*GOP Challenger To Calif Davis Gets Tough With Energy Cos
DOW JONES NEWSWIRES
(This article was originally published Friday)
RANCHO MIRAGE, Calif. (DOW JONES)-The leading Republican gubernatorial challenger to California Gov. Gray Davis told a roomful of energy company employees Thursday that if he wins the race this year, he will make their companies renegotiate electricity contracts with the state.
"A lot of you were the recipients of these flawed contracts," former Los Angeles mayor Richard Riordan said in a speech at a Western Power Trading Forum conference. "As governor I'll sit you down and renegotiate these contracts....I want you to be successful, but not on the backs of Californians."
At issue are $43 billion in long-term electricity deals which were signed by the state at the height of its energy crisis last year, and which many now say are overpriced.
Not surprisingly, Riordan's comments elicited a chilly response from conference attendees.
"He just lost a few votes right there," said a representative from one energy company who asked not to be named.
Several polls have shown Riordan to be the frontrunner Republican candidate, with Secretary of State Bill Jones and businessman Bill Simon lagging behind. So far, all indications are that a Riordan/Davis matchup would be a tight race.
In his speech, Riordan said he wanted to combine all of the state agencies that deal with energy into one department to increase accountability, and implement real-time electricity metering on a massive scale. Real-time meters show customers how much energy is costing in a given hour so they can moderate usage accordingly. "I want to see real-time metering in every house and business in the state," Riordan said.
Wholesale rates will be kept in check by the metering, but some regulation of retail electricity rates will still be necessary, Riordan said. He also said he favored connecting the electricity grids of the Western states. When asked about the Chapter 11 bankruptcy filing of PG&E Corp (PCG) unit Pacific Gas & Electric, Riordan described it as "a cover", and said the utility should retain the same level of regulation it had before the filing. The utility's reorganization plan seeks to tranfer assets to newly-formed companies that would be beyond the reach of state regulators.
Several conference attendees said they were unsure if Riordan would be an improvement over Davis, who frequently villified generators last year as "profiteers" for allegedly overcharging for wholesale power.
But Gary Ackerman, executive director of the WPTF, said Riordan's experience as a businessman made him preferable to Davis.
"Riordan would be an improvement because he is a businessperson, and he's willing to listen, unlike Davis," Ackerman said.
-By Jessica Berthold, Dow Jones Newswires; 323-658-3872; jessica.berthold@dowjones.com
Updated February 22, 2002 8:15 a.m. EST |
