January 31, 2001
12:00 AM
WASHINGTON, D.C. - Chairman Frank H. Murkowski today warned that as bad as the energy situation in California is, it may get worse. “California’s problems are affecting everyone connected to the grid - - the entire West, and I fear that the worst is yet to come. It is anyone’s guess what will happen this summer when the air conditioners are turned on,” said the Chairman. “California created this problem by betting that it could rely on electricity produced in other states to meet its growing demand, but the fact remains that no major power plant has been built in California for more than a decade,” Murkowski said. He cited as an example, a high tech support company in Silicon Valley, California that fought construction of a new power-plant near its corporate office building. The irony, he noted, was that an electricity dependent high-tech company was blocking the construction of an electric generator that it would eventually need. Murkowski explained that with Northwest reservoir levels at an all time low, even less power will be available for California to import. The current situation is also the result of California’s scheme of partial deregulation - - deregulate wholesale prices and continue to regulate retail sales. Chairman Alan Greenspan recently noted that power can be supplied in a regulated market or a deregulated market, but that you cannot try and mix the two. Greenspan warned that the California energy crisis threatens the Nation’s economic expansion. “California also needs to look to the future. It needs to recognize that electricity does not appear magically at the plug - - it comes from generators. Nuclear, coal, hydro, natural gas, wind and other renewables,” said Murkowski. “If California expects to achieve a meaningful solution to their problems the path is clear - - allow new generation and transmission to be built. You can’t have the State take over the industry and try to run it.” “There is a lesson here for the federal government. For too long, we haven’t had an energy policy. What California has taught us is we can not rely upon others to provide our energy security. It is high time we have one so that consumers and industry have the energy needed to sustain our economy and way of life,” Murkowski said. ###