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Surplus of Finger-Pointing In California Energy Crisis
The New York Times, 06/05/01 Price-Curb Plan: Is It California Dreaming? --- Regulators Again Tackle Power Market That Remains Chaotic The Wall Street Journal, 06/05/01 TUNED IN 'Blackout' Tries to Shed Light on Crisis Los Angeles Times, 06/05/01 Energy Alley to blame for California's woes? Houston Chronicle, 06/05/01 PBS pledge drive alters schedule Houston Chronicle, 06/05/01 PBS Shines Light on Energy Crisis AP Online, 06/05/01 Senate to subpoena documents from power generators Associated Press Newswires, 06/05/01 Panel OKs Subpoenas for Energy Companies Electricity: Special state Senate committee will demand pricing information in inquiry into whether California has been gouged. Los Angeles Times, 06/05/01 Enron's Indian Creditors Seek to Save Dabhol Project (Update1) Bloomberg, 06/05/01 ASIA-PACIFIC: Enron 'frustrated' by talks Financial Times; Jun 5, 2001 New Securities Issues The Wall Street Journal, 06/05/01 India Lenders Mtg Seeks To Salvage Enron Dabhol Pwr Proj Dow Jones Energy Service, 06/05/01 Developments in California's energy crisis Associated Press Newswires, 06/05/01 Marathon joins Saudi gas venture Houston Chronicle, 06/05/01 India: Verbatim Business Line (The Hindu), 06/05/01 Domtar buys G-P mills for $1.65B The Daily Deal, 06/05/01 World Watch The Wall Street Journal, 06/05/01 Environmentalists, Texas company in dispute over power money Associated Press Newswires, 06/04/01 Newsprint Prices Seen Down As Weakness Persists In May Dow Jones Commodities Service, 06/04/01 Alliance for Retail Energy Markets Media Statement In Response to the Assembly Democratic Caucus' ``Fair Plan'' Business Wire, 06/04/01 PBS Documentary Goes Inside the Utilities CNN: Live This Morning, 06/04/01 Bush Aide, Ethics Agency Differ Over Stock Sale Delay (Update1) Bloomberg, 06/04/01 Marathon Gets Enron's 20% Stake in Saudi Gas Project (Update1) Bloomberg, 06/04/01 Business/Financial Desk; Section A Surplus of Finger-Pointing In California Energy Crisis By RICHARD A. OPPEL Jr. 06/05/2001 The New York Times Page 1, Column 1 c. 2001 New York Times Company Natural gas prices have plunged in the last few months -- everywhere, that is, but Southern California. While gas in New York costs about $4 per thousand cubic feet, gas delivered to Southern California still costs more than $11 wholesale. That such numbers demand an explanation was about the only thing President Bush and Gov. Gray Davis could agree on when they met in Los Angeles a few days ago to discuss California's energy crisis. Mr. Bush assigned Patrick H. Wood III, a fellow Texan confirmed last month as a member of the Federal Energy Regulatory Commission, to investigate. To many experts, the woes of California's natural gas market are as profound as those of its electricity market: the state is short on pipelines, and the rules of the gas market, critics say, encourage sellers and traders -- including the biggest local gas utility -- to drive prices higher. At peak times, half of California's electricity is generated by gas-fired power plants, a higher proportion than in most parts of the country. And because 85 percent of the gas consumed in California comes from outside the state, the shortage of pipelines both into California and within the state has become a big handicap in fueling those plants. The strain has become especially acute as drought in the Pacific Northwest has curtailed imports of hydropower and gas-fired power plants have worked overtime to meet the demands of a booming state economy. Vice President Dick Cheney's energy policy report last month proposed initiatives to speed approval and construction of new pipelines, noting that New England and other regions faced capacity squeezes, too. The report says that the United States needs 38,000 miles of new gas transmission pipelines, almost a 20 percent increase. In the meantime, some industry executives and public officials take the argument one step further than the Bush administration, contending that today's shortage of capacity has made it possible for energy companies, intent on maximizing profits, to manipulate prices. ''It really strains credulity to say this is a functioning market,'' said Representative Joe Barton, Republican of Texas, who as chairman of the House energy subcommittee has been leaning on the Federal Energy Regulatory Commission to scrutinize the California gas market. ''Reasonable people could conclude people have gamed the system.'' In one significant case, California utility regulators and Southern California Edison, one of the state's struggling electric utilities, have accused the El Paso Corporation of using its control of a major pipeline into the state to inflate prices artificially. El Paso officials deny wrongdoing and accuse California officials of making the company a scapegoat for the state's failure to build more