Energy outlook for West is bleak

Jessica Bujol

Friday, Feb. 2, 2001 | 11:22 a.m.

PORTLAND, Ore. -- If a solution to California's "dysfunctional" market is not found soon, the entire West could be in jeopardy when electricity use soars with sweltering summer temperatures, former Louisiana Sen. J. Bennett Johnston cautioned Thursday night.

"Where in the world is that electricity going to come from? I think you're going to be short," said Johnston, architect of the 1992 Energy Policy Act, the nation's last comprehensive energy law.

Johnston addressed a meeting of Western governors and legislators meeting to discuss the energy crisis.

Johnston cited several problems with California's faltering deregulation scheme. He said that retail prices were not controlled and that there were problems transmitting power between Northern and Southern California.

Governors and legislators from the Northwest agreed to try to tighten their grip on regional control of the Bonneville Power Administration and keep first rights to the electricity supplied by the federal power-marketing agency.

"It is an asset that could be seized at any time from outside the region," Washington Gov. Gary Locke said. "We need to keep this power and the benefits of Bonneville for the people of the Northwest."

"We are determined to stick together in the Northwest," Montana Senate President Tom Beck said.

The governors are from Oregon, Washington, Wyoming, Montana, Nevada, Utah, Idaho, Arizona and Alaska.

U.S. Energy Secretary Spencer Abraham and Curt Hebert Jr., chairman of the Federal Energy Regulatory Commission, are also participants in the summit, which continues today.

Oregon politicians are concerned about the increased cost of electricity for Oregonians.

Five members of the state's federal congressional delegation signed a letter urging Abraham to end the order requiring the sale of Northwest electricity to California utilities unless the federal government can guarantee those sales will be repaid. They also advised the FERC to institute price caps.

Oregon Gov. John Kitzhaber has said he favors temporary price caps on wholesale electricity, but the Bush administration has been reluctant to take that route.

During his speech Johnston said price caps now would secure a free market later.

"What it's going to take is an action by FERC to put caps on the wholesale market," he said. "When you have a dysfunctional market, you need an interim to get to a free market."

Though conservation efforts have been somewhat effective so far, Johnston said it would not be enough.

"There are trade-offs in all of this. The problem is that California made the wrong trade-offs. You have this idea that somehow energy comes from the tooth fairy and you don't have to plan for the future," he said.

Johnston said leaders shouldn't expect any easy answers.

"It's going to be expensive," he said. "It's going to be painful. It's going to be politically distasteful. But if you don't do something ... the buzzards are coming home to roost. I can see them circling."

California, with the sixth largest economy in the world, has to be rescued, he said.

"They're kinda crazy in California but they're worth saving and they're ours," Johnston said.