Yikes! Check this out:
---------------------- Forwarded by Joseph Alamo/NA/Enron on 04/03/2001 11:39 
AM ---------------------------


	Joseph Alamo
	04/03/2001 11:39 AM
	
To: Miyung Buster/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
cc:  

Subject: "Power brokering: Loretta Lynch has landed in the energy spotlight 
as the firm hand at PUC's helm"
April 3, 2001 - The Orange County Register






Power brokering 
Loretta Lynch has landed in the energy spotlight as the firm hand at PUC's 
helm. 
April 3, 2001 
By JOHN HOWARD
The Orange County Register 
SACRAMENTO At the eye of California's darkening electricity storm is Loretta 
Lynch, the self-described small-town girl who became the top utility 
regulator in the nation's largest state. 
Her decision last week to push through a double-digit rate increase affecting 
25 million people shocked many in the state and drew fire from powerful 
interests, including consumer groups, the public, the utilities, Wall Street 
- and Gov. Gray Davis. 
The Yale-trained lawyer says she acted independently of the governor, who 
appointed her president of the Public Utilities Commission. 
"I go my way and decide the issues based on the best evidence, period," Lynch 
said last week in a lunchtime interview in a coffee shop across the street 
from the Capitol. "All the scenarios, every set of assumptions pointed to the 
fact that we needed to increase rates. There was absolute evidence and strong 
analyses, and we went forward." 
Absent a rate increase, she said, there might not be enough revenue to back 
an upcoming bond issue the state desperately needs to steady the energy 
market. 
As much as Davis himself, the 39-year-old Lynch is fast becoming a target for 
Republicans who see in California's energy crisis an opportunity to make 
gains in the 2002 elections. 
In a report to the Republicans in the Assembly, veteran political consultant 
Sal Russo described Lynch as a formidable foe, a "master of damage control, a 
hard-nosed political warrior experienced in scapegoat politics." 
'Most capable' in 20 years 
She acknowledges she's in a political pressure cooker. 
"I accept that, I deal with that. I don't go to the gym as often as I used to 
because the days are so long, but I still go and I deal with the tension. I 
love hiking, and that helps." 
Longtime consumer advocate Michael Shames agrees Lynch is on the hot seat. 
"The president of the PUC is always a voodoo doll that people stick with pins 
intended to hurt other people," said Shames, who has been involved in utility 
issues in San Diego for two decades. "I think she's being stuck with pins 
right now. The question is whether she can stand the pain. 
"She is probably the most capable commissioner to head the agency in 20 
years, but she's got a thankless task and she's finding it a tough job." 
'Small-town girl' 
Scrappy and voluble, Lynch proudly describes herself as a "small-town girl 
from Independence, Mo. I come from a big family, an Irish-Catholic family. I 
have five sisters, and the only way you went to college where I grew up was 
on a scholarship." 
She says her family is tight- knit, and she speaks frequently by phone with 
her sisters, including Cecelia Lynch, a political science professor at the 
University of California, Irvine. 
A debater in high school, Loretta Lynch left Independence - "we lived about a 
mile from Harry Truman" - and went to the University of Southern California. 
From there she went to Yale Law School. She returned to Los Angeles and 
worked as a lawyer at the Legal Aid Foundation, which provides legal help for 
the poor. 
She then served eight years as a staff attorney handling civil litigation in 
the San Francisco law firm of Keker & Van Nest. 
In between, she found time to clerk for a federal appellate justice and work 
on four major political campaigns, including Bill Clinton's 1992 presidential 
race, Dianne Feinstein's first U.S. Senate bid and John Van de Kamp's failed 
gubernatorial campaign. A Democrat from a family of Democrats, Lynch stayed 
with her roots. 
What did she learn in the political wars? 
"Don't take anything personally and think before you speak," she said. 
She served briefly as Gov. Gray Davis' research and policy director, and 
since May 2000 she has headed the PUC, an enormously powerful agency with 900 
employees, sweeping authority over telecommunications and electricity and a 
direct effect on the wallets of millions of Californians. 
She had little or no experience in energy regulation before her appointment 
to the $117,081-a-year job. 
"Where I come from, there aren't a lot of people making six-figure salaries," 
she notes. 
Obscure no longer 
Once scarcely known, the PUC is at the center of California's electricity 
crisis. And Lynch is at the center of the PUC. 
The PUC "was ... one of those little agencies with enormous power that nobody 
watches," she said. 
But it now faces the glare of daily media attention and the suspicion, and 
sometimes anger, of the public. Its decisions are watched across the nation, 
and a major action - such as its unanimous decision to approve an as-much- as 
36 percent boost in electricity bills can rock Wall Street. 
Lynch, who is single, says she tries to conserve electricity. And she says 
she has not suffered through blackouts, although several friends have. 
"I hear from them every time it happens. I hear from people who want me to 
know they've had a bad experience. Real people experiencing real burdens, and 
it's important to remember that." 
Davis influence 
Despite Davis' well-deserved reputation as a micromanager and his 
oft-repeated statements that his appointees are there to represent his 
thinking, Lynch avers that her actions are independent of the governor, and 
declined to say whether she consulted him in advance. 
Davis, for his part, says Lynch did not consult him before she pushed for the 
rate increase, despite strong suspicions among Democrats and Republicans 
alike, including many who have known Davis for years, that she deliberately 
took the political heat for the governor. 
Lynch believes three things led to California's electricity crisis - an 
earlier deregulation decision by a Republican-dominated PUC, a poorly drafted 
deregulation law and, most of all, outright "gouging and gaming" by 
electricity wholesalers. "It all comes back to those wholesalers," she said. 
As she waits to order a sandwich, a woman smiles, approaches and gives her 
hug. "Hang in there, Loretta. Hang in there," the woman says, suspiciously 
eyeing a nearby reporter with a notebook. 
"Not a problem," Lynch says.