We face two parallel tracks in the Senate in the coming weeks between now and 
the start of the congressional recess for one week on June 29th.

In the Senate Energy and Natural Resources Committee, we will be facing 
efforts by pro-price caps forces who will use the committee "bully pulpit" to 
pressure FERC into more action.  This effort is led by incoming chairman 
Bingaman with support from Majority Leader Daschle.  They are saying they 
will consider acting on the Feinstein-Smith price cap legislation unless FERC 
takes unspecified additional action by the end of this month.

The new track in the Senate will be in the Governmental Affairs Committee 
chaired by Sen. Lieberman (D-CT).  While this committee does not have the 
legislative jurisdiction over energy that the Energy Committee does in terms 
of moving legislation, the Governmental Affairs Committee has  broad 
oversight and investigatory jurisdiction over all federal agencies, including 
FERC.  New chairman Lieberman held his first press conference as chairman 
today and said addressing high energy prices would be a priority.

In that vein, the committee is expected to hold a hearing on June 13 
featuring some of the economists who wrote a letter in favor of price caps 
last month.  We are checking with the Republican staff to make sure that the 
anti-price cap economists (the majority of the discipline, of course) will 
also testify.  We also brief committee members and staff with our arguments 
against price caps and the latest publicly available market data.  On June 20 
the committee will hold a hearing on whether FERC has properly exercised its 
duties under the Federal Power Act to make sure that wholesale power rates 
are just and reasonable.  We are going to meet with the committee majority 
staff, but we presently expect this hearing to have political witnesses 
(i.e., elected officials, possibly including Gov. Davis).

We must keep in mind that Sen. Feinstein had earlier written to Chairman 
Lieberman asking for a hearing on the California energy situation, including 
relationships between FERC and those it regulates (citing the NY Times 
article involving Enron and Chairman Hebert).  There is at present no 
indicationi that either hearing will address this matter.  We are, as you 
might imagine, paying close attention to this situation.

Over in the House, Energy and Commerce Chairman Tauzin has said he will write 
to FERC asking them to extend the April 26 price mitigation order to the 
entire west and to extend it to 24/7.  He also asks FERC to see if it can 
implement "negawatts" demand reduction administratively.  We are in the 
process of obtaining a copy of the letter, which has not yet been made public.

Also in the House, we expect congressional committees to begin marking up 
portions of the President's energy legislation and related topics as the 
month unfolds.