Panel OKs Subpoenas for Energy Companies
The Senate Rules Committee agreed Monday to issue subpoenas to eight out-of-state power generating companies demanding documents on pricing, bidding and other aspects of electricity sales in the state.
Sen. Joe Dunn (D-Santa Ana), chairman of the special Senate committee that is investigating whether power wholesalers are illegally profiteering from California’s energy crisis, said he expects the companies to resist. That would set the stage for a court fight, he said.
In addition to subpoenas aimed at the private generating companies, the committee also put the Los Angeles Department of Water and Power on notice that unless it voluntarily provides information on its power sales to the state, the data will be subpoenaed as well. And the panel threatened to subpoena records of the state Department of Water Resources unless it turns over information on how it has spent more than $7 billion to keep electricity flowing in California.
Under Senate regulations, Dunn’s panel needed approval of the Rules Committee to issue the subpoenas.
Industry executives deny that they have broken any laws in selling electricity at premium prices to California’s financially strapped utilities and the state water department.
The subpoenas will be issued to Reliant Energy, which Gov. Gray Davis has publicly accused of price gouging, Dynegy Energy Services Inc., Williams Energy, Enron Corp., NRG Energy Inc., Duke Energy, Mirant Inc., and AES Corp.
Dunn said executives of the generators seemed cooperative when the investigation was launched two months ago. Since then, he said, they have raised barriers, including demands that the confidentiality of their documents be protected.
The demand for information from the Los Angeles DWP and the state’s water resources department were pushed by Sen. Ross Johnson (R-Irvine), vice chairman of the rules panel.
“Why are we not attempting to subpoena the Los Angeles Department of Water and Power? There certainly have been suggestions that they have profited,” Johnson said, referring to reports from the California Independent System Operator about large profits that DWP made by selling power to the rest of the state.
Reflecting the views of many lawmakers, Johnson said the Legislature also needs information on power purchases that the state water department makes from wholesalers and the bidding strategies used to make the bids.
Davis has refused to make details of the purchases public. He contends that if generators knew how much the state was spending on power, they might raise their prices. Several news organizations and a legislator are suing to make the information public.
Senate President Pro Tem John Burton (D-San Francisco), chairman of the Rules Committee, opposed issuing subpoenas to the city and state departments, at least temporarily, leading to the agreement for a one-week delay before subpoenas would be issued to the agencies.
The big energy companies also took a hit Monday from a leading advocacy group for the poor.
The Pacific Institute for Community Organization, a coalition of faith-based groups that has pressed for California to cover more of the millions of working citizens without any health insurance, voiced concern that the energy crisis is hitting the poor hardest.
The group, which scheduled a Capitol rally today, plans to urge political leaders to use the economic power of the state’s huge pension funds to leverage the companies.
The two pension funds own at least $1.2 billion in stocks and bonds in most of the major firms involved in the state energy crisis, from Enron of Texas to Duke of North Carolina, the advocates said.
“They could bring the voice of stockholders into the debate, as a major stockholder, and take a more enlightened view of what is happening to California,” said activist Jim Keddy. “We really have no voice inside those companies right now.”
