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Power Politics: In Era of Deregulation, Enron Woos Regulators More Avidly
Than Ever --- CEO Lay Leaves an Imprint On Bush Energy Plan, Seeks Friends at FERC --- An Interstate for Electricity The Wall Street Journal, 05/18/01 THE ENERGY CRISIS Above All, a Spark for Big Industry Los Angeles Times, 05/18/01 Chubu's Ota on Bush Energy Policy, Enron Proposal: Comment Bloomberg, 05/18/01 Suburbs boom as corporate invasion continues The Times of India, 05/18/01 Japan's Power Utilities Oppose Enron's Liberalization Proposal Bloomberg, 05/18/01 (bon pour tous) US energy companies closely tied to Bush administration: reports by Maxim Kniazkov Agence France-Presse, 05/18/01 UAE: Enron to pull out of Dolphin project Middle East Economic Digest, 05/18/01 USA: Bush power plan draws praise, dismay and coal. Reuters English News Service, 05/17/01 Power Politics: In Era of Deregulation, Enron Woos Regulators More Avidly Than Ever --- CEO Lay Leaves an Imprint On Bush Energy Plan, Seeks Friends at FERC --- An Interstate for Electricity By Bob Davis and Rebecca Smith Staff Reporters of The Wall Street Journal 05/18/2001 The Wall Street Journal A1 (Copyright © 2001, Dow Jones & Company, Inc.) WASHINGTON -- Every energy executive in America would have liked a half-hour with Vice President Dick Cheney as he fashioned the Bush administration's national energy program. Enron Corp. Chairman Kenneth Lay got it. Mr. Lay used the time to set out an eight-point agenda intended, among other things, to head off price controls on wholesale electricity, provide Enron and other energy traders with unfettered access to the nation's electricity-transmission system and remove regulatory obstacles to building new generating plants and power lines. The energy plan President Bush unveiled yesterday reflected many of those same priorities. In an interview last week, the vice president said he also met with other energy executives, but Mr. Lay was the only one he named. Mr. Cheney says he sought Mr. Lay's advice because "Enron has a different take than most energy companies." Indeed, Enron Corp. is a modern paradox. It has transformed itself over the past 15 years from a stodgy gas-pipeline operator into the nation's largest trader of gas and electricity and a formidable player in newer markets such as telecommunications services and emissions-reduction credits. Today, it's the quintessential model of a company dedicated to free markets. Yet as much as any company in the U.S., it has cultivated close ties with government. Since the late 1980s, the Houston-based company, which was President George W. Bush's biggest corporate campaign donor, has beefed up its lobbying staff, boosted its political contributions and sought out friends in the world of politics. Now, with Mr. Bush in the White House, it is in a unique position to see whether those efforts will pay off. Enron's lobbying blitz reflects one of the ironies of the era of deregulation. Just as government created immense telephone, electric and gas monopolies early in the last century, Enron and other players feel they need the government's help in opening up those monopolies and gaining access to once-closed markets. In particular, Enron wants the Federal Energy Regulatory Commission to ensure that energy is deregulated on terms favorable to the company. Rather than having the nation's transmission lines controlled by the utilities, it wants those lines to provide open access for new entrants such as Enron eager to buy and sell power. Mr. Lay is on a first-name basis with a half-dozen members of the Bush cabinet and knows many senior White House staffers from their days in the Texas governor's mansion with Mr. Bush. Before joining the administration, both White House economist Lawrence Lindsey and U.S. Trade Representative Robert Zoellick were on Enron's advisory board, which pays members an annual stipend of $50,000. Under Mr. Lay, Enron has donated nearly $2 million to Mr. Bush during his political career. Since the start of the 2000 campaign, Enron and its employees have contributed $1.3 million to the Bush presidential drive, the Republican Party and the presidential inauguration, says the Center for Responsive Politics. Enron also accounted for $461,000 in contributions during Mr. Bush's two runs for governor, according to the Center for Public Integrity. Mr. Lay, who holds a doctorate in economics, says all he wants from government is a fair shake. Enron supports candidates "you believe in," he says. "You believe in their value system, you believe in their philosophy and you believe they'll do the right things as leaders." But it's clear that Mr. Lay wants more than that from government. For now, he is focusing on FERC, where he worked in the early 1970s when the agency was known as the Federal Power Commission. He hopes to make FERC his ally in beating back the power of utilities. Long dismissed as a regulatory backwater overseeing wholesale transactions by electric and gas utilities, the commission has