?
National Public Radio (NPR), Morning Edition (10:00 AM ET) - NPR, May 18,
????2001 Friday, 618 words, California's power plan, ALEX CHADWICK, ELAINE 
KORRY (Quotes Smutny)

AP Online, July 18, 2001; Wednesday, 8:56 AM, Eastern Time, Domestic,
????non-Washington, general news item, 279 words, Pacific Sues Calif. Over
????Contracts, DAVID KRAVETS, SAN FRANCISCO

Contra Costa Times, July 18, 2001, Wednesday, STATE AND REGIONAL NEWS,
????K2631, 540 words, Consumers cashing in instead of cooling off, By Katie 
Oyan

Los Angeles Times, July 18, 2001 Wednesday, Home Edition, Page 7, 186 words
????, PG&E Sues State Over Contracts, From Bloomberg News, SAN FRANCISCO

Los Angeles Times, July 18, 2001 Wednesday, Home Edition, Page 2, 349 words
????, California; ; Trading, Wholesale Power Boost Duke's Earnings 27%, THOMAS
????S. MULLIGAN, TIMES STAFF WRITER

The Orange County Register, July 18, 2001, Wednesday, DOMESTIC NEWS, K1616,
????1230 words, Gov. Davis trying to turn energy crisis to political 
advantage,
????By John Howard

The San Francisco Chronicle, JULY 18, 2001, WEDNESDAY,, FINAL EDITION,
????NEWS;, Pg. A14, 808 words, Lawmakers devise rival bailout plans for 
Edison;
????Push to come up with alternative to bankruptcy before recess, Lynda 
Gledhill
????, Sacramento

Chicago Tribune, July 18, 2001 Wednesday, NORTH SPORTS FINAL EDITION,
????Editorial; Pg. 20; ZONE: N, 675 words, The (ho-hum) energy crisis






National Public Radio (NPR)
SHOW: Morning Edition (10:00 AM ET) - NPR
May 18, 2001 Friday

LENGTH: 618 words

HEADLINE: California's power plan

ANCHORS: ALEX CHADWICK

REPORTERS: ELAINE KORRY

BODY:

??ALEX CHADWICK, host:

??California's rushing to get new power plants up and running. ?In January,
Governor Gray Davis used emergency powers to speed the permit process. There 
has
been progress, but NPR's Elaine Korry reports probably not enough to avoid 
more
blackouts this summer.

??ELAINE KORRY reporting:

??Since January, California energy regulators have been slashing red tape to
speed new power plants online. ?Their tracking 180 separate projects. Bob
Thurkelsen, who overseas permitting at the California Energy Commission, says
the governor's emergency directive has already paid off.

??Mr. BOB THURKELSEN (California Energy Commission): And that has allowed us
to, so far, permit 450 megawatts of new generation in a 21-day period.

??KORRY: In a few cases, even quicker than that. ?Jim Michael is the president
of Alliance Power, based in Denver, which sprinted through its permit process 
in
under three weeks.

??Mr. JIM MICHAEL (Alliance Power): Well, we're pouring concrete. We're on
schedule, so we're gonna have power plants operating this summer.

??KORRY: Alliance is building two small generators in Southern California.
Michael says permitting projects that used to take months were, instead,
completed in a day or two, allowing the company to meet critical deadlines.

??Mr. MICHAEL: It was essential. ?Without that streamlining, these projects
would have gone away. ?The turbines would have been sold to other projects
outside of California and so we would have essentially failed.

??KORRY: Yet there's still a major hitch. ?Despite the speedup in permitting,
California will still fall far short of the governor's initial goal. ?He 
wanted
5,000 new megawatts of electricity, enough to power five million homes, to 
come
online by July 1st. ?In a worst-case scenario, that's how much additional 
supply
the state would need to keep the lights on this summer. ?Yet only half that
amount, 2,500 megawatts, will be up and running by July. ?Jan Smutny-Jones 
heads
the industry lobbying group the Independent Energy Producers Association. 
?He's
not surprised by the shortfall.

??Mr. JAN SMUTNY-JONES (Independent Energy Producers Association): We said at
the time that was a very ambitious goal. And we'll see how it plays out.

??KORRY: Smutny-Jones says blackouts are a near certainty this summer. Their
severity will depend on a number of unknowns. ?How hot will it get this 
summer?
How much more can Californian's skimp on electricity? ?And how much wattage 
will
the power wholesalers themselves take off line? Power producers have been
charged with deliberately shutting down plants to keep prices high. 
Smutny-Jones
has a different explanation for the down time.