pipelines. A judge at the federal energy commission is hearing the case in Washington. But fingers are pointing in other directions, too. For example, the Southern California Gas Company, the state's largest gas utility, has reaped huge profits buying and selling gas in the last year -- activity encouraged by state regulations intended to lower gas prices for consumers. But some gas marketers and electricity generators contend that the trading has contributed to price spikes, by tying up valuable pipeline space during peak times with gas shipments driven by financial deals, not power demands. At the same time, Edison says that Southern California Gas failed to put enough gas into storage last fall for residential and small-business customers. If so, that would have driven the gas company back into the market in the winter, when demand from power plant operators was high, helping push gas -- and hence electricity -- prices yet higher, Edison complains. Between them, El Paso and Southern California Gas were responsible for $3.7 billion in excess prices for energy in the last year, Edison contends. Southern California Gas, a unit of Sempra Energy, denies that its trading has harmed the market. Rather, its executives note that electricity generators and industrial gas consumers -- which under state rules are responsible for managing their own gas supplies -- put very little gas into storage last year. By one estimate, large gas consumers in Southern California had only 11 percent as much gas in storage at the end of November as they did at the same time during the prior two years. Another problem may emerge this summer, according to William L. Massey, a member of the federal energy commission. Mr. Massey said new commission rules intended to limit electricity price spikes in California will almost certainly prompt energy-trading companies -- which deal in both gas and electricity -- to manipulate gas prices. That is because the rules allow electricity generators to charge more if gas prices move higher. Similarly, growing attention is being paid to the role played by financial trading tied to the price of electricity and natural gas. Industry critics question whether huge trading volumes in these financial derivatives gives energy marketing companies the incentive to manipulate prices in tight markets. Federal regulators ''don't seem to understand that firms are really trying to make as much money as they can,'' said Severin Borenstein, director of the University of California Energy Institute, a research organization on the Berkeley campus. ''That's what they do for a living.'' Fixing the problem is simple, Mr. Borenstein said. ''If you build more capacity,'' he said, ''you reduce both the scarcity issue and you reduce the ability of people who currently own capacity to exercise market power.'' Regardless of whether companies are manipulating prices, the California natural gas market is fattening bottom lines. In the El Paso case, testimony has shown that pipeline capacity acquired by the company's marketing affiliate in March 2000 for $38.5 million produced profits of almost $900 million over the next 13 months. El Paso said its share of those profits was $184 million, the rest going to other companies with which it entered into hedging transactions intended to limit El Paso's exposure if gas prices fell. About half of those transactions were with the biggest energy trader, the Enron Corporation, according to people present at briefings El Paso officials have given to California officials. An Enron spokesman, Mark Palmer, said it was possible that Enron took the other side of the trades, but he said that Enron would have resold the pipeline capacity almost immediately, thus profiting little from the rise of gas prices in California. Federal regulators, concerned that the high gas prices in California may not be legitimate, have proposed requiring companies selling gas in the state to disclose extensive data about their transactions. They are also considering whether to reimpose price caps on short-term sales of pipeline capacity that were eliminated early last year. Further, regulators are scrutinizing the so-called gray market in which energy marketers bundle gas and transmission capacity and sell it to large customers, like electricity generators, for one price. Federal regulators have oversight responsibility for the interstate portion of gas shipments, but they have not looked closely at these bundled transactions, Mr. Massey said. ''The whole thing has fallen through the cracks,'' he said. Nearly all of California's gas comes from the Southwest, the Rocky Mountain states and Canada through a few huge, highly pressurized pipelines. In California, the gas is shunted onto intrastate pipelines that deliver it to consumers and to underground storage fields for later use. Those pipelines are now largely running full, and their capacity is about 300 million cubic feet a day less