Bailout Watch #36 – May 02, 2001

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BAILOUT WATCH: Keeping an eye on the energy industry and the politicians

Bailout Watch #36 – May 02, 2001

Deregulation creates a new "market." There’s a new gang in Sacramento and they have money to burn, which is why Sacramento lobbying firms are busy, busy, busy. The deregulation disaster has created a new "market" for lobbyists hired to protect the energy pirates as they get richer and richer off of California. The goal: protect the loot. But instead of walking into the Capitol with their cowboy boots and 10 gallon hats, the energy companies are hiring locals to do the work. (Who says the wholesale energy companies aren’t doing anything positive for the California economy?) The unregulated power generators spent more money on wining, dining and testifying in the first three months of 2001 than the industry spent in all of last year. The graph below illustrates the relationship between energy companies’ windfall profits and their ascendancy in Sacramento:

Expenses Q1 2001
lobbying expenses per quarter 2000^
Q1 2001
financials compared to Q1 2000
Duke Energy $62,729.07 $14,473 51% increase in earnings per share
Dynegy $32,261.04 $6,003.75 Profits doubled
Enron $95,023.77* $49,946.11 Revenues quadrupled
Reliant $99,261.04 $6,380.75 Earnings from electricity generation up 143% over last year
Calpine $178,035.20 $3,750 Q1 2001 earnings = $94.78M
Q1 2000 earnings = $18.12 M
TOTAL $377,969.92 $80,553.61  

^ Based on 2000 total lobbying expenses divided by 4
* Includes lobbying expenses of Enron spin-off New Power Company (Enron owns 45% of the company)

Definitions Department. For most of us, "broke" means "out of money." But not for the utilities. Edison spent $340,038.53 lobbying the Governor, lawmakers and other officials in the first three months of 2001. It costs a lot of money to have lobbyists walk around the state Capitol claiming they are so broke they can’t pay their bills. And PG&E, not to be outdone, spent a whopping $644,201.22 in the three months before it actually filed for bankruptcy protection. That’s more than 2/3 of its entire lobbying expenses for all of last year. (Sempra, which spent $192,442.33 lobbying, nearly what it spent in all of 2000, is not exactly going broke with a 58% increase in net income over Q1 2000, largely due to its energy trading arm: an in-house pirate.) The utilities’ $1.2 Million in lobbying expenses are geared towards a $12 Billion legislated bailout to be paid by ratepayers.

Judgment Day
552 Days Until November 5, 2002

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