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House GOP Cuts Power to Emergency Energy Bill by Tom Detzel, The Oregonian staff The Oregonian, June 7, 2001

Republicans abandon the "Electricity Emergency Relief Act"
because of a lack of bipartisan support

WASHINGTON -- Unable to bridge differences with Democrats over price controls on wholesale electricity, House Republicans on Wednesday abandoned a bill they once hoped would ease this summer's power crisis in the West.

As the "Electricity Emergency Relief Act" hit the legislative trash heap, Rep. Billy Tauzin, R-La., said the GOP would instead start working on long-term energy legislation following the path of President Bush's new national strategy.

"We simply didn't want to do it when we had so little bipartisan support," said Tauzin, who, as House Energy and Commerce Committee chairman, had tried to broker a deal on the bill over the past two weeks.

Democrats on the panel called the decision a mistake and vowed to continue pressing for temporary price controls, which are opposed by most Republicans and have been repeatedly denounced by the president.

"We want the opportunity to put our case forward and get a vote, because Californians, Oregonians and Washingtonians are going to face blackouts and increased costs as this summer continues," said Rep. Henry Waxman, D-Calif.

The decision by House Republicans to turn away from short-term help for California and the West shifts the debate over price controls to the Senate, where a bill being pushed by Sen. Gordon Smith, R-Ore., could be taken up.

Smith's measure, which is co-sponsored by Sens. Dianne Feinstein, D-Calif., and Jeff Bingaman, D-N.M., would require federal energy regulators to enact cost-based wholesale power rates in 11 Western states.

Backers of price controls say they are needed temporarily to give the region a breather until new power supplies come on line and prices can fall. In the past year, California's failed deregulation plan and the Northwest's drought have conspired to push up wholesale prices more than tenfold.

Bingaman, the incoming chairman of the Senate Energy Committee, has said that, before passing legislation, he would rather see the Federal Energy Regulatory Commission fulfill its responsibility under the law to set "just and reasonable" rates across the West.

Smith continues to think that price controls "need to be done as soon as possible," spokesman Chris Matthews said.

"We've just had to assume that with the Democrats in power and their stated support for price caps, they would act on the most viable plan out there," Matthews said of the Smith-Feinstein bill.

Democrats had lost a vote last month to get price controls into the House bill sidelined Wednesday. Instead, the measure contained a handful of provisions designed to either reduce demand for electricity or increase supplies in the short term.

Some of those ideas already had been adopted either by the Bush administration or California Gov. Gray Davis, Tauzin said. He cited efforts to fix congested California transmission lines, order government agencies to conserve and prepare for possible blackouts, and boost aid for low-income ratepayers.

But others may be incorporated in long-term legislation, he said. Among them is a controversial section directing the Federal Energy Regulatory Commission to set rules to let retail and wholesale utility customers resell unused power at prevailing market rates.

Meant to spur conservation and increase power supplies, the idea ran into criticism from the Bonneville Power Administration, from publicly owned utilities and from PacifiCorp, Oregon's second-largest electricity provider.

Bonneville said the language would have allowed Northwest aluminum companies to earn a huge windfall from reselling BPA power, some of which the agency would have to buy at high prices on the open market. That in turn would force up rates for other customers, the BPA said.