San Diego Union-Tribune

April 14, 2001

FERC orders release of energy contracts
   Regulators' demand for secret deals riles Davis administration 


WASHINGTON -- Federal regulators have ordered power suppliers to turn over copies of their confidential short-term and long-term contracts with California, which the regulators intend to share with a congressional committee.

In a letter sent to the power companies Thursday, the Federal Energy Regulatory Commission said it would "treat these contracts as confidential" unless the supplier waives confidentiality.

It is unclear whether the House Government Reform Committee is under the same obligation, though FERC said the information would be given to the committee "under confidential seal."

Gov. Gray Davis has been keeping details of the contracts secret, arguing that revealing the information would weaken the state's bargaining position in negotiations with other suppliers. FERC's order angered the Davis administration, which fears the information will be leaked once it is in federal hands.

"It just seems to me that FERC is trying to give generators more leverage," said Davis spokesman Steve Maviglio. "The more information we release, the more Californians are going to have to pay."

FERC's letter to the 49 power suppliers came two days after Republican congressmen threatened to issue subpoenas for the contracts at a U.S. House Government Reform Committee hearing in Sacramento on the power crisis.

"We want that information," Rep. Dan Burton, R-Ind., the committee chairman, told California Public Utilities Commission President Loretta Lynch.

So do California news organizations -- including The San Diego Union-Tribune -- and Republican state lawmakers, who have filed separate suits to get it.

The California Department of Water Resources has been buying power on behalf of the state's cash-strapped utilities. FERC said it wanted to see the contracts "to determine how successful efforts
have been to fashion long-term contracts and to reduce reliance on spot markets," where electricity prices are typically higher.

FERC issued an order Dec. 15 designed to encourage long-term contracts and bring some stability to California's chaotic power market.

The letter to the power companies said FERC "intends to provide copies of the contracts to the Committee on Government Reform under confidential seal."

A FERC spokeswoman said she was unsure whether that meant the committee would be obligated to keep the information secret. She referred the question to the committee. A spokesman for the
committee could not be reached for comment.

FERC gave the power suppliers until the close of business Monday to file the contract copies.

Meanwhile, for the second time this week, Energy Secretary Spencer Abraham defended the Bush administration's response to the California crisis. Critics have blistered the administration for refusing to consider price controls on wholesale electricity.

In a letter to members of Congress and California legislators released by the Energy Department on Friday, Abraham outlined 11 steps the administration and FERC have taken, such as ordering federal agencies to expedite permits for new power plants and asking power providers to do everything they can to avoid disruptions this summer.

"Regrettably, our well-founded opposition to price caps has been claimed by some to suggest the administration either does not care about California and the West or is doing nothing to address the problem," Abraham wrote.

Abraham made similar comments when briefing reporters Monday on the Energy Department's proposed budget for fiscal year 2002.