than what interstate pipelines can deliver. The difference is the amount of gas it takes to continuously fuel a 1,300 megawatt power plant -- enough to light more than a million homes. ''It's not resources, it's straws -- the straws needed to suck this gas where it needs to go,'' said Thom Kelly, assistant executive director of the California Energy Commission. ''If the straws are full, that's a problem.'' Operators of interstate pipelines have proposed new construction that could double delivery to the state. Indeed, odd as it seems now, some in the industry worry that California could be ''overpiped'' later this decade, just as it was in the mid-1990's. Likewise, Southern California Gas plans only limited expansion of its in-state pipelines, partly because it expects demand to fall as hydroelectric power supplies return to normal levels and older, less efficient gas-fired power plants are phased out. But the gas company's intentions are regarded with skepticism by others in the industry. Some executives contend that Southern California Gas has damaged the marketplace through its enthusiastic embrace of a state program that allows it to split with customers the profits from buying, selling and lending gas. A coalition of power generators, including Reliant Energy, the Williams Companies and the Los Angeles Department of Water and Power, has complained to state officials that the program ''creates perverse incentives'' for the gas company. The generators say it results in extra demand for pipeline space when capacity already is at a premium, making prices more volatile. The consequences of the gas company's low storage inventories were evident in early December, according to John Stout, a senior Reliant executive. He recalled listening in on a conference call as a Southern California Gas official talked about injecting gas into storage. ''I was floored,'' Mr. Stout said. ''Prices were sky high, and they were putting more upward pressure on prices.'' Lee M. Stewart, president of energy transportation services for Southern California Gas, called the criticism ''bogus.'' The utility's storage and trading practices have neither hurt the market nor curtailed gas sales to customers, he said. ''To say gas prices drive electricity prices is a falsehood,'' Mr. Stewart added. But to many regulators, it is clear that gas prices play an increasingly important role in electricity prices. Problems in the California natural gas markets ''haven't been given the prominence they deserve for the detrimental role they are playing in high electricity prices,'' said Linda K. Breathitt, another member of the federal energy commission. ''Natural gas prices have been the stepchild of this California crisis.'' This article is part of a joint reporting project with the PBS series ''Frontline,'' which will broadcast a documentary about California's energy crisis tonight. Photo: This Redondo Beach, Calif., power plant, owned by the AES Corporation, uses natural gas, as do almost half of the state's electric plants. About 85 percent of the gas consumed in California comes from outside the state. (Agence France-Presse)(pg. C12) Chart/Map: ''A Vital Network Under Pressure'' Though California is crisscrossed by natural gas pipelines, capacity is limited, magnifying the state's energy woes. Half of California's electricity is generated by gas-fired power plants, and the shortage of highly pressurized pipelines both into California and within the state has become a big handicap in fueling those plants. (Source: California Energy Commission)(pg. C12) Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Economy Price-Curb Plan: Is It California Dreaming? --- Regulators Again Tackle Power Market That Remains Chaotic By John R. Emshwiller Staff Reporter of The Wall Street Journal 06/05/2001 The Wall Street Journal A2 (Copyright © 2001, Dow Jones & Company, Inc.) Federal regulators have launched yet another attempt to control California's out-of-control wholesale electricity market. But like previous efforts, it could have limited effectiveness. Already, critics are predicting failure for the new "price mitigation" plan that the Federal Energy Regulatory Commission put into effect last week. The FERC's pricing plan is again "laced with loopholes," says California Gov. Gray Davis, who says that "it's worse than too little, too late." Backers say the new initiative is more comprehensive and less susceptible to manipulation by power suppliers than previous efforts. They note that some electricity prices fell last week following implementation of the order. A spokeswoman for the California Independent System Operator, which runs the state's transmission grid and has been critical of the new FERC plan, says it is too early for her organization to evaluate the initiative's impact. FERC's new plan attempts to control prices during periods of relatively tight supply. In contrast to previous controls that had specific