??Mr. SMUTNY-JONES: California's electric power system is rapidly aging. We
have not built a power plant of an appreciable amount in over a decade. ?And
there--while there's power plants being built now, the average age of these
power plants is in excess of 36 years old. ?That's the average age, which 
means
that a significant amount of the fleet is older than that. ?They break down.

??KORRY: The industry, itself, is partly to blame for the aging fleet. The
Energy Commission did license small generators during the 1990s. And if bigger
ones weren't built, it's largely because the energy producers, themselves,
balked at building them. ?Chris Seiple, with RDI Consulting, says construction
slowed everywhere; that is, until last year. ?Since 2000, he says, 90,000 new
megawatts of energy have come online nationwide. ?That's more capacity in two
years than was built during all of the 1990s. ?And now comes the Bush national
energy policy, urging even greater production. ?According to Seiple, we could
wind up with too much of a good thing.

??Mr. CHRIS SEIPLE (RDI Consulting): So we really expect that in--What?--50
markets we will go from a situation of having shortages to having too much
supply.

??KORRY: In yesterday's speech, President Bush repeated the
administration's claim that the nation will need at least 1,300 additional 
power
plants over the next two decades. ?Seiple says an over supply would drive down
prices, hurting the power wholesalers, but lower energy costs would suit most
ratepayers just fine. Elaine Korry, NPR News, San Francisco.

??CHADWICK: It's 19 minutes past the hour.

LOAD-DATE: July 17, 2001

AP Online

????????????????July 18, 2001; Wednesday 8:56 AM, Eastern Time

SECTION: Domestic, non-Washington, general news item

LENGTH: 279 words

HEADLINE: ?Pacific Sues Calif. Over Contracts

BYLINE: DAVID KRAVETS


DATELINE: SAN FRANCISCO

BODY:

???California's largest utility has sued the state seeking reimbursement of
millions of dollars in energy contracts seized by the governor.

??San Francisco-based Pacific Gas & Electric Co. ''has received no 
compensation
for the damage to its property,'' the company said in a lawsuit filed Tuesday 
in
San Francisco Superior Court.

??PG&E filed for bankruptcy protection in April and is struggling to repay
$14.4 billion to thousands of creditors.

??Gov. Gray Davis seized the energy contracts on Jan. 31 to keep the 
California
Power Exchange from liquidating them. The now-defunct exchange, which had been
the state's middleman for buying and selling power, wanted the contracts to
recoup hundreds of millions of dollars that PG&E owed it.

??The governor's office acknowledged that California owes PG&E for the
contracts, an amount that Davis wants a judge to determine. At the time they
were seized, the state estimated their value at $160 million, while the power
exchange priced them at $347 million.

??''We seized the contracts to have reasonable priced power and expected that
price to be set in a neutral forum,'' said Steve Maviglio, the governor's
spokesman.

??Under the contracts, the state buys electricity at a set price rather than
paying higher prices for power bought at the last minute. Therefore, the
contracts' value changes with the volatile price of electricity.

??''We believe the state has benefited from the value of our contracts, and as
a result we should be compensated,'' PG&E spokesman Ron Low said.

??Low declined to place a value on the contracts.



?????(PROFILE


?????(CO:Pacific Gas and Electric; TS:PCG; IG:ELC;)


?????)


LOAD-DATE: July 18, 2001

??????????????????????????????5 of 57 DOCUMENTS

??????????????Copyright 2001 Knight Ridder/Tribune News Service
???????????????????????Knight Ridder/Tribune News Service

??????????????????????????????Contra Costa Times

???????????????????????????July 18, 2001, Wednesday

SECTION: STATE AND REGIONAL NEWS

KR-ACC-NO: ?K2631

LENGTH: 540 words

HEADLINE: Consumers cashing in instead of cooling off

BYLINE: By Katie Oyan

BODY:

??WALNUT CREEK, Calif. _ Whether it's the call of duty or the cash incentive,
the first wave of power bills reflecting a state rebate program show a large
number of Californians are lining up to ease the grid.

??Savings from Pacific Gas & Electric's 20/20 rebate program total $7.6 
million
so far, a spokesman said.

??The program, an initiative by Gov. Gray Davis to promote conservation, 
shaves
20 percent off customers' bills for using 20 percent less energy this summer
than last summer.

