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The Whistleblower

The Whistleblower #7 - Mar 04, 2002

Daschle's Energy Plan: Deregulation, Enron-style. With the high-profile disclosures of Enron's twisted business dealings, you'd think that Senators would steer clear of an energy bill that paves the way for less accountable energy companies. Especially after deregulation brought California to the brink of fiscal collapse last year. But this week, U.S. Senate Majority Leader Daschle (D-SD) and his colleague Bingaman (D-NM) will try to shove federal electricity deregulation through the Senate. Their "Energy Policy Act," cloaked with some environmental amenities (see below), would repeal the Public Utilities Holding Company Act (PUHCA) of 1935, which prevents big interstate utilities from exercising monopoly power. The repeal of PUHCA would give energy companies the ability to buy utilities and merge with one another to form ever-larger, more powerful companies with no mandate to provide quality service to their customers. It was after winning an exemption from PUHCA regulations in 1994 that Enron was able to become a major gouger in energy markets. The protections against energy industry consolidation and market dominance would be replaced merely with government officials' "access" to power company books. And recent events have shown us that access to company records can be severely limited by a company's access to a paper shredder. Enron and the California crisis demonstrate clearly that we need more energy company accountability, not less. Scandal notwithstanding, it's business as usual in DC. Call your Senator and urge them to vote no on the energy deregulation proposal to be amended into S. 517, the Daschle-Bingamen Energy Policy Act. In a ramrod job, they intend to detour a committee hearing on the plan and force a Senate floor vote.

NRDC: Greenwashing again. The Natural Resources Defense Council (NRDC) was a lynchpin for passage of the California deregulation law, providing environmentalist cover for a $28 billion nuclear bailout and the disposal of regulatory controls over the energy industry. Now they want to do for the U.S. what they did for California, as the group has declared its support for the Daschle-Bingaman energy plan, despite its anti-consumer, pro-energy industry deregulation provisions. They may claim the environmental moniker, but NRDC can't see the forest for the trees.

California PUC should not become "Peevey-C". Rumor has it that California Gov. Davis is thinking about appointing Michael Peevey to fill Richard Bilas' seat when he steps down from the Public Utilities Commission at the end of this week. Peevey's appointment would be disastrous for consumers, as the energy executive is steeped in potential conflicts of interest. For starters, Peevey is a former President of Edison International and Southern California Edison, which is regulated by the PUC. One of his recent ventures, New Energy, Inc., was sold in 1999 for approximately $100 million to energy giant AES (a power profiteer fined last year for market manipulation in California). Peevey is currently a director of Excelergy, a company that profits from deregulation of power markets. Excelergy's clients include Sempra Energy, whose subsidiary San Diego Gas and Electric is regulated by the PUC. Also on the list of clients is Allegheny Energy Services. Both Allegheny and Sempra are named in the PUC's complaint to the Federal Energy Regulatory Commission seeking to overturn overpriced long-term power contracts. Peevey's pedigree makes him a wholly inappropriate choice for Public Utilities Commissioner.
The Foundation for Taxpayer and Consumer Rights (FTCR) is a non-profit, non-partisan advocacy organization. For over a decade FTCR and its advocates have exposed and challenged injustices that betray the public trust. The Whistleblower newsletter addresses core issues of the corporate and governmental crises of today and blows the whistle on the brewing fiascos of tomorrow. FTCR does not take a position on candidates for any elected office.

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2002 FTCR

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