emerged as the chief navigator of the nation's transition to a fully deregulated energy marketplace. Even before Mr. Bush took office, FERC had begun to rein in the market power of utilities. In December, FERC told the nation's utilities that it wanted them to voluntarily surrender their high-voltage lines -- those that can dispatch electricity across state lines -- to independent grid operators, such as those already in place in California and the Northeast, which would provide open access to the lines. Although it told the utilities to submit plans for doing so, many of them have been reluctant to relinquish control of their lines to such independent organizations. Mr. Lay wants FERC to go further, forcing the utilities to cede direct control of their lines. He also is seeking rules that would end what he calls energy "balkanization" and create "seamless" interstate electricity markets. "Enron is the biggest gas and electric company entirely dependent on the competitive side of the business," says Andre Meade, an analyst for Commerzbank. "To the extent deregulation slows down, their business slows down." Right now it's a lucrative strategy. Enron typically targets tightly controlled markets just as they are opening up, using its financial clout and risk-management savvy to gain a dominant market position. In doing so, it frequently portrays itself as an insurgent taking on entrenched interests. In electricity, for instance, Enron buys the output of generating plants, sometimes days, weeks or years before the power is actually produced. Using sophisticated weather data, it determines the most lucrative market for the power, finds a buyer and then arranges delivery via transmission lines owned by others. It hedges its positions with other contracts. Its wholesale trading volume climbed 55% for natural gas and more than doubled for electricity in the first quarter alone. Such growth pushed Enron's wholesale energy-trading income, before taxes and interest, up more than threefold to $785 million during the first quarter. Between 1996 and 2000, Enron's yearly net income nearly doubled to $979 million and its revenue increased almost eightfold to $100.8 billion. Over the same period, Enron's stock price, adjusted for splits, rose more than fourfold. At the start of the Bush administration, FERC's future was very much up for grabs. Two of the five seats on the commission were vacant, and Enron quickly sought to fill them with activist Republicans. President Bush named a friend of his and Enron's to one of those seats: Texas utility-regulator Pat Wood. Mr. Wood had worked closely with Enron during a six-year effort to open Texas' retail electricity market. Mr. Wood also had shown the kind of backbone Enron wanted in a separate fight over telephone deregulation when he insisted on closely monitoring phone utilities to make sure they opened their networks to competitors. For the second slot, Enron backed Nora Mead Brownell, a Pennsylvania utility regulator. She had come to Enron's aid in 1997 when she voted to block an electricity-market restructuring plan backed by Philadelphia's utility and by GOP Gov. Tom Ridge. Enron argued that the plan would have locked it out of the Philadelphia market. Enron worked to raise Ms. Brownell's visibility by lobbying the House Commerce Committee to include her as an expert witness on energy issues and as a member of an informal advisory group, say Enron and congressional aides. Mr. Lay provided heavyweight support. He says Enron included Ms. Brownell's name on its "priority list" of a half-dozen prospective FERC nominees. And when her candidacy ran into opposition from Pennsylvania officials with bitter memories of her 1997 decision, Mr. Lay says he phoned Karl Rove, the White House's top political strategist, to tell him that "she was a strong force in getting the right outcome" in Pennsylvania." A White House spokeswoman says that a number of individuals and industry groups weighed in in favor of Ms. Brownell, but she declined to name any. Ms. Brownell says she was unaware of any concerted Enron campaign on her behalf. She didn't ask the White House who had supported her because, she says, "I didn't want to be beholden." Meanwhile, Enron was using its Democratic contacts to strengthen its ties with Linda Breathitt, a Kentucky Democrat on the commission. Earlier this spring, the company hired two of former Vice President Al Gore's closest friends as lobbyists: Nashville lawyer Charles Bones and Mr. Gore's campaign-finance director, Johnny Hayes. Both had come to know Ms. Breathitt through Democratic politics. Ms. Breathitt says she wasn't very familiar with Enron's interests, but that she accepted when Mr. Hayes invited her to dinner at a Washington restaurant in April to meet Richard Shapiro, Enron's managing director for government affairs. "Everyone likes to get to know the FERC commissioners," Ms. Breathitt says, adding that she always pays for her own meals. Enron has long played this kind of insider's game. Mr. Lay has been friendly with both