??PG&E has processed one-third of its July power bills, and the results show
that 29 percent of customers sliced enough electricity use last month to earn
the reward.

??Out of about 1.3 million bills processed, 394,000 customers qualified for 
the
credits.

??Thousands more still stand to gain as the company sifts through remaining
bills. PG&E serves 4.7 million customers in Northern California, from Baker to
the Oregon border.

??"Twenty-nine percent are meeting the qualifications, which is good," said
PG&E spokesman Jon Tremayne. "That's a significant chunk."

??The results also are significant compared to previous expectations. Davis
administration officials estimated that 10 percent to 20 percent of customers
would earn the rebate.

??Of those who qualified, 355,000 were residential customers and 39,000 fell
under commercial, industrial or agriculture categories.

??The savings were divided roughly in half. Residents saved $3.7 million;
businesses, factories, farms and ranches saved $3.9 million.

??The average residential customer who qualified for the discount sheared $
10.50 off energy costs. Commercial, industrial and agricultural customers _
whose bills can reach $200,000 a month _ saved an average of $100.

??"In general, these are all very positive results," Tremayne said. "It shows
that Californians as a whole, individually and collectively, do our part."

??Davis ordered investor-owned utilities _ PG&E, Southern California Edison 
and
San Diego Gas & Electric Co. _ to take part in rebate programs in March.

??The campaign was designed to stave off rolling blackouts and spare the state
from having to import loads of expensive electricity on behalf of its
financially distressed utilities.

??The programs benefit California's biggest energy guzzlers the most. Those 
who
used very little electricity to begin with have little room to cut back.

??Merle Luck, a senior citizen who lives in a one-bedroom apartment in 
Concord,
said the 20/20 reward is likely out of her grasp.

??"My bill isn't that high, so I don't come up to the baseline," she said.

??If Luck uses any less electricity than she already does, she'll roast.

??"I'm more careful and I think twice, but my big thing is the air
conditioner," she said. "I'm not keeping it quite as cool as I would like, 
but I
have lots of windows and lots of sun, and it can get very warm."

??Even with her conservation efforts, Luck's $28 power bill wasn't as steep as
she expected.

??"It's a little more than last year at this time, but I think we've had more
heat," she said.

??KRT CALIFORNIA is a premium service of Knight Ridder/Tribune

??(c) 2001, Contra Costa Times (Walnut Creek, Calif.).

??Visit the Contra Costa Times on the Web at http://www.cctimes.com/
 
JOURNAL-CODE: CC

LOAD-DATE: July 18, 2001

??????????????????????????????8 of 57 DOCUMENTS

??????????????????????Copyright 2001 / Los Angeles Times

??????????????????????????????Los Angeles Times

????????????????????July 18, 2001 Wednesday ?Home Edition

SECTION: Business; Part 3; Page 7; Financial Desk

LENGTH: 186 words

HEADLINE: PG&E Sues State Over Contracts

BYLINE: From Bloomberg News

DATELINE: SAN FRANCISCO

BODY:

??PG&E Corp.'s Pacific Gas & Electric Co. utility sued California on Tuesday,
saying it wants to be paid for the wholesale electricity contracts the state
seized in January.

??Gov. Gray Davis took away Pacific Gas' 12-month forward contracts to ensure 
a
sufficient and continuous supply of electricity for the state. ?At the time,
California estimated the contracts were worth $150 million.

??Pacific Gas claims the contracts had "significant value" because they 
allowed
the utility to receive power for less than current market rates.

??"Although PG&E has demanded just compensation from the [state], PG&E has
received no compensation for the damage to its property," the utility said in
court papers filed Monday in San Francisco Superior Court.

??The company, which filed for Chapter 11 protection in April, is seeking
damages and attorney fees. The state claimed in January that the contracts 
would
have delivered enough electricity to power 100,000 to 500,000 homes for 6 
cents
to 13 cents per kilowatt-hour.

??Officials in the governor's office did not immediately return calls seeking
comment.

LOAD-DATE: July 18, 2001

??????????????????????????????9 of 57 DOCUMENTS

??????????????????????Copyright 2001 / Los Angeles Times

??????????????????????????????Los Angeles Times

????????????????????July 18, 2001 Wednesday ?Home Edition

SECTION: Business; Part 3; Page 2; Financial Desk

LENGTH: 349 words

HEADLINE: California;
;
Trading, Wholesale Power Boost Duke's Earnings 27%

BYLINE: THOMAS S. MULLIGAN, TIMES STAFF WRITER

BODY:

??Pushed by the explosive growth of its trading and wholesale-power 
businesses,
Duke Energy Corp. on Tuesday reported a 27% increase in second-quarter profit,
narrowly topping Wall Street estimates.

