Sunday, April 20, 2014
YOLO COUNTY NEWS
99 CENTS

Energy justice was long-delayed

TomEliasW

By
From page A10 | June 14, 2013 | 1 Comment

It’s taken almost 13 years, but justice finally may be coming to California consumers victimized by the federal government during California’s energy crunch of 2000 and 2001.

Yes, by the federal government.

For folks who weren’t in California or don’t remember, that was the time when power prices here soared as electricity-trading companies like Enron, Reliant Energy, the Williams Cos. and several others conspired illegally to take advantage of this state’s abortive deregulation plan.

“Buccaneers from out-of-state” caused the problem, then-Gov. Gray Davis complained at the time. Few took his charge seriously, least of all the Federal Energy Regulatory Commission, which could instantly have stopped the illegal practice of making fake, phantom shipments of power out of California and then selling the same power back to California utilities at vastly inflated prices.

One result was that Davis’ public approval ratings dropped severely, leaving him vulnerable to the recall election of 2003.

So this energy crunch had political consequences. At the same time, politics had major consequences for consumers. When Republican George W. Bush won the presidency in 2000 without help from California, the state no longer got much sympathy from presidential appointees of most sorts.

No matter how often Davis and other state officials protested the power profiteering, FERC did nothing, and eventually Californians were bilked of more than $10 billion in excessive electricity prices. Super-high prices continued for years after the crunch, as Californians paid for the long-term power supply contracts forced on the state’s Independent System Operator during the crisis.

It wasn’t just through FERC that the federal government persecuted and cheated every residential and commercial electricity customer in this state.

California also bought power at that time from two federal agencies operating dams on major Western rivers. Those were the Bonneville Power Administration based in Portland, Ore., and the Western Area Power Administration in Lakewood, Colo.

Davis at the time charged these federal agencies with profiteering similarly to Enron and other private companies whose executives later were convicted of illegal market manipulation.

The criminal trials of Enron chieftains and others proved Davis correct about those “out-of-state buccaneers,” and now he’s been proven right about the federal agencies, too.

This happened when, in what may have been the most under-reported story of the spring, the U.S. Court of Federal Claims in Washington, D.C., ruled that both the Bonneville and Western Area power administrations bilked Californians of more than $2 billion during and after the electricity crunch. In a separate ruling about the same time, a FERC administrative law judge found that private companies cheated Californians out of at least $1 billion more than they’ve already been forced to refund.

Even after the end of rolling blackouts deliberately created by market manipulators to sow public panic and desperation that left Californians susceptible to gouging, both the federal and private outfits continued to take advantage, the judges ruled. The exact amounts of their liability will be determined in separate court proceedings this month.

After that, the state Public Utilities Commission will decide how to return the money to consumers. Only part of past settlements with private companies has been returned directly to customers who were cheated, with portions going to fund new generating capacity.

Because every region of the state now possesses power plants with the potential to produce at least 15 percent more power than projected maximum demands, all of the new refunds ought to go straight to consumers, applied to their monthly bills.

But the PUC, which was a big supporter of deregulation before the energy crunch despite warnings from consumer groups that large-scale market manipulation surely would follow, has never before given much back to consumers.

The bottom line on all this is an old lesson: Eternal vigilance is the price of freedom.

Because of the complexity of the energy regulatory process, power companies and the federal and state agencies that regulate them get little public attention. Operating out of the news-coverage spotlight, they sometimes try to take advantage. The only way to avoid future crises and cheating, then, is to shine that spotlight on them continually.

— Reach syndicated columnist Tom Elias at tdelias@aol.com

LEAVE A COMMENT

Discussion | 1 comment

The Davis Enterprise does not necessarily condone the comments here, nor does it review every post. Read our full policy

  • ml1999June 14, 2013 - 12:19 pm

    Good article. But I think Mr. Elias left off a few points. Gov. Gray Davis was recalled for many reasons, his management of the energy crisis just one of them. I also recall very unpopular decisions like driver's licenses for illegal immigrants; massive pay hikes for (union) prison guards; promises of new taxes as a way of life; and a huge state deficit released just days after his re-election. Mr. Elias has also washed over the fact that we've said we've said "no" to new sources of energy for decades, and also increased taxes on existing sources of energy. Lastly, I'm not sure that Mr. Elias has read the news lately. After extremists have shut down one of our largest clean sources of energy - nuclear plant San Onofre in San Diego - where will more non-CO2 emitting energy come from? That is at least 4% of our state's electrical needs right there, which probably makes it 10% or more of Southern California's electrical needs. Pray for a cool summer SoCal. We'll see if the anti-nuclear crowd will get any blackouts this summer, and a rise in energy prices is likely.

    Reply | Report abusive comment
  • Recent Posts

  • Enter your email address to subscribe to this newspaper and receive notifications of new articles by email.

  • .

