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Enron Mail |
Hi Katie:
Thought IEP folks might be interested. Best, Jeff Wednesday March 14, 12:22 pm Eastern Time US Senate rejects California utility bankruptcy measure By Patrick Connole WASHINGTON, March 14 (Reuters) - The U.S. Senate on Wednesday rejected a bid to force California utility companies to repay power generators for electricity they bought under a federal government sales order, even if utilities go bankrupt. In a motion on the Senate floor, lawmakers killed an amendment to a broader bankruptcy reform bill that opponents said was a dangerous proposal that would have opened the door to involuntary bankruptcy filings by troubled California utilities. The utilities in question are PG&E Corp.'s (NYSE:PCG - news) Pacific Gas & Electric and Edison International's (NYSE:EIX - news) Southern California Edison. The amendment was sponsored by Oregon Democrat Sen. Ron Wyden, Montana Democrat Sen. Max Baucus and Oregon Republican Sen. Gordon Smith. Proponents said the measure would have protected the customers of the federally-owned Bonneville Power Administration and other Northwest utilities from unfair rate increases due to the California energy crisis. ``I don't think it's fair for consumers in other Western states to get caught holding the bag if California utilities take our power and then run into bankruptcy court to avoid their debts,'' Wyden said. ``The Northwest has been more than a good neighbor to California during this crisis,'' he said. Interestingly, the California Senate delegation was split on the matter. Democrat Dianne Feinstein opposed the amendment, while fellow Democrat Barbara Boxer supported it. Feinstein called the proposal a ``dangerous amendment'' that would create two classes of creditors and ``probably force an involuntary bankruptcy.'' The broader bankruptcy reform bill is expected to be approved by the Senate by the end of the week. Separately, talks between California and its three investor owned utilities on a deal under which the state might buy their transmission assets continued this week with no deal in sight. The state is negotiating with PG&E and Edison, along with Sempra Energy (NYSE:SRE - news) unit San Diego Gas and Electric. The deals are aimed mainly at pumping money into PG&E and SoCal Edison to keep them out of bankruptcy after they recorded about $13 billion in red ink since last spring, paying sky-high prices for power in the wholesale market. PG&E and SoCal Edison, under the terms of the state's disastrous experiment with market deregulation, have been able to pass on to their retail customers only a fraction of their power purchase costs.
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