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Enron Mail |
It's no coinicidence that there're three I's in polItIcIan. What, you live
in Sacramento now? When're we going to play? <From: Jeff.Dasovich@enron.com <To: eldon@direcpc.com, psellers@Haas.Berkeley.EDU, cameron@perfect.com, <scottwl@hotmail.com <Date: Wed, 11 Jul 2001 12:03:33 -0500 < <Dan Walters: Davis plays in a virtual world while the energy reality <continues < < <(Published July 11, 2001) < < <California still has a very real and very severe energy crisis, to wit: < < <(Embedded image moved to file: pic08526.gif)The state is still running up <massive debts as it pays more for power than it can recover from ratepayers <and is having trouble borrowing billions of dollars to cover the debt. < < <(Embedded image moved to file: pic13357.gif)There is a strong possibility, <perhaps a probability, that when summer's heat truly descends, there will <be severe power blackouts as air conditioners demand more juice than <California can generate or buy. < < <(Embedded image moved to file: pic29337.gif)One major utility, Pacific Gas <and Electric, has filed for bankruptcy protection and a second, Southern <California Edison, is on the brink of joining it. < < <There is, however, a virtual energy crisis consisting of political spin, <media leaks and made-for-television buzz words -- and it is rapidly <becoming dominant, while the real situation fades into the background. < < <This week's comic opera proceedings before a Federal Energy Regulatory <Commission administrative judge in Washington had little to do with reality <and everything to do with the virtual version. < < <Gov. Gray Davis and other officials demanded $8.9 billion in refunds from <the generators and brokers who have been selling California power for the <past year, alleging that California is, in Davis' words, "being gouged and <ripped off." But the number itself was more or less plucked out of thin air <-- an arithmetic exercise by the state power grid's traffic controller not <intended for a refund proceeding. And while Judge Curtis Wagner saw it as <unrealistic, Davis and other state officials insisted on its validity. < < <"There are refunds due that total hundreds of millions of dollars and maybe <a billion dollars," Wagner said as a final negotiating session collapsed. <But that's a far cry from the $8.9 billion that Davis insists is due. "If <you think California is going to settle for $1 billion in refunds, we will <see you in court," Davis said Tuesday. < < <Why is Davis being so belligerent? Because it's good politics. Ever since <he began berating out-of-state generators and accusing them of ripping off <California, Davis' approval ratings have been climbing. If he settled for <substantially less -- the power generators probably would agree to a couple <of billion dollars to rid themselves of the matter -- Davis would be <embarrassed. Politically, he's served by continuing to portray himself as <fighting for California and against the out-of-state generators. < < <That it's more political construct than reality is indicated by another <event this week, Davis' release of state power purchase data from early in <the year -- numbers that were made public only because a judge told him he <had to do it. < < <Davis and his minions have been accusing Texas-based generators and power <brokers of particularly egregious price gouging -- clearly playing on <Californians' instinctive mistrust of anything Texan and implying that <Texan George W. Bush is a co-conspirator. But the power purchase records -- <which were released only to journalists willing to pay a stiff fee -- <indicate that less than 10 percent of California's power purchase dollars <were going to Texas and the private sellers, in general, charged the state <less than such publicly owned utilities as the Los Angeles Department of <Water and Power. < < <The clearly adverse position being taken by FERC and the purchase data that <undercut his jingoistic sloganeering are not, however, deterring Davis from <continuing to operate, at least for public consumption, in the melodramatic <virtual world. < < <One cannot, however, ignore reality forever. The likelihood of a <pro-generator decision from FERC means that there will be no easy out for <Davis, or for his pending deal to prevent Southern California Edison from <slipping into bankruptcy court. The Legislature has refused to act on the <Edison rescue plan while it awaited an indication of whether the utility's <debts would be slimmed down by FERC. < < <This week's farcical events make it more likely that the Edison deal will <stall out permanently in the Legislature and its creditors will force the <utility into bankruptcy court later this summer. That's part of that nasty <old reality that cannot simply be wished away. < < < <The Bee's Dan Walters can be reached at (916) 321-1195 or <dwalters@sacbee.com. < < < < < < <<< pic08526.gif << <<< pic13357.gif << <<< pic29337.gif << _________________________________________________________________ Get your FREE download of MSN Explorer at http://explorer.msn.com
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