[Congressional Record Volume 146, Number 142 (Wednesday, November 1, 2000)]
[Senate]
[Pages S11470-S11471]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                        ELECTRICITY PRICE SPIKES

  Mr. CRAIG. Mr. President, I very recently came to the floor and 
expressed my grave concern about the reliability of affordable 
electricity. I am not alone in my concerns about this issue. Indeed, 
some of the loudest voices expressing similar concerns about energy 
prices are coming from not just Idaho but California, and specifically 
from my distinguished colleagues from California here in the Senate.
  By my comments today, I do not diminish or in any way cast doubt 
about the substantial hardships experienced by the ratepayers in 
California, particularly southern California. Indeed, I have great 
empathy for them, primarily because Pacific Northwest ratepayers are 
bracing for power shortages in the near future that will cause energy 
prices to soar and hurt large and small businesses alike and put some 
residential customers in danger, especially during the cold and hot 
periods of the year in our region of the Pacific Northwest. I share 
equal concerns with the citizens of California.
  We must confront the obvious facts facing all energy consumers today.
  There is an energy supply crisis in the United States. It is clear 
that the administration didn't see it coming, or at least ignored it. 
We in the Congress heard no alarms from the Department of Energy and 
were given not enough warning during the last 8 years that an energy 
supply crisis was about to threaten the electrical industry of our 
country.
  One of the very few pieces of energy legislation that was sent to 
Congress for review and passage was the administration's Comprehensive 
Electrical Competition Act in April 1999. This legislation was 
purported to result in $20 billion in savings a year to America's 
energy consumers. However, this legislation would not have precluded 
the crisis in California, the kind that Californians experienced this 
summer. Indeed, the legislation was full of mandates and rules that 
didn't offer any economic incentives or investments in new supplies.
  Moreover, the legislation included a renewable portfolio mandate that 
did not include cheap hydropower as a renewable. I know the Presiding 
Officer and I talked about it at that time--that all of a sudden we had 
an administration that was not going to include hydropower as a 
renewable. This renewable portfolio requirement would have made 
electricity more expensive and more scarce to the consumer. Part of the 
problem in California appears to be that it is unwilling to accept the 
tradeoff of high prices required by environmental regulations. Either 
the tough environmental standards that currently exist in California 
are an acceptable cost of energy consumption or California must make 
necessary environmental adjustments for more abundant supplies at a 
cheaper price.
  In addition, the administration must reexamine the use of the price 
caps that apparently have caused the supply problems in California.
  Mr. President, these are some of the reasons why the legislation 
failed to get the desired support in Congress from a majority of the 
Members which included many Democrats as well as Republicans. We 
recognized you simply can't just go out and say here is the energy, 
what it is going to cost, cap it at prices, and put all these 
environmental restrictions on it. It is going to ultimately get to the 
consumer and, boy, did it get to them in California this summer. Many 
of us were justifiably concerned about the impact such legislation 
would have on the current electrical supply network that supports the 
most reliable electric service found anywhere in the world.
  The administration did not adequately explain how the legislation 
would prevent energy supply problems from occurring if its legislation 
was passed--perhaps because it simply didn't have an adequate 
explanation or, if it knew the facts, it certainly wasn't willing to 
have them known publicly.

[[Page S11471]]

  Rather than wait for Federal direction on this issue, many States 
embarked on their own experiment with electrical restructuring. Some of 
those State programs appeared to be experiencing some success by giving 
to their electricity consumers choice of energy suppliers without 
jeopardizing reliable service. However, other States are experiencing 
great difficulties ensuring reliable service at affordable prices. And 
California happens to be one of those States.
  I am not interested in pointing blame for failures. I am interested 
in getting at the facts and understanding them as they relate to how 
they contributed to the failures so that objective assessments of 
future legislative proposals can be made to avoid what happened in 
California again in the coming years. Moreover, I want to ensure that 
the distinguished Members from California have all of the facts 
necessary to fully understand and appreciate the role the Bonneville 
Power Administration plays in the California markets. There were a lot 
of accusations made this summer about how the Bonneville Power 
Administration was handling its electrical supply. I think the facts 
are soon to be known and an entirely different story will emerge.

  I fully expect the facts to prove that the Bonneville Power 
Administration has not contributed to the energy cost crisis in 
California and that BPA can and will continue to play a positive role 
in bringing affordable surplus electricity from the Pacific Northwest 
to the California markets when that surplus is available.
  For these reasons, it is imperative to get relevant information about 
the California energy price crisis to Congress and the American people 
as soon as possible. It has come to my attention that the Federal 
Energy Regulatory Commission's investigative report on California's 
wholesale electricity markets is complete and ready for distribution. I 
was told just this morning that they have finally decided to release 
it.
  Indeed, in a news report yesterday, I read that a Democrat 
Commissioner from FERC stated that the FERC could not find evidence 
that California power rates were unjust and unreasonable. The 
Commissioner also told the reporters that there was no evidence of 
abuse by energy companies operating within the State.
  This is important information that must be shared and now will be 
shared with Congress and all electrical consumers. The news reports 
also say the Federal Energy Regulatory Commission report would address 
sweeping structural changes in California's independent supply 
operator, or ISO, which controls the high voltage transmission grid, 
and the State's power transmission grid, and the State's power 
exchange, where power is bought and sold.
  It has come to my attention that the FERC report has been complete 
since October 16. There was some effort to keep it quiet, but it 
appears now to be breaking on the scene. This important information has 
been available and is now, as I say, beginning to come out. I do not 
understand why Congress should resist this kind of information. It 
ought to be made immediately available to Members of the Senate Energy 
and Natural Resources Committee and the committee of jurisdiction for 
FERC issues and shared with members of the House Commerce Committee, 
where all of these issues will have to be considered.
  Indeed, one of the FERC Commissioners recognized its importance and 
talked about the issuance of this report. Commissioner Hebert captured 
these thoughts with some pretty eloquent words on October 19 when he 
said:

       Rather than wait for November 1 to release the findings of 
     our staff's investigation--

  Which they finally did. He felt it was important that they do it at 
this time. He said--

       I urge the Chairman to release the completed report now.

  It seems that Commissioner is finally getting his way.

       Open government requires it; fairness does as well.

  And, most importantly, on this kind of information.

       The people of California should have as much time 
     as possible to digest findings and consider the options 
     presented.
       Justice Brandeis often remarked, ``Sunshine is the best 
     disinfectant.'' Let the sun shine on our staff's report.

  The Commissioner is speaking of the FERC staff.

       It can only help heal the raw emotions rampant in the State 
     of California.

  It is time Californians look at themselves and decide what went wrong 
in California because it wasn't as a result of the Bonneville Power 
Administration hoarding its power or choosing not to send power to 
California. It was California now finding out that some of the 
environmental restrictions they wanted in their marketplace are going 
to be very expensive restrictions indeed for which the average consumer 
of California will have to pay.
  With that, I yield the floor.

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