>>>>>The power pirates--many of them pals and political patrons of Cheney and President Bush--were reaping profits of 400% to 600%. The cost of electricity that private utilities (Edison, PG&E, SDG&E) were sending consumers soared from $7.4 billion in 1999 to
$27.6 billion in 2000 and seemed headed for $70 billion in 2001.
Demand had not been up significantly; indeed, it then was falling. Supplies were rising.
There was a magic wand Washington could wave. And it finally did get waved in June after dogged goading by Gov. Gray Davis, other West Coast Democrats and a new Democratic U.S. Senate. The wand was regional price caps, imposed by the Federal Energy Regulatory Commission.
Those caps--so abhorred by the Bushies--worked with new long-term power contracts negotiated by Davis, plus a mild summer, to quash the energy crisis.
Megawatts that had sold for $321--and frequently exceeded $1,000--were capped at $92. They soon slid to $60 and now are back down to $30. That's about where they were when California naively set out on its ill-fated deregulation venture, which shifted control over most electricity from the state Public Utilities Commission to the pro-profiteer FERC.
Despite Cheney's glum prophecy, there were no rolling brownouts last summer, nor have there been any since.
Rather than the feared $70-billion electricity bill, the tab last year again was about
$27 billion. Still, if you assume that 1999's $7-billion charge was reasonable, it means the gougers--most of them out-of-staters--sucked $40 billion in excess profits out of California over a two-year period. They broke Edison and PG&E and forced the state into the power-buying business.
Davis is asking FERC to order refunds totaling $9 billion.
Now comes the smoking gun, the Enron internal memos disclosed by FERC that show clear evidence of market manipulation. The documents indicate that not only Enron, but other companies were fleecing Californians by driving up prices and triggering blackouts. The Enron sharpies had brazenly dubbed their strategies Death Star, Fat Boy and Get Shorty.
One particularly galling scheme was to buy electricity produced by California plants during blackout threats and sell it for huge profits in Oregon.
The California public--<and Governor Davis> --had it right after all: The shortage was not real, it was contrived by the power pirates
This is going to be the most egregious example in history of greedy and unethical corporate interests--with the complicity of the U.S. government--going into a state and raping it economically," says Garry South, Davis' chief political strategist.
Davis' problem is that although a smoking gun was found, he already had been seriously wounded. His job performance rating plummeted a year ago because of the energy crisis and never has recovered. (Approval 42%, disapproval 49% in the latest Field poll.)