??Duke's net income was $419 million, or 53 cents per share, in the quarter
ended June 30, up from $329 million, or 44 cents, in the year-ago quarter. The
consensus estimate of industry analysts was 52 cents per share.

??Revenue for the quarter leaped 43% to $15.6 billion.

??Shares rose 38 cents to close at $42.03 on the New York Stock Exchange.

??Charlotte, N.C.-based Duke, like other out-of-state independent power
producers, is under fire from Gov. Gray Davis for allegedly overcharging for
electricity from its California generating plants.

??Duke does not break out its California results, but its profits from soaring
spot-market prices in California during the quarter probably amounted to no 
more
than a penny or two per share, according to analyst Jeff Gildersleeves of 
Argus
Research in New York.

??California accounts for about 10% of Duke's U.S. wholesale-power business,
and about 90% of its California power is sold through long-term contracts 
rather
than on the spot market, the company has said.

??Those long-term contracts are a source of worry for investors, Gildersleeves
said. Neither Duke nor the state has disclosed whether the contract prices can
be adjusted downward if spot-market prices fall, he said. If the prices are 
not
firm, it could represent a risk to future profits, he added, especially if 
spot
prices continue to fall.

??Duke's North American Wholesale Energy business unit posted second-quarter
operating earnings of $251 million, up 128% from $110 million a year earlier.

??Analyst Timothy M. Winter of A.G. Edwards in St. Louis said the overall
quarter was "very good," considering that Duke's earnings from its regulated-
utility business in North and South Carolina actually were flat because of 
mild
weather, a slowing economy and increased costs associated with some nuclear
generating facilities being out of operation.

GRAPHIC: PHOTO: Duke, which owns a plant in Morro Bay, beat analyst estimates.
PHOTOGRAPHER: CAROLYN COLE / Los Angeles Times

LOAD-DATE: July 18, 2001

??????????????????????????????10 of 57 DOCUMENTS

??????????????Copyright 2001 Knight Ridder/Tribune News Service
???????????????????????Knight Ridder/Tribune News Service

??????????????????????????The Orange County Register

???????????????????????????July 18, 2001, Wednesday

SECTION: DOMESTIC NEWS

KR-ACC-NO: ?K1616

LENGTH: 1230 words

HEADLINE: Gov. Davis trying to turn energy crisis to political advantage

BYLINE: By John Howard

BODY:

??SACRAMENTO, Calif. _ An enduring image of the spring-summer of 2001: Calif.
Gov. Gray Davis perched in front of a power plant, speaking over the turbines'
din about California's energy crisis.

??The Democratic governor doesn't address the knot of sweaty local reporters
busily taking notes. He gazes past them to the television cameras, which 
capture
his image and send it across the nation. He may be speaking in Yuba City or
Sacramento or Bakersfield, but he's talking to Washington, D.C., New York and
Chicago.

??For Davis is trying to turn California's energy crisis to his political
advantage. Despite some setbacks - such as a federal regulatory judge's 
finding
last week that California is eligible for much less in energy refunds than 
Davis
wants _ he has a growing national presence, where just weeks ago he had almost
none.

??Davis remains the Democrats' point man on energy and the environment. Those
are two issues Democrats hope to use to win back the White House.

??"He's the leading governor among Democrats, and certainly the dominant
governor in a Democratic field for president," said Republican consultant Tony
Quinn. "But he has to get credit for getting the energy crisis solved. There 
has
to be sufficient supply next year, no blackouts next summer and the prices 
have
to stabilize."

??Davis has started to dance on the national stage, where presidential 
hopefuls
audition. And if he wins re-election next year _ not a certainty _ that stage
will be his new home.

??Thus, Davis, the career politician, has come to the defining moment of his
political career.

??"If he turns this around and gets re-elected handily, he's a contender," 
said
Larry Sabato, a political scientist at the University of Virginia.

??Sabato cautioned: "But he's in trouble in his own state. He didn't 
anticipate
the crisis, but he's been in office for two years, so it's difficult for him 
to
say, 'None of this happened on my watch.' That's a tough argument to make."