Democratic and Republican administrations over the past 25 years, sharing time on the links with Presidents Bill Clinton and Gerald Ford. He's been a particularly close friend of the Bush family. In the late 1980s, he ran then-Vice President George H.W. Bush's fund-raising drives in Texas. After the younger Bush became governor, he appointed Mr. Lay to run the influential Governor's Business Council. Mr. Lay also made Enron's fleet of corporate jets available to the new governor and won his help in lobbying officials considering Enron projects. In March 1997, Mr. Lay wrote Gov. Bush to ask that he lobby the Texas congressional delegation to support export-finance credits critical to Enron, according to letters released by the Texas State Archivist's office. In April 1997, when Enron was negotiating a $2 billion natural-gas joint venture in Uzbekistan, Mr. Lay wrote to thank the governor for meeting with the Uzbekistani ambassador to the U.S. Six months later, another Lay thank-you note concerned a phone call Mr. Bush made to Pennsylvania Gov. Ridge to support Enron's plan to enter the Philadelphia electricity market. "I am certain it will have a positive impact," Mr. Lay wrote. Mr. Lay says he hasn't sought Mr. Bush's aid directly since Mr. Bush won the presidency. Last month, he talked with the president briefly at a Houston benefit for the Barbara Bush Foundation for Family Literacy, on which Mr. Lay serves as co-chairman. "It's not a matter of us going off hunting or fishing or sitting around and having drinks," he says. Not all Mr. Lay's initiatives have been successful. When Mr. Bush reneged in March on a campaign pledge to fight global warming by requiring reductions in carbon-dioxide levels produced by burning hydrocarbons, Mr. Lay says he telephoned Mr. Cheney to complain. "The scientific evidence, although certainly not conclusive, is pretty compelling that there could be a climate-change problem," he says he told the vice president. "The administration should still look very seriously at it." Around the same time, Mr. Lay also called Mr. Rove, the White House political adviser, to urge him to talk to Fred Krupp, the head of the moderate Environmental Defense Fund. Messrs. Krupp and Rove spoke briefly but found little common ground. Later, Enron, which has plans to add emission credits to the commodities it trades, joined a coalition urging mandatory reductions in carbon-dioxide levels. But Enron saved its main lobbying push for Mr. Cheney's energy task force. In April, Mr. Lay met with the panel's staff director, Andrew Lundquist, and later, with Mr. Cheney, whom Mr. Lay had come to know well when the vice president was chief of Halliburton Co., a Dallas construction company. "We built Enron Field together," says Mr. Lay, referring to Houston's new ballpark. In both meetings, say Enron and White House officials, Mr. Lay presented a broad agenda for opening up the nation's electrical system and used the gas-transmission system as a point of comparison. In both cases, he argues, pipelines and transmission lines should be like the federal highway system that offers easy access to all. The Cheney report uses similar language, describing the electrical grid as "the highway for interstate commerce in electricity." As Enron sought, the report directs the energy secretary to determine by the end of the year whether it makes sense to establish a national grid, and to identify bottlenecks in the transmission system as well as how to remove them. An effort to make the grid national would enhance FERC's power, as Enron has urged. The report is mum on some Enron concerns, such as requiring utilities to join regional transmission organizations, an idea strongly opposed by the utility industry. A White House aide says the task force didn't want to get involved in such battles between industries. As solid as its support in the White House has turned out to be, Enron is worried about the backlash against electricity deregulation in Western states and possibly in New York, should electricity rates surge this summer. Nevada repealed its deregulation law last month, spooked by the way skyrocketing wholesale-electricity prices in neighboring California were undermining the Golden State's economy. California and Oregon are contemplating state-government purchases of major utility assets. Enron's biggest fear is that the political pressure will lead the states, or perhaps Congress, to control prices, which could undermine Enron's business. In response, Enron has formed a coalition with eight other energy marketers in New York, who each have pledged $50,000 to pay for a media and lobbying campaign. It also has hired former Montana Gov. Marc Racicot and dispatched him to court Western politicians. Two weeks ago, Mr. Racicot had breakfast with an old colleague, Oregon's Democratic Gov. John Kitzhaber. After the two chatted about fly-fishing, says Mr. Kitzhaber, "Marc did say he was working to re-energize the discussion about energy and had some ideas for a framework the governors might want to consider." Though Mr. Kitzhaber says he knew that Mr. Racicot had joined the Washington, D.C., lobbying firm Bracewell & Patterson, Mr. Racicot didn't disclose that he was on retainer to Enron -- and the star of Enron's Western states "advocacy team." For his part, Mr. Racicot says he was working "not at Enron 's direction but with their knowledge" to advance positions that he, too, feels are important. --- Jeffrey White contributed to this article. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. National Desk THE ENERGY CRISIS Above All, a Spark for Big Industry STUART SILVERSTEIN; ELIZABETH SHOGREN; NANCY RIVERA BROOKS TIMES STAFF WRITERS 05/18/2001 Los Angeles Times Home Edition A-1 Copyright 2001 / The Times Mirror Company Promoted as a way to safeguard the nation's future, the energy plan unveiled Thursday by the Bush administration would heavily reward many of the stalwarts of the old economy. If Congress enacts President Bush's proposal, the major winners would include big oil and gas companies, coal producers and giant construction companies, as well as labor unions, energy experts said. Critics complained that the plan offers no more than modest incentives for firms specializing in renewable energy or energy-saving technologies. The story is the same for other interests, such as mass transit, that might have the potential to substantially change the way Americans live and work. But those left the most empty-handed probably are consumers and business owners who held out hopes for a quick fix for high electricity, gasoline and natural gas prices. Environmentalists and even property rights advocates also say they came away as losers. The plan's more than 100 recommendations are intended to encourage more domestic power production and the building of new oil refineries. It envisions more than 1,300 new power plants, including nuclear facilities, as well as more than 38,000 miles of pipelines and 263,000 miles of distribution lines. The plan calls for opening Alaska's Arctic National Wildlife Refuge to exploration for oil and natural gas, and some increased spending on research into cleaner-burning technologies. As a result, the plan could stimulate hundreds of billions of dollars of investment in energy infrastructure, said Chris Ellinghaus, an energy analyst at Williams Capital Group, a New York-based investment banking firm. Ellinghaus sees that money going to not just the large energy companies, such as Exxon Mobil Corp., and electricity producers--including Calpine, Reliant, Dynegy, Duke and Mirant--but also companies that make components for refineries, power plants, pipelines and transmission wires. "The trickle-down is going to be tremendous," Ellinghaus said. Most of the new business, however, is likely to go to the traditional energy industries--oil, gas, utilities and coal--that helped Bush raise more money than any other candidate in history, according to an analysis by the nonpartisan Center for Responsive Politics. Bush received $2.9 million from the energy and natural resources sector of the economy, which was among his leading contributors. By contrast, Democratic presidential candidate Al Gore received $328,000. Texas' Enron Corp. gave Bush $113,800, more than any other energy company. The nuclear power industry, which received a boost in the Bush energy plan, contributed $290,209 for his presidential bid. American Petroleum Institute President Red Cavaney acknowledged that members of his energy-industry trade group would be helped by the Bush plan. However, he said, such a plan, by increasing production, would help bring down energy prices--which in turn would benefit consumers and industries that use large amounts of energy. "At the end of the day, our members are helped when you have a healthy, strong economy and their customers are doing well," Cavaney said. Labor Unions See No Losers in End Bush administration opponents in organized labor offered only tepid criticism of the energy plan. Bill Samuel, legislative director for the national AFL-CIO labor federation, expressed concern that the Bush plan pays too little attention to the "immediate crisis faced by consumers" in California and elsewhere. But, he said, under any comprehensive energy plan to emerge from Washington, whether it is something resembling the Bush plan or a Democratic alternative, "I don't see any losers. . . . It would create jobs and much-needed energy." The Teamsters, for example, would benefit from proposed pipeline construction in Alaska. Likewise, the United Mine Workers could win from increased coal production, and an array of construction unions would profit from the building of new power plants and transmission systems. Californian consumers and businesses complained about the lack of relief from high electricity prices. Yet among the first to benefit from the plan would be power plant engineering companies, an industry dominated by such California-based companies as the Southland's Fluor Corp., Parsons Corp. and Jacobs Engineering, along with San Francisco's Bechtel