dollar targets, the new plan uses a fluctuating market price derived from production costs at California plants. Prices above this benchmark will be subject to FERC review and possible refunds by suppliers. The price-control efforts have been prompted by a botched 1996 California utility-deregulation plan that contributed to leaving the state with extremely tight power supplies. In May 2000, wholesale electricity prices began soaring. Power that previously fetched $20 to $40 a megawatt hour began trading for hundreds of dollars. Officials first tried price caps. For example, caps ranging from $750 down to $250 a megawatt hour have been in place at various times on the power that the ISO buys, at the last minute, to avoid shortages. During several hundred hours last summer, it appeared that the caps restrained some electricity prices from going higher, according to a recent study by the California State Auditor. The market became progressively tougher to control, though. Under the state's deregulation design, the vast majority of the power needs was to be purchased a day ahead of time. As the crisis worsened last year, suppliers and buyers began to see economic advantages from doing more transactions in the ISO real-time, last-minute market. Eventually, more than a quarter of the system's electricity needs were, at times, obtained through the ISO market, far more than ever anticipated. Having so many last-minute purchases endangered the reliability of the transmission system. To discourage transactions in the last-minute market, officials began ratcheting down the price cap there, lowering it to $250 in August. But suppliers apparently found ways to avoid the tighter cap. One such method is known as "megawatt laundering." Since the caps didn't apply to power coming from out-of-state suppliers, California generators had an incentive to sell power to a purchaser in another state, who could then quickly sell back the juice through the ISO at whatever the market would bear. After the ISO price cap went down to $250, so-called out-of-market transactions, which include out-of-state power purchases, soared to an average of 5,000 megawatts an hour by early December from almost nothing. At the same time, sales through the ISO's real-time market fell to a trickle. Prices of the out-of-market transactions in December averaged $461 a megawatt hour, nearly twice the price cap. Part of this surge might be explained by a sharp rise in the cost of natural gas, a major power-plant fuel. As rising fuel costs pushed up generating costs, producers had an added incentive for avoiding the California price caps, say some observers. Several state and federal investigations are looking for evidence of illegal manipulation in the skyrocketing prices for natural gas and electricity. Much electricity is sent out of state under perfectly proper, long-term arrangements. Even "megawatt laundering," though a pejorative phrase, isn't necessarily illegal unless it is part of a concerted effort to drive up market prices, say state and federal officials. Spurred by the rapid rise in out-of-market transactions, ISO officials abandoned the price cap in December. FERC then approved a "soft cap" price-control plan. Sales made at more than $150 a megawatt hour were subject to FERC review and possible refund orders if the price was found to be too far above the supplier's costs. So far, FERC has tentatively ordered over $100 million in refunds. Critics of that FERC soft cap say it was too generous in its calculations of production costs and far too limited in its scope. The cap only kicked in during a Stage 3 alert, when supplies were so tight that rolling blackouts were imminent. Some state officials and others argue that the FERC should be ordering billions of dollars in refunds for prices charged over the past year. The price-control feature of the new FERC plan covers more hours than the previous one but will still be restricted to times of relatively tight supply. Critics say controls should be in effect during all hours, since prices have often been high around the clock. Plus, the new plan still fails "to take any constructive steps to eliminate or even to minimize the pernicious effects of `megawatt laundering,'" says a recent ISO filing with the FERC. Out-of-state sales still aren't covered by the latest plan, which leaves suppliers with a large potential loophole for reaping higher power prices. The volume of out-of-market transactions has remained high this year. In April, the price for such deals averaged $372 a megawatt hour. Gov. Davis and others argue that price controls need to be extended throughout the Western U.S. In its decision unveiling the new control plan, FERC acknowledged that more may be needed on the laundering issue. It opened an investigation into sales transactions around the West. The terms of such sales, said the FERC decision, might not be "just and reasonable." --- Another Try Main points of FERC price-mitigation plan: -- Creates a price benchmark, based on production costs, to be used in periods of tight electricity supplies. Sales at prices above benchmark are subject to possible refunds. -- Requires all generators in California to offer all available capacity around the clock to the state's transmission-system operator. -- Requires weekly reports from state officials to FERC regarding bid data and plant outages. -- Initiates investigation into electricity trading in other Western states. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Calendar; Entertainment Desk TUNED IN 'Blackout' Tries to Shed Light on Crisis STEVEN LINAN TIMES STAFF WRITER 06/05/2001 Los Angeles Times Home Edition F-10 Copyright 2001 / The Times Mirror Company With each passing day, there's seemingly a new surge in California's energy crisis. "Frontline" addresses that hot-button issue tonight in an hour aptly titled "Blackout" (9 p.m. KCET, 10 p.m. KVCR). Through interviews with state and federal officials, utility executives and industry insiders, the documentary examines whether power companies and energy-trading giants have capitalized on deregulation to accrue enormous profits as consumers and business owners suffer power shortages and rising rate hikes. Jeff Skilling, CEO of the Enron Corp., the largest energy trader in the world, sees his company as one of the "good guys." "We are working to create open, competitive, fair markets," he tells reporter Lowell Bergman, who wryly notes that if true, lately the good guys have been winning since the past year has seen a large transfer of wealth from energy consumers to power sellers and traders like Enron. After raising the topics of deregulation and the bankruptcy of Pacific Gas & Electric, Bergman interviews S. Davis Freeman, the former Los Angeles Department of Water and Power chief, Gov. Gray Davis and Vice President Dick Cheney. There are no easy answers in this complex issue, with one side pointing fingers at the other, but one thing is certain: A long, hot summer is likely to yield more rolling blackouts for California consumers, while other states wait to see if they will be adversely affected as well. PHOTO: The "Frontline" documentary "Blackout" addresses California's energy crisis.; ; PHOTOGRAPHER: Associated Press Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. June 5, 2001, 1:16AM Houston Chronicle Energy Alley to blame for California's woes? Frontline joins in Texas bashing on energy By ANN HODGES Copyright 2001 Houston Chronicle TV Critic Frontline joins hands with the New York Times tonight, to jump into what California Gov. Gray Davis has turned into a marathon news blast at Texas, and at Houston, over his state's energy woes. Frontline: Blackout, airing at 10 tonight, should have Davis and his bash-Texas troops giving each other high fives. In its opening minutes, Frontline's narration sets a tone for Texas-bashing: "Investigators (otherwise unidentified) claim that a handful of energy companies siphoned billions from consumers while the lights (in California) were out. "If you want to understand the story of electric power in America today, you have to follow the electrons and follow the money. It's a story that starts here, in Houston, Texas." The blame game is in high gear, as Frontline's dust-up hovers over Houston. Houston's Energy Alley, home of "electric cowboys" (Frontline's words), is the focus of this "follow-the-money" trail. And Ken Lay, chairman of Enron, "the 800-pound gorilla" in the Alley, gets the major grilling in its high-powered interview hot seat, along with Enron CEO Jeff Skilling. Interviewees also include Vice President Dick Cheney, California and federal officials, other company executives, industry insiders and what Frontline calls "whistle-blowers." Politics and finger-pointing fuel charges and countercharges, with Frontline correspondent and New York Times contributor Lowell Bergman conducting the interviews, and an off-camera narration spinning the sound and fury. With blackouts expected to hit New York this summer, "the entire country will soon be short on power," Frontline asserts to set the stage. "The generators have made more money than God. I mean, they've made 7, 8, 900 percent profit," Davis charges. "Now that a fellow Texan sits in the White House," Frontline says, "the companies on Energy Alley are hoping things will only get better. ... Lay is a personal friend and big backer of President Bush, and he and his executives have been the Bush family's most generous contributors. ... " "There are a few of us that are still maybe idealistic enough to think that we can kind of support a candidate because we really believe in the individual," Lay counters. "We believe in their policies. We believe in the direction they are going to take the country." El Paso Corp., the largest natural gas company, gets its lumps, too, from California officials. The Federal Energy