??Davis, of course, has been busy making precisely that argument every chance
he gets. The rest of his message: California, given short shrift by federal
regulators, has been bilked of billions of dollars by profit-hungry energy
companies.

??That message has been honed by Mark Fabiani and Chris Lehane, two political
consultants who are largely responsible for Davis' emerging national presence.
Davis hired them under a state-paid $30,000 contract that prompted outrage 
from
Republicans and at least one lawsuit. Fabiani recently left the state payroll.

??Both White House veterans, Fabiani and Lehane are known as the "Masters of
Disaster" for their handling of Clinton-Gore scandals, including Whitewater 
and
Asian fund-raising.

??In just seven weeks, the two strategists started turning Davis' political
fortunes around.

??"In March and April, I used to see these emails from Republicans doing high
fives and saying he (Davis) was toast. I don't see that now," said Mark
Bogetich, a Republican researcher.

??Davis also is using campaign funds to finance $150,000 a week worth of radio
ads to get his message to voters. The campaign follows Republican-backed
television ads targeting the governor.

??True, the Masters of Disaster have been lucky in polishing Davis' image _
there have been miscues by Bush, good weather and a dearth of blackouts. But
Fabiani and Lehane made their own luck, too.

??They went on the offensive, in the manner of an election campaign:

??They set up daily, campaign-style events, complete with "visuals" for
television and daily news nuggets for print media.

??They created the governor's "Daily Energy Agenda" and "News From Gray 
Davis,"
spin fixtures they faxed and emailed around the state.

??They began holding regular press conference calls with Davis administration
officials, daily and through the weekend, getting the administration's spin to
the public.

??They ratcheted up Davis' rhetoric demonizing power generators as
price-gougers and pirates, focused on Bush and his regulators as the power
behind California's crisis, and depicted the state as the helpless victim of
powerful forces.

??"They turned his numbers around, temporarily," said Sacramento-based
Republican consultant Mike Donovan. "But he's clearly not out of the woods 
yet."

??Bush's recent visit to California to attend an "energy summit" gave the
governor more ammunition. Davis, coached by Fabiani and Lehane, scored when
Bush, as expected, turned down the governor's request to meet with the public 
to
discuss the electricity crisis. The confrontation made front pages across the
country. In Lehane's view, it showed a responsible governor bashed by an
uncaring president.

??"In that sense, it was a major defining moment for both men," Lehane said.

??Nationally, Democrats have seized on environment and energy as two related
issues that will help give them back control of the House in 2002. They see
Davis as the key, and it is no secret in Washington that the White House views
Davis as a political threat.

??National media interest in Davis is growing and California television
reporters who cover the governor say their networks seek increasing coverage 
of
the governor.

??Since the spring, he has started to show up with greater regularity on
national television news shows, has become the national Democrats' point man 
to
attack the Bush administration's electricity policies, has been on CNN's 
"Larry
King Live" and "Inside Politics," and has done numerous talk shows. He's 
visited
the network morning programs. He's even been a mystery guest on "The Tonight
Show With Jay Leno" _ an appearance engineered in part by Lehane. He's 
testified
before a U.S. Senate newly dominated by friendly Democrats and made front 
pages
across the country.

??Looking to score points with national Democrats, Davis details his
differences with Bush on critical environmental issues. Those include Bush's
rejection of California's request for an exemption from a federal 
fuel-additive
requirement, the Bush administration's call for increased oil drilling in 
Alaska
and the president's dismantling of wilderness protections ordered by former
President Clinton.

??"He's more highly visible on the national level now, but if he stumbles, 
that
will be more visible, too," said political analyst Sherry Bebitch Jeffe of
Claremont Graduate University.

??Democratic pollster Paul Maslin agrees.

??"All this is moot until (California) voters render a judgment next November
(2002). Whatever is going on nationally is far secondary to him doing his job
and whatever the verdict of the voters is," Maslin said.

??Meanwhile, Bush might be helping Davis build a national profile. A recent 
New
York Times-CBS News survey showed Bush's personal appeal has dropped to its
lowest point since April 2000. Most people are disenchanted with a number of
Bush's policies, including energy and the environment, which Davis is 
targeting.

??"Ironically, he and Bush are basically joined at the hip on this energy
issue," Jeffe said. "He (Davis) is being blamed for it in California, and Bush
is being blamed for it nationally. So one could make the case that the 
political
fortunes of Gray Davis and George Bush are inextricably intertwined."