    News

    Hub of activity: DHS newspaper keeps evolving

    By Zoe Juanitas | From Page: A1 | Gallery

     
    A springtime ritual

    By Wayne Tilcock | From Page: A1 | Gallery

     
    Holy fire ceremony draws thousands in Jerusalem

    By The Associated Press | From Page: A2 | Gallery

     
    Ortiz lawn signs available

    By Enterprise staff | From Page: A3

     
    Sign up soon for spring cooking classes

    By Enterprise staff | From Page: A3

    Robb Davis team to rally on Saturday

    By Enterprise staff | From Page: A3

     
    Tour renovated YCCC facility Thursday

    By Enterprise staff | From Page: A3

    Tour Davis Waldorf School on Wednesday

    By Enterprise staff | From Page: A3

     
    The fifth annual Tour de Cluck is soon to be hatched

    By Special to The Enterprise | From Page: A3 | Gallery

    Yolo Hospice offers free grief workshops

    By Enterprise staff | From Page: A4

     
    Sign up for Camp Kesem caterpillar crawl

    By Enterprise staff | From Page: A4

    Quilters gear up for annual show

    By Sebastian Onate | From Page: A4

     
    Steadfast in their support

    By Lauren Keene | From Page: A4, 11 Comments | Gallery

    League hosts a series of candidate forums

    By Enterprise staff | From Page: A5

     
    KDVS launches fund drive on Monday

    By Jeff Hudson | From Page: A5

    Calling all Scrabble fans

    By Enterprise staff | From Page: A5, 1 Comment | Gallery

     
    Hub webpage is seeing traffic increasing

    By Zoe Juanitas | From Page: A8

    Learn Chinese crafts at I-House

    By Sebastian Onate | From Page: A16

     
    Preschool open house set at Davis Waldorf

    By Enterprise staff | From Page: A16

    Birch Lane celebrates its 50th anniversary

    By Enterprise staff | From Page: A16

     
    Hotel/conference center info meeting set

    By Enterprise staff | From Page: A16

    Lescroart welcomes all to book-launch party

    By Special to The Enterprise | From Page: A16 | Gallery

     
    DEVO set to serve up 14th annual Winkler Dinner

    By Enterprise staff | From Page: A16, 1 Comment | Gallery

    .

    Forum

    Take ownership of your health

    By Special to The Enterprise | From Page: B5

     
    Not thrilled with lack of symmetry

    By Special to The Enterprise | From Page: A7

    Reliving the agony and ecstasy of spring

    By Marion Franck | From Page: A7

     
    Keep your baby safe

    By Special to The Enterprise | From Page: A7

     
    Rick McKee cartoon

    By Debbie Davis | From Page: A12

     
    Core values on campus

    By Our View | From Page: A12, 3 Comments

    Road diet? No, city diet!

    By Letters to the Editor | From Page: A12, 5 Comments

     
    We’re reveling in our equality

    By Letters to the Editor | From Page: A12, 1 Comment

    Vote no; it’s fiscally responsible

    By Letters to the Editor | From Page: A12, 3 Comments

     
    Bill is an affront to UC Davis ag biotech and local farmers

    By Special to The Enterprise | From Page: A13, 3 Comments

    Don’t want to sit in Fix 50 traffic? Consider alternatives

    By Special to The Enterprise | From Page: A13, 1 Comment

     
    .

    Sports

    Stars shine in Woody Wilson Classic

    By Evan Ream | From Page: B1, 1 Comment | Gallery

     
    Devils burn up the track

    By Enterprise staff | From Page: B1

     
    UCD softball shut out by Santa Barbara

    By Thomas Oide | From Page: B1 | Gallery

    Aggie men shoot 9-under, lead own tourney

    By Bruce Gallaudet | From Page: B1 | Gallery

     
    UCD roundup: Aggie baseball swept away by Highlanders

    By Enterprise staff | From Page: B2

    A’s score 3 in ninth, rally past Astros 4-3

    By The Associated Press | From Page: B6

     
    .

    Features

    .

    Arts

    .

    Business

    Pediatricians, nurse practitioner hired at Woodland Healthcare

    By Enterprise staff | From Page: A9 | Gallery

     
    Asian stocks mostly higher after mixed U.S. earnings

    By The Associated Press | From Page: A9

    Yolo Federal Credit Union gets WISH funds

    By Enterprise staff | From Page: A9

     
    PG&E pays taxes, fees to county, cities

    By Enterprise staff | From Page: A9, 1 Comment

    Will Davis get an Old Soul?

    By Wendy Weitzel | From Page: A9

     
    University Honda wins another President’s Award

    By Enterprise staff | From Page: A14 | Gallery

    Dutch Bros. raises $19,000 for girl with leukemia

    By Enterprise staff | From Page: A14 | Gallery

     
    Davis Roots will showcase its graduating startups

    By Enterprise staff | From Page: A14

    .

    Obituaries

    .

    Comics

    Comics: Sunday, April 20, 2014

    By Creator | From Page: B8