The Bush administration faces growing, angry questions from Capitol Hill on its close ties to Enron last year while the Houston energy trader was “gaming” the California electricity market fleecing ratepayers of as much as $30 billion in overcharges.
Sen. Byron Dorgan (D-N.D.), chair of the Senate Commerce Committee, has called for the appointment of an independent counsel to investigate Enron’s practices in California, with code names like “Death Star,” “Fat Boy,” “Get Shorty” and “Load Shift.”
“It is disgusting corporate behavior without a moral base and does represent a culture of corruption,” Dorgan said May 15. He announced he would summon U.S. Army Secretary Thomas White, a former Enron Vice President who sold off his $50 million in Enron stock before it collapsed, to testify.
Rep. Henry Waxman (D-Calif.) fired off a letter to Vice President Richard Cheney recently demanding an explanation for a May 4, 2001, e-mail from Karen Knutson, deputy director of Cheney’s Energy Policy Task Force (EPTF), pleading with a colleague to avoid discussion of California’s energy problems in the EPTF’s final report.
“We are desperately trying to avoid California in this report as much as possible,” said Knutson’s e-mail, which was addressed to Jacob Moss at the Environmental Protection Agency.
Waxman, a ranking member of the House Committee on Government Reform, told Cheney that the e-mail had been forwarded to him by EPA.
Waxman protested the heavy redactions making it impossible to determine the context of Knutson’s comments. In fact, the final report from Cheney’s Task Force was widely criticized for hardly mentioning the California energy crisis except to blame it on “inadequate electricity supplies.”
Writes Waxman, “The report makes no mention, however, of the role of energy traders like Enron or market manipulation in the crisis.”
These revelations are troubling, Waxman writes, in light of the memoranda released by Enron a few weeks ago laying bare the manipulation of the California electricity market by Enron, Duke Power, Dynegy, Reliant and other energy traders.
“For much of the first half of 2001, public officials in California and Congress – myself included – urged the administration to take some action to investigate serious allegations of market manipulation by power sellers out West,” Waxman wrote to the Vice President. “These urgent requests were consistently rebuffed.”
Waxman adds, “Congress and the public – and Californians in particular – are entitled to a complete explanation of the administration’s failure to take prompt and effective action to protect Western consumers from price gouging and market manipulation.”
A Cheney spokeswoman, attempting to explain the report’s silence on California claimed that its aim was to lay out a “strategic, long-term energy policy for the country … not to focus on short-term problems specific to a state.”
Waxman told Cheney he had obtained an earlier draft which included a section titled “Regional Energy Dislocations.” The text reads, “California’s energy/electricity problems are to be an area of specific focus in discussing the Southwest region’s energy problems.” But that was deleted from the final report.
Waxman’s letter continues, “I continue to find it puzzling that the administration would have abandoned its plans to address the most pressing energy crisis facing the country. I would therefore appreciate your … explaining why the final task force report deleted the discussion of California’s energy problems.”
Waxman adds, “The appearance created by these documents is that the administration was indifferent to the plight of millions of Californians facing rolling blackouts and inflated natural gas prices.”
Waxman also sent a letter to Sen. Joseph Lieberman (D-Conn.), chair of the Senate Governmental Affairs Committee, accusing the Bush administration of lying about its contact with Enron officials. In response to Waxman’s inquiries, Cheney admitted only six contacts between White House officials and Enron. But Cheney wrote to Lieberman May 22 admitting “at least 24 contacts between Enron and White House officials.”
Sen. Dianne Feinstein (D-Calif.) released a memo sent to the Federal Energy Regulatory Commission (FERC) by Southern California Edison last August 17. It described in detail the conspiracy by Enron, Duke Power and other energy traders to “game” California’s electricity market. Kept secret by FERC, the memo was leaked to Feinstein by Edison.
“What happened to this memo?” Feinstein demanded. “Who was the highest authority who reviewed it? And what action did FERC take?”
The author can be reached at greenerpastures21212@yahoo.com
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