??ARCHIVE PHOTOS on NewsCom (from KRT Photo Service, 202-383-6099):

??Gray Davis

??(c) 2001, The Orange County Register (Santa Ana, Calif.).

??Visit the Register on the World Wide Web at http://www.ocregister.com/
 
JOURNAL-CODE: OC

LOAD-DATE: July 18, 2001

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?????????????????Copyright 2001 The Chronicle Publishing Co.

?????????????????????????The San Francisco Chronicle

???????????????????JULY 18, 2001, WEDNESDAY, FINAL EDITION

SECTION: NEWS; Pg. A14

LENGTH: 808 words

HEADLINE: Lawmakers devise rival bailout plans for Edison;

Push to come up with alternative to bankruptcy before recess

SOURCE: Chronicle Sacramento Bureau

BYLINE: Lynda Gledhill

DATELINE: Sacramento

BODY:
Lawmakers are struggling this week to agree on a plan to keep Southern
California Edison from declaring bankruptcy as they rush to complete business
before Friday's scheduled summer recess.

???After months of talking about a solution and dismissing one agreed to by
Edison and Gov. Gray Davis, lawmakers now have several competing proposals to
consider.

???A plan introduced last week by Assembly Speaker Robert Hertzberg, D-Sherman
Oaks (Los Angeles County), was debated for several hours yesterday, along 
with a
GOP-backed alternative by Assemblyman Roderick Wright, D-Los Angeles.

???The two plans, which are scheduled for votes today in the Assembly Energy
Costs and Availability Committee, take sharply different approaches:

???-- Hertzberg's plan would pay $2.4 billion for Edison's transmission lines
to help cover the utility's estimated $3.5 billion debt. The utility would be
allowed to pay off its remaining debt by issuing bonds.

???The utility would repay the bonds using ratepayer money. For the first two
years, all customers would pay for the debt, but after that the largest users
would pay off the rest.

???-- Wright calls his plan a "straight bailout." It would allow the utility 
to
issue bonds to cover all of its debt and impose a $2 a month rate increase for
all users until the debt is paid.

???The Senate also introduced its own plan. A bill by Sen. Byron Sher, D-Palo
Alto, would give the state a five-year option to buy the transmission lines 
and
would have the state back only $2.5 billion of the utility's debt.

???Since Davis announced a deal with Edison earlier this year, lawmakers,
business groups and consumer advocates have all expressed reservations with 
one
aspect or another of it. Opposition has usually focused on the state purchase 
of
Edison's transmission lines.

???The flurry of activity this week is an effort by lawmakers to take some 
kind
of vote before they adjourn. The Edison agreement has an Aug. 15 deadline for
approval by the Legislature.

???Brian Bennett, a spokesman for Edison, said creditors view that date as
extremely important.

???"We're as close to bankruptcy as our creditors want us to be," he said. "Is
it a drop dead date? I don't know, but it is clearly an important date."

???Consumer groups have denounced Wright's plan, and at least one calls
Hertzberg's proposal just another bailout and said it would cost Californians 
$
6.7 billion over the next 10 years.

???"We cannot be seduced by big businesses paying a bailout tax," said Doug
Heller, a consumer advocate with the Foundation for Taxpayer and Consumer
Rights. "At the end of the day, we know businesses will pass these costs on to
the consumer."

???Included in the 76-page Hertzberg bill are provisions that would allow 
large
companies to buy their power directly from a provider instead of going through
the utility after 2003.

???But a coalition of large business groups also said they are strongly 
opposed
to the plan because it does not allow for immediate direct access.

???"Ultimately, we think our companies buying power for themselves is the best
solution," said Jack Stewart, president of the California Manufacturers and
Technology Association. "If businesses think there's a light at the end of the
tunnel where they see lower rates coming, they might tough it out and stay."

???Wright argues that the beauty of his proposal is that it could easily apply
to the Pacific Gas and Electric Co. service area if the company wanted to use 
it
as a way out of bankruptcy court. He estimates that PG&E customers would pay
about $4 a month to help the company pay off its debt.

???"This is a straight bailout," Wright said. "This is not a hidden bill. 
There
are extras."

???Wright said he believes his constituents would rather pay an extra $2 than
be unemployed because their business left the state due to high energy costs.

???Business groups said the idea makes sense.

???"What good would it do to have your electricity bill reduced by $10 or $15
but not have a job?" said Bill Hauck, president of the California Business
Roundtable.

