California’s senators blast FERC for lack of action on refunds to state

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Copley News Service

WASHINGTON — California’s two Democratic senators blasted the Federal Energy Regulatory Commission on Wednesday, and called on the agency to support the state’s effort to recoup $8.9 billion in refunds from power companies stemming from the 2000-2001 energy crisis.

Following what she termed a disappointing hourlong meeting with FERC chairman Pat Wood III, Sen. Barbara Boxer also said she believes FERC officials who have not supported California’s effort for refunds should be ousted.

Boxer said she sent a letter to the White House asking the Bush administration to support California’s bid for the refunds and to seek resignations of FERC officials.

Sen. Dianne Feinstein said she called on FERC chairman Wood to use his authority to refund Californians for their losses and punish traders and companies that manipulated the Western market.

Neither FERC officials nor the White House would comment directly on either Boxer’s statements, made at a press conference, or Feinstein’s comments, made in a press release.

Although Boxer announced she has sent a letter to the White House, “I haven’t seen it yet,” said White House spokesman Ken Lisaius.

Referring to the Democrats’ criticism, he said the administration has maintained a record of trying to help Californians deal with the power crisis to “keep the lights on.”

California’s senators also reacted to recent disclosures about Enron Corp.’s manipulation of energy markets during the 2000-2001 power debacle. Documents show that Western customers were defrauded about $1.1 billion, according to documents.

Audiotapes and other records captured conversations among Enron traders who gloated about ripping off Californians, including poor grandmothers, the records show.

While Boxer said she was outraged at the disclosures, she said that Wood didn’t appear to have such a reaction.

During their closed-door meeting at her Capitol Hill office on Wednesday, Wood – a Bush appointee to the top FERC post – appeared defensive and defended his position to challenge California’s efforts to seek the refunds and renegotiate contracts, Boxer said.

Wood said that the commission was still reviewing records and had not made a decision, she said.

On Wednesday, a consumer group, the Foundation for Taxpayer and Consumer Rights, based in Santa Monica, Calif., also criticized Wood for “indifference” to Enron‘s gaming of California ratepayers.

“I am sorry to say that the agency responsible for protecting consumers from “unjust and unreasonable” electricity prices has failed miserably,” Boxer said. “It is now 2004 and not one dime of the $8.9 billion in refunds owed to California has been received. The FERC has also done nothing to order the renegotiation of long-term contracts.”

In a letter to Boxer sent June 7, Wood said that the commission is “pursuing Enron‘s misdeeds in every way possible.”

He also said that the commission “continues to pursue refunds or disgorgement of profits in other proceedings related to California’s electricity crisis, including the ongoing investigations into gaming by Enron and others.”

Feinstein criticized FERC’s decision in May that ordered California to pay Enron and other energy companies $270 million in refunds that were linked, she said, to the state’s efforts to stabilize the energy market.

“To ask Californians to repay energy companies $270 million after the fraud perpetrated against them is preposterous,” Feinstein said.

The criticisms of FERC officials come at a time when the Bush administration is pushing a new energy bill in Congress.

“It seems the chairman has not been moved to change his views even in light of the latest revelations of thievery by the electricity companies, which went from the top to the bottom,” she said.

But a White House spokesman took the opportunity to criticize Democrats who have not supported the president’s energy reform legislation now being considered by Congress. California’s senators have opposed the legislation.

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