muddy, the fish start to bite." ???But no part of the business is doing as well as Bechtel Power. ???A POWERHOUSE IN ENERGY ???"The power business is doing spectacular," von Carp said. "It is the strongest part of the market now, bar none." ???Siegel said the company has 22 plants under construction worldwide -- up from about nine four years ago -- and many more in the pipeline, particularly in the United States. Siegel said the unit's revenue rose 15 to 20 percent last year and is on pace to match that this year. He said the firm could probably land even more business if it had the ability to pursue and handle more projects. ???Through another unit, Bechtel is also investing in power plants under development in Hayward, Pittsburg and San Jose. The company struck a deal with San Jose's Calpine in 1998 to spend $1 billion building several plants in the Bay Area. Under the deal, the companies will jointly own the plants and split the profits down the middle. Because of the strong demand for electricity in California, Bechtel spokesman Jeff Leichtman said it will probably wind up spending at least $500 million more than originally announced. ???Bechtel doesn't own any existing plants in the United States, so it isn't among those accused of gouging consumers in the recent energy crisis. But that's partly an accident of fate. ???The firm's investment arm teamed with PG&E in the late '80s to start building plants. But in 1996, PG&E offered to buy out Bechtel for most of the U.S. operations; Bechtel sold the rest of its U.S. stakes shortly thereafter. ???But Bechtel kept the shares in its overseas plants and bought out PG&E a year later. Bechtel now operates the foreign plants through a division called Intergen. It also owns more than half of Nexant, an energy consulting firm based in San Francisco. ???Now, at a time when many Bay Area firms are being hurt by the energy crisis, Bechtel stands to cash in. ???And Laspa said word is already leaking out. He said the firm is getting inundated by resumes. "Potential employees know where the business is strong," he said. ??-------------------------------------------------------------------------- ??---------------------------------------------------------- ??BIG JOBS ???Bechtel has completed more than 20,000 projects and has 1,100 under way in 66 countries. Here are some notable landmarks Bechtel helped build: ???-- Completed ???Hoover Dam ???Bay Area Rapid Transit subway ???San Francisco Museum of Fine Arts building ???Bay Bridge ???Chunnel linking France to England ???Hong Kong International Airport . ???-- Current ???Boston Central Artery (Big Dig) ???AT&T Wireless (adding 8,000 cell sites) ???Korea High-Speed Rail, South Korea ???Antamina Copper and Zinc Mine, Peru ???Alcan Alma Smelter, Quebec ??---------------------------------------------------------------- ??CHART (1): ??BECHTEL AT A GLANCE ???Bechtel is the world's largest engineering and construction firm. Despite a U.S. economic downturn, the San Francisco company's sales and employment remain relatively healthy. . ???Headquarters: San Francisco ???Local employment: 1,300 in San Francisco and 2,000 in California ???Founded: 1898 ???Stock: Privately held ???CEO: Riley Bechtel . ??-- Revenues ???Bechtel gets most of its revenue from building power plants and running government facilities. . ???Power ??????????????????????????????????????$3.1 billion ???Civil ???(bridges, tunnels, airports, etc.) ?????????$2.1 billion ???Petroleum and chemicals ????????????????????$1.5 billion ???Pipeline ???????????????????????????????????$1.2 billion ???Mining/metals ??????????????????????????????$1.7 billion ???Telecom ????????????????????????????????????$1.5 billion ???Bechtel National Inc. ???(Federal gov.t facilities management) ??????$3.1 billion ???Sources: Bechtel ??---------------------------------------------------------- CHART (2): ??BECHTEL LEADS THE PACK ??-- Construction/Engineering Firms ?Rank/Company/HQ ???????????????????????????????Revenue(x) . ???1. Bechtel Group Inc., San Francisco ?????????$12.42 ???2. Fluor Corp., Aliso Viejo (Orange County) ???$7.83 ???3. Kellogg Brown & Root, Houston ??????????????$5.34 ???4. The Turner Corp., Dallas ???????????????????$5.85 ???5. CENTEX, Dallas ?????????????????????????????$5.4 ???(x) - In billions; includes revenue from construction/engineering contracts only. ?. ???-- Top Power Construction Firms ?Rank/Company ??????????????????????????????????Revenue(y) ??1. Bechtel Group Inc. ?????????????????????????$1,100 ???2. Duke Engineering & Services ??????????????????$303 ???3. Sargent & Lundy ??????????????????????????????$292 ???4. Black & Veatch ???????????????????????????????$241 ???5. Stone & Webster Engineers and Constructors ???$234 ?(y) - In millions; Includes revenue from energy contracts only. ???. Sources: Engineering News-Record ???E-mail Todd Wallack at twallack@sfchronicle.com. GRAPHIC: PHOTO (3), CHART (2): SEE END OF TEXT, (1) Bechtel and Calpine collaborated in the construction of Pittsburg's Delta Energy Center power plant., (2) The Delta crew worked on the selective catalytic reduction system that powers the generators. / Photos by Lance Iversen/The Chronicle, (3) The Bay Bridge is among many landmarks that have been Bechtel projects. / Darryl Bush/The Chronicle LOAD-DATE: June 25, 2001 ?????????????????????????????15 of 141 DOCUMENTS ????????????????Copyright 2001 News World Communications, Inc. ?????????????????????????????The Washington Times ?????????????????????June 25, 2001, Monday, Final Edition SECTION: PART A; COMMENTARY; Pg. A13 LENGTH: 917 words HEADLINE: Price cap perils . . . and peripatetics BYLINE: Donald Lambro; THE WASHINGTON TIMES BODY: ??Republican Whip Tom DeLay couldn't believe what he was hearing at a House Republican leadership meeting last week after the Federal Energy Regulatory Commission voted to put into place stricter controls on Western electricity prices. ??Almost all of the Republican leaders around the table, who were opposed to price caps, were happy with FERC's decision because it pulled the political rug out from under the Democrats. ?"The mood around the table was positive. ?FERC had robbed the Democrats of a big issue - that we were doing nothing to control higher energy prices for consumers," said a Republican House leadership official who attended the meeting. ??The independent regulatory agency's decision did what President Bush and Republican leaders had publicly fought but were privately encouraging FERC to do. ?While Republican leaders do not believe the price controls will alleviate California's energy shortage, they were delighted by its immediate political result. ?It pricked the price-cap balloon that had been rapidly growing on Capitol Hill. ?Price-control Democrats, among them Sen. Dianne Feinstein of California, have withdrawn their price-cap bills while they wait to see if the agency's action will work. ??The administration, which said for months that price controls would only exacerbate California's energy problems, was nevertheless happy to see the Democratic offensive collapse. ?Under advice from political strategist Karl Rove, Mr. ?Bush embraced FERC's action, maintaining that it did not impose price controls, although everyone knows that is exactly what it did. ??Mr. ?DeLay was not buying the party line, and said so. ?While he did not directly criticize the White House's acquiescence - or its behind-the-scenes lobbying for FERC's action - he put out a strong statement reminding his party that price controls cannot and will not work. ??"Let's be clear," he said. ?"In every place they've been tried, big-government price controls have failed to achieve the results their supporters promised. ?They failed when Republicans used them. ?And they failed when Democratic presidents used them. ?All government price controls can offer is the specter of longer and more frequent blackouts." ??"The people of California are suffering today because the demand for electricity exceeds the available supply. ?Until that fundamental imbalance is resolved, their problems will continue," he said. ??Mr. ?Bush argued that FERC's order "was not talking about firm price controls. ?. . . They're talking about a mechanis
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