Corp. Mark Stevens, head of strategic planning at Aliso Viejo-based Fluor, said he huddled with staff members Thursday to figure out where the Bush plan could mean increased business for the company. "In an initial glance, we came up with three areas: Alaska, coal-fired co-generation plants and conservation," he said. In Alaska, the company is already at work on "front-end engineering" for the planned natural gas pipeline that will bring gas from Prudhoe Bay to Alberta, Canada. Despite the warm rhetoric from the White House, the renewable energy industries generally consider themselves big losers in the plan. While extending the production tax credit to wind and biomass technologies, the administration refused to do the same for geothermal or solar power. "When you look at the net pluses and minuses, we've gotten recognition and some nice rhetoric, but the substance is still severely lacking," said Karl Gawell, executive director of the Geothermal Energy Assn., an industry trade group. He said most of the ideas the task force looked at--from promoting the use of renewable energies by government facilities to adopting a production tax cut for solar and geothermal--"were left on the cutting room floor." The Energy Department's research and development budget for renewables was cut 50% in Bush's budget request, and the industry was disappointed that the plan did not include a commitment to restore or increase federal investment to help level the playing field between renewables and other energy sources. "I think that is unfortunate because the area facing the most severe energy problems is the far West. California, Oregon, Washington, Nevada and Idaho are all facing severe problems right now," Gawell said. "These are states unlikely to build nuclear power plants. . . . These states don't have coal. But these states have a wealth of renewable resources." 'Missing Chapter on Climate Change' From the standpoint of environmentalists, the key issue was the plan's silence on carbon dioxide emissions and global warming. The United States has made international commitments to reduce its emissions of carbon dioxide, one-third of which come from power plants. "We're still looking for the missing chapter on climate change," said Jeremy Symons of the National Wildlife Federation. Rather than producing a plan to shrink emissions, the president is "putting out a plan that locks in a pathway of ever-increasing greenhouse emissions." A Cabinet-level commission is reviewing the Bush administration policy on global warming, but environmentalists said the energy report signals that no serious effort will be made to cut emissions of carbon dioxide and other greenhouse gases. The auto industry might get a boost from the plan's provision for tax credits for purchasing hybrid-powered cars and trucks, but not soon. The benefits will go to relatively few consumers at the start. * Silverstein and Rivera Brooks reported from Los Angeles and Shogren from Washington. Times staff writers James Flanigan, Jerry Hirsch and John O'Dell contributed to this story. PHOTO: The most likely vehicle for Senate action on President Bush's plan is a bill controlled by Sen. Frank H. Murkowski (R-Alaska), center, who favors drilling in the Arctic National Wildlife Refuge.; ; PHOTOGRAPHER: Associated Press Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Chubu's Ota on Bush Energy Policy, Enron Proposal: Comment 2001-05-18 07:13 (New York) Tokyo, May 18 (Bloomberg) -- Hiroji Ota, chairman of Japan's Federation of Electric Power Companies and president of Chubu Electric Power Co., comments on U.S. President George W. Bush's national energy policy and Enron Corp.'s proposal to separate transmission network from power generation in Japan. Bush's energy policy, proposed yesterday, promoted nuclear energy by easing regulatory barriers to construction of new plants and the expansion of existing ones. On U.S. energy policy: ``Because the U.S. has plenty of resources, there were few voices (in the past) to support nuclear power. An energy-stricken country, Japan already knew we have no choice but to use nuclear power. There were many events that triggered the U.S. to change its energy policy (such as) the California crisis, higher fuel prices and so on.'' On Enron Corp.'s proposal to separate generation, transmission and distribution of electricity in Japan and to create an indecent regulator for the energy market: ``The proposal is not a good idea. They say deregulation is only a means to an end -- to bring competition. But if you break up electricity business, no one will take any responsibility for supplying energy to consumers. ``Look at the California crisis. Generators, including Enron, made a fortune but without having any supply responsibility. I don't want that to happen in Japan. ``Even though Enron has proposed an `unbundling' plan by setting up a holding company over the regional power companies, it doesn't work that way. It may work when you discuss the company's management and all that, but when you handle daily operations, you