Lobbyists, advocates battle for leverage on electricity issue

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The Associated Press

Rival lobbyists swarmed through the Capitol, battling to protect their interests as lawmakers wrangled over a multbillion-dollar scheme to stabilize California’s deregulated electricity market.

The rescue plan changed hourly Tuesday and carried huge stakes, involving years of energy purchases affecting millions of Californians and their pocketbooks.

It also drew attention from agricultural advocates, power plant and utility lobbyists, consumer activists, state bureaucrats, company executives, business experts and consultants seeking to buttonhole lawmakers and pitch their positions.

The Capitol’s corridors were crowded with advocates – a common sight when major issues confront the Legislature. And that crowd is likely to get larger as floor votes near on the power-purchasing plan and an omnibus proposal to overall the state’s turbulent electricity industry.

In one Senate hearing, lawmakers spent hours wrestling over utility rates, an exercise that irked more than one lobbyist.

“Ratemaking? Why are they getting into ratemaking? It’s like the animals have control of the zoo,” said one utility advocate, flanked by colleagues outside the chambers.

The most important meetings weren’t in hearing rooms but took place behind closed doors in party caucuses and in the offices of the governor and Assembly speaker. That’s where a utility bailout was being hammered out, according to consumer activists.

“Rolling blackouts and the daily threats of bankruptcy are political leverage, and the starting point is a bailout for utilities,” said Douglas Heller of the Foundation for Taxpayer and Consumer Rights.

“The utilities are being told, ‘We’ll get you your bailout, we’ll get you your rate increase.’ I’m afraid that’s the politics of today,” Heller said.

Lobbyists for the energy producers see the issue differently.

They want two things: to do business with solvent utilities to ensure payment and to set up long-term contracts.

“In the short term, we want a solution that will allow the utilities to become credit-worthy entities,” said Richard Hyde, an employee of North Carolina-based Duke Energy. Hyde has been in Sacramento for the past three weeks advocating his company’s interests.

For farmers, the electricity crisis raises the specter of power cutoffs at critical times that could kill produce, such as citrus crops needing protection from cold weather.

“What we want are policies that lead to reliability of supply and stability of price,” said Ron Liebert, an advocate and energy expert for the California Farm Bureau Federation.

“The worst thing is when prices go all over the place, and it’s very difficult to plan,” he added.

The state’s two huge investor-owned utilities, although represented by their own lobbyists, brought in their own big guns – chief executives John Bryson of Southern California Edison Co. and Gordon Smith of Pacific Gas and Electric Co. Both huddled privately with Gov. Gray Davis.

“What do they need lobbyists for when they can send in their CEOs?” a senior administration official said.

But in the end, some say all the lobbying efforts may not amount to much.

“I don’t think the lobbyists from the utilities, and certainly the out of state generators, are getting much sympathy,” said Assemblywoman Hannah-Beth Jackson, D-Santa Barbara. “While we support profits, we don’t support profiteering. They have really taken advantage of us.”

Consumer Watchdog
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