???Whatever plan is eventually authorized would be used to convince the PG&E
bankruptcy judge to follow a similar model for that company, giving the state
those transmission lines as well.

???The purchase of the transmission lines has been at the center of Davis'
plan. He argues that the purchase will give the state the ability to upgrade 
the
system, allowing a better flow of power between Northern and Southern 
California
and a decreased chance of blackouts.

???But opponents argue that the state is getting one-third of a complicated
system that will cost billions to upgrade and operate.

???"It's like buying a car with three wheels -- it is not going to get out of
the lot," consumer advocate Heller said.E-mail Lynda Gledhill at
lgledhill@sfchronicle.com.

LOAD-DATE: July 18, 2001

??????????????????????????????13 of 57 DOCUMENTS

????????????????????Copyright 2001 Chicago Tribune Company

???????????????????????????????Chicago Tribune

?????????????July 18, 2001 Wednesday, NORTH SPORTS FINAL EDITION

SECTION: Editorial; Pg. 20; ZONE: N

LENGTH: 675 words

HEADLINE: The (ho-hum) energy crisis

BODY:

??Republicans usually have faith that markets will correct themselves. When it
comes to energy, though, the Bush administration seems to have lost the faith.

??At least, that's the more charitable way to interpret the White House's
approach toward an energy policy. The less charitable way is to assume the 
Bush
team jumped on temporary market aberrations to sell legislation in the midst 
of
an overblown, manufactured, energy crisis.

??Charitable or uncharitable, the fact is President Bush sent a small army of
lawmakers and Cabinet officials to fan across the country this week to sell 
his
energy policy, but they're selling amid a spate of bad news. Bad news for the
administration, but not for consumers.

??Remember those predictions by Energy Secretary Spencer Abraham and others
that gasoline prices would top $3 a gallon this summer? Higher prices lured 
more
gas to the market and eased supply problems. Prices are resting comfortably at
less than half that predicted price.

??The nation struggled when natural gas prices doubled last winter. But high
prices reduced demand and lured more production, and by the end of winter 
prices
were easing.

??And, finally, the predictions of a long, dark summer in California have not
come true. That's not necessarily because markets corrected themselves.
California and federal regulators intervened with price caps and a massive 
state
government effort to take control of the electricity market. But the true 
price
of such intervention may be severe--the state has committed to long-term
electricity contracts and massive government borrowing that will be a drain on
the state's economy for years.

??Energy deregulation in the 1970s and 1980s drove prices down, but lower
prices discouraged investment in energy production. That failure to expand
production has caught up to us. But now we're seeing the market respond again:
Higher energy prices are spurring more production, which has already begun to
ease prices.

??In the meantime, the Bush administration seems to have gotten the message
that the public takes environmental protection quite seriously, even while
there's talk of an energy crisis. The administration was forced to greatly 
scale
down its plans for oil and gas drilling in the Gulf of Mexico. Its ill-advised
plans to drill in the Arctic National Wildlife Refuge are all but dead. The 
U.S.
House--driven by moderate Republicans who hold the balance of power--has voted
to ban new drilling in the Great Lakes and is moving to promote conservation 
and
energy efficiency.

??The Bush team invited a public relations disaster from the beginning, when
Vice President Dick Cheney's energy task force held closed-door meetings in
which energy producers were on the inside and environmentalists on the 
outside.
The president's own warnings of "a dark future" and geopolitical blackmail
spurred by severe energy shortages sound a little shrill now.

??But the administration has an opportunity to lick its wounds and make
something out of the beating it has taken. There are a lot of sensible ideas 
in
the Bush energy policy, though public awareness of many of them got crowded 
out
by visions of oil wells popping up next to the Alaska caribou and Florida
beachcombers.

??U.S. economic expansion will demand more energy sources. The
administration's goal of streamlined government review to get power plants up
and running makes sense. So does the effort to improve the reliability of
interstate power lines so electricity can get to where it's needed. The
hodge-podge of federal, state and local rules on gasoline formulas restrict
supply and hike prices; proposals to move toward a federal standard make 
sense.

??The Bush administration--starting with Dick Cheney's 'bah, humbug' attitude
toward conservation--has mishandled its political strategy on energy. But it 
can
recover without a wholesale recasting of its priorities: Respect the
environment, promote efficiency and conservation, and remove the unnecessary
government roadblocks that stall new energy sources from getting to the 
market.

LOAD-DATE: July 18, 2001