can't wait for problems or issues to go up to the management before they can be sorted out.'' On whether to sell a stake in Electric Power Development Co. Electric Power Development, a power wholesaler two-thirds owned by the Ministry of Finance with the remainder held by nine power companies, plans to sell shares on the Tokyo Stock Exchanges as early as 2003. ``I'm not looking for short-term returns. If something is related to the public utility business, we have to take care of our customers, shareholders, employees and the residents of our region.'' Suburbs boom as corporate invasion continues Staff Reporter 05/18/2001 The Times of India Copyright (C) 2001 The Times of India; Source: World Reporter (TM) MUMBAI: Stabilisation in the residential sector, firm prices in the commercial scene and a booming entertainment sector, are all set to give a new dimension to the real estate scenario in Mumbai. These are some of the observations in a recent research report by Insignia Brooke, one of the world's best-known real estate advisors. Residential prices are quite firm in Bandra (W), Andheri (W) and Versova due to companies moving to the suburbs. This is the result of the corporate transition towards the western suburbs area. As a repercussion of that, prices in South Mumbai are stable. Demand for residential accommodation in Andheri and Bandra have picked up in the last quarter. However, there is a serious shortage of premium quality accommodation. As a result, rental values have shot up by around 25 to 30 per cent for select buildings in these areas. The ruling effective lease rental in the Bandra area is around Rs 30 to 35 per square foot per month. The report states that the demand would continue to increase, owing to the housing loan tax sops announced in the 2001 budget and the possible reduction in housing loan rates. On the supply side also, developers like the Rahejas, Ajmeras and Hiranandanis are already on the drive in developing areas like Malad Link Road, Andheri (W) & Kandivali and Powai, respectively. Commercial prices have also firmed up since corporates desire to relocate to the western suburban areas or the Prabhadevi-Worli region. Recently, a major deal was struck between Enron and Kamala Mills, whereby the former leased 1 lakh square feet of office space at Kamala Mills compound, Lower Parel, for an effective rent of Rs 70 per square feet, per month. An 'A' grade building in Andheri-Kurla like the Technopolis Park currently commands an effective rent of Rs 100 to 150 per square feet of useable area per month, whereas B grade buildings in Akruti Software Park and Acme Plaza rent out at Rs 35 to 40 and Rs 40 to 50 per square feet, per month, respectively. The new twin CBDs of Bandra-Kurla and Andheri-Kurla are slowly diminishing in terms of real estate prices. Brooke researchers feel that the impact of the America's IT slowdown on the real estate demand in India is yet to clearly emerge. Global Telesystems has acquired around one lakh square feet at the Millennium Business Park (Mhape), in Thane district. In a move aimed at promoting start-up infotech ventures in the state, the Maharashtra government has announced the formation of Samruddhi Venture Park. The project aims to provide complete assistance to start-up ventures under one roof. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Japan's Power Utilities Oppose Enron's Liberalization Proposal 2001-05-18 06:53 (New York) Japan's Power Utilities Oppose Enron's Liberalization Proposal Tokyo, May 18 (Bloomberg) -- Japan should reject a proposal by Enron Corp. to foster competition by splitting electricity generation and transmission because it may lead to California- style power failures, the chairman of Japan's Federation of Electric Power Companies said. Enron, the world's largest energy trader, said allowing Japan's utilities to continue generating, transmitting and distributing electricity would discourage rivals from entering Japan's 15 trillion yen ($122 billion) electricity market. The Japanese government has said it wants to liberalize the power market, the second-largest behind the U.S. Power supply is currently dominated by 10 regional utilities and Japanese manufacturers pay the world's highest electricity charges. ``If electricity business are broken up, no one will take final responsibility to supply energy to consumers,'' said Hiroji Ota, who is also president of Chubu Electric Power Co., the nation's No. 3 utility. ``Power generators in California made a fortune, with no responsibility for supply. I don't want to see that happen in Japan.'' California has spent about $7 billion this year buying electricity on behalf of its utilities after a shortage of supply from generators caused wholesale prices to soar, prompting power failures and pushing the state's two largest utilities to the brink of insolvency. Liberalization in Japan would help manufactures save an annual 4 trillion yen and help them to better compete with global rivals, said Nicholas J. O'Day, Enron Japan Corp.'s vice president