Power company pitches short-term plan for energy crisis

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The Associated Press

Officials from Reliant Energy Inc., one of the energy companies widely blamed for the power crisis in California, met with Gov. Mike Leavitt Monday to pitch a solution for this summer’s energy shortages.

The electricity and natural gas marketer wants to allow large industries to sell their unused power to any other company in the West. For example, a Utah company could close during peak energy consumption hours and sell power it already had contracted for to a company in Arizona, said Stephanie Newell, the company’s vice president of governmental affairs.

The plan would only be a short-term solution for the summer, she said, adding that Reliant would not profit from it.

The officials presented their plan during a meeting arranged by attorney Bob Miller, a former Nevada governor. The plan is still just a concept that the company came up with about a month ago, but Reliant officials already have pitched the idea to a half dozen Western governors, Miller said.

California again will be significantly short of power this summer, said John Stout, a Reliant vice president. Water supplies to generate electricity through hydropower in the Pacific northwest also are low.

“Hydroelectricity is like a big battery, and we’re going into summer with that battery half charged,” Stout said.

The plan still lacks a third party to handle the business deals, he said.

After the meeting, Leavitt said that the plan appears to be simple but would probably be difficult to put into practice. But he said industry already does this on a local level.

“It’s an intriguing idea, but its viability will be determined in the coming months,” he said.

Critics of the Houston-based company are skeptical of the company’s gesture. Consumer advocate Doug Heller, with the Los Angeles-based Foundation for Taxpayer and Consumer Rights, said Reliant is trying to deflect from the allegations it withheld power from Californians.

Reliant wants to avoid the public and political backlash that occurred in California. As they pursue deregulation schemes around the country, they want to go in as friends and not enemies,” he said.

“It’s the art of deception, while they appear to be encouraging the increase of supply in one instance, they have been abusing their control of supply in another instance,” Heller said.

Heller also warned other Western states to be leery of Reliant.

“We urge political leaders across the West to take heed when Reliant shows up at their door because it’s unlikely they would do anything other than to increase their profits,” he said.

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