of public affairs. In 1996, the government began liberalizing the market by opening wholesale trading to competition. In March last year it allowed large business customers such as factories and hospitals, representing about one-third of the Japanese power market, to buy from independent power producers. Enron plans to build a natural gas-fired power plant in Japan to become the first overseas generator in the market. The change in regulation has forced the 10 large regional power companies, which have dominated the highly restricted Japanese power market with some of the world's highest electricity charges, to cut charges. (bon pour tous) US energy companies closely tied to Bush administration: reports by Maxim Kniazkov 05/18/2001 Agence France-Presse (Copyright 2001) ATTENTION - ADDS detail, background WASHINGTON, May 18 (AFP) - US energy companies, which are expecting a windfall from President George W. Bush's energy plan, lavishly financed Republican political campaigns last year and maintain close ties to several key members of the Bush cabinet, according to data released by watchdog groups. Oil and gas companies gave Republican politicians 25.5 million dollars, almost four times as much as they gave Democrats, according to figures obtained by the Center for Responsive Politics. The nuclear power industry, which is expected to get a boost as a result of Bush's new energy policy, was not idle either. It gave more than 13.8 million dollars to federal candidates and committees in the 2000 election cycle, said the center, pointing out that supporters of the new Republican president received 290,209 dollars from the industry to campaign on his behalf. Overall, the nuclear industry favored Republicans, giving them more than two-thirds of its individual, political action committee and "soft money" contributions, according to the center. "Soft money" are unregulated donations to political parties designed to promote causes rather than individual candidates. But they are often used to indirectly back up platforms put forward by candidates. "The president and members of Congress have been very successful at drilling for political contributions from the energy sector," remarked sarcastically Scott Harshbarger, president of Common Cause, another watchdog group. Electric utilities gave the Republican and Democratic parties 10.1 million dollars in "soft money" contributions during last year's election campaign, according to Common Cause. Energy giant Enron alone shelled out more than 1.4 million dollars, the group said. The new energy policy announced by the president Thursday calls for building between 1,300 and 1,900 new power plants, thousands of miles of new pipelines and new oil refineries over the next 20 years. Tax incentives are envisioned for energy companies that will implement the president's plan. "Big time donors get major league payback, non-donors get higher energy bills and a dirtier environment," commented Harshbarger. It is widely known that before launching into politics Bush cut his teeth in the oil business. Vice President Richard Cheney was chief executive at Halliburton, the world's largest oil field services company, before he joined the Bush campaign last year. Less publicized have been energy industry ties to several other key members of the Bush cabinet, according to the Center for Responsive Politics. Commerce Secretary Don Evans spent 25 years at Tom Brown Inc, a Denver, Colorado-based oil and gas company ,and also sat on the board of TMBR/Sharp Drilling, an oil and gas drilling operation, said the center. Interior Secretary Gale Norton represented Delta Petroleum when she worked for Brownstein Hyatt and Farber, a Denver law firm. Meanwhile, Energy Secretary Spencer Abraham received more than 700,000 dollars for his failed Senate re-election bid in 2000 from contributors like General Motors, Ford and Lear Corp, which are closely connected to the energy sector, according to the center. mk/fgf Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. UAE: Enron to pull out of Dolphin project 05/18/2001 Middle East Economic Digest Copyright (C) 2001 Middle East Economic Digest; Source: World Reporter (TM) The US' Enron Corporation is to relinquish its stake in Dolphin Energy (DEL), the joint venture company formed to develop the Dolphin gas project. DEL is a Jersey-registered company, 51 per cent owned by the Abu Dhabi-based UAE Offsets Group (UOG). The remaining 49 per cent is split equally between France's TotalFinaElf and Enron. In March 2000, the three partners signed a project development agreement (PDA), which stated that TotalFinaElf would be responsible for the upstream element, which would involve developing a block in Qatar's North field, and Enron would be the midstream partner, responsible for building a gas pipeline to Abu Dhabi, Dubai and Oman, gas marketing and project management (MEED 10:3:00). Industry sources say that Enron's plan to give up its stake in DEL is part of a new business model developed by the company. The sources suggest that there is another factor affecting Enron's decision to pull out of DEL. "The profit margin for Enron would be low. At present, the Dolphin project is being developed primarily as an upstream initiative," says one. The fate of Enron's stake in DEL remains unclear. UOG has not been forthcoming with explanations, but an official statement is expected by the end of May. Some sources suggest UOG will take over the stake of Enron in DEL, but the possibility remains that another company might be invited into the joint venture. "There is talk of new partners," says a TotalFinaElf official. "But whatever happens, we are staying." Enron officials declined to comment. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. USA: Bush power plan draws praise, dismay and coal. By Deborah Zabarenko 05/17/2001 Reuters English News Service (C) Reuters Limited 2001. WASHINGTON, May 17 (Reuters) - Power suppliers praised the Bush energy plan on Thursday, as California's governor slammed the proposal for letting "price-gouging" continue and environmentalists showed their displeasure by dumping coal outside Vice President Dick Cheney's home. In Europe, Jan Pronk, head of the United Nations forum on climate change, dubbed it a "disastrous development." Around around the world, markets were largely unchanged by the Bush plan, as it dealt primarily with long-term policy. The U.S. national energy policy, formally unveiled by President George W. Bush in St. Paul, Minnesota, called for heavier reliance on oil, coal and nuclear power and $10 billion in tax credits for conservation. California Gov. Gray Davis, who has repeatedly blasted the Bush administration for failing to aid his state during a season of blackouts and soaring power bills, lashed out at the plan for "turning a blind eye to the bleeding and hemorrhaging that is taking place in this state." "By not doing anything, you're allowing the price-gouging energy companies, many of whom reside in Texas, to get away with murder," Davis said in an apparent dig at Bush, the former Republican Texas governor and a former oil executive. The plan sparked a partisan firestorm on Capitol Hill, where Republicans vowed to help implement Bush's plan and Democrats criticized it as a giveaway to special interests with little relief in sight for consumers. House of Representatives Republican Whip Tom DeLay of Texas blamed the "energy crunch" on eight years of inaction by President Bill Clinton's administration, and hailed Bush for moving to "unify our nation around a comprehensive energy strategy that protects our consumers and strengthens our national security." House Democratic leader Richard Gephardt of Missouri shot back: "We think the president's plan makes the wrong choices for America and for the American people." EXXON, BP RESERVE JUDGMENT ON PLAN Among those in the energy business, the plan drew broad approval, even though some worried about a tilt toward the supply side. "I applaud the administration for taking these steps to encourage more energy development in this country," said Robert Allison Jr., chairman and CEO of Anadarko Petroleum Corp., one of the largest independent exploration and production companies in the United States. Two of the world's the largest oil companies - Exxon Mobil Corp. and BP Plc - said they would reserve judgment until they studied the plan more closely. But Kenneth Woodcock, senior vice president of AES Corp., one of the world's biggest power suppliers, criticized the proposal: "This plan gets the government pushing too far on the supply side versus conservation and the environment, which isn't really the best path toward a balanced electricity and energy market." Many in the U.S. environmental community claimed the plan would harm public health by dirtying the air or destroying designated wilderness areas, and said long-term measures would be costly and offer no short-term relief to consumers facing power shortages and record-high gasoline prices this summer. "The president's plan won't produce affordable energy for Americans now, or 10 years from now," said Philip Clapp, president of the National Environmental Trust. "What the president's plan will do is drive up air pollution in our cities and turn the last 5 percent of our public lands that we've protected for future generations over to the oil and coal companies." Greenpeace activists dumped five tons of coal and five fake drums of oil and nuclear waste outside the official residence of Vice President Cheney, the former top executive of oilfield services giant Halliburton, who headed a task force that developed the plan. The drums were labeled with the logos of Exxon/Mobil, Chevron, Texaco, BP and Enron. Sierra Club protesters trailed Bush as he swung through Minnesota and Iowa, holding news conferences at coal-fired power plants to offset what they termed misleading appearances by Bush at environmentally friendly facilities used to promote the White House recommendations. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.
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