Regulatory Commission (FERC) was ready to dismiss California's complaint of price manipulation at the state's borders, Frontline says, "until Frontline and the New York Times obtained sealed documents revealing discussions at El Paso's highest levels." "Those documents are irrelevant," El Paso spokeswoman Peggy Heeg says. Frontline passes its golden opportunity to lay out, clearly and concisely, both sides -- what critics say are the self-inflicted origins of California's energy crisis, and California's charges of price-gouging and pleas for price caps. Instead, that information comes piecemeal, over the course of contentious and often-confusing exchanges. To avoid retreat on deregulation, now in progress in 24 states, companies have begun to raise the possibility of settlement with California, Frontline reports. In Lay's opinion, "It's still going to take a comprehensive settlement of the whole issue, all the issues" -- including money. Give Frontline full credit for stepping in where no other TV news outlet has dared to tread in such depth. Something is surely better than nothing. But this Frontline/New York Times team coverage effort does not cool the blame game. It sheds more heat than light. Frontline: Blackout, 10 tonight, 9 p.m. June 12 on Channel 8. Grade: B. June 5, 2001, 1:17AM Houston Chronicle PBS pledge drive alters schedule By MIKE McDANIEL Copyright 2001 Houston Chronicle TV Editor Paul Hope, like many theater fans, tuned to Channel 8 Sunday night in anticipation of the first hour of the joint PBS/CBS telecast of the 55th Annual Tony Awards. What he got instead was a travelog hosted by Rudy Maxa. Because this is pledge drive week, Channel 8 did not air the first hour of the three-hour award show, as it has in previous years. "Channel 8 has made Houston a theatrical cowtown by this decision," Hope, a resident actor at the Alley, said Monday. Alley artistic director Gregory Boyd called the preempting "absolutely indefensible and shocking." Fortunately, Channel 8 is being more flexible about a second program that it had originally decided not to air this week. Frontline, which airs nationally at 9 p.m. tonight, takes a hard look at California's energy problems and their direct connection to Houston. The telecast includes interviews with several Houston players, including Enron's Kenneth Lay. KUHT station manager John Hesse said Channel 8 became aware of the Frontline story, titled Blackout, and its Houston connection last week. Because of its local news value, the show will be tape-delayed and aired on KUHT at 10 tonight. It will be repeated at 9 p.m. June 12, when Channel 8 originally had planned to air the show. "When we learned of the local significance, we obviously wanted that program to air (here) in a timely manner as in the rest of the country," Hesse said. "We are getting a little bit of heat for the Tony thing," Hesse said. "The problem is, it's right in the beginning of our pledge evening. We had a schedule in place, and a decision was made to stick to that schedule because that was our opportunity for fund raising." Fund drives are vital to keep the station operating and to purchase quality programming. "When we're scheduling our pledge dates, we try to coordinate the normal PBS schedule with what we determine will do the best for us in terms of fund raising," Hesse said. "We only use about 2 percent of our air time a year in fund-raising efforts, and when we're using that 2 percent, we have to make the most of them." That's no comfort to the folks who were hoping to experience what turned out to be theatrical history being made. Mel Brooks' The Producers -- not only the talk of Broadway but also the entertainment world -- won a record 12 Tonys Sunday night. Most were awarded in the show's first hour -- where Tonys for director, choreographer and other categories are handed out. To diehards, the PBS portion of the Tonys exceeds CBS' in that it airs without commercials and includes behind-the-scenes interviews with directors, composers, designers and others. Hesse explained that Channel 8's pledge-drive dates were set before the station knew whether PBS would even have the Tonys. The first hour of Sunday's show had direct links to theater talents whose work has been seen and heralded in Houston. David Woolard, nominated for best costume design for The Rocky Horror Show, is costume designer of The Carpetbagger's Children, which opens Wednesday at the Alley. Doug Besterman, a winner Sunday for his orchestrations for The Producers, has done the same for the Frank (Jekyll and Hyde) Wildhorn productions that have played here. Doug Schmidt, a nominee in the scenic design category for 42nd Street, was a designer for the Alley's Civil War and A Christmas Carol. Hesse said, "We knew by the end of March" that PBS would co-host Sunday's show, and yet "the decision was made to stick with the schedule in place." Because the Tonys isn't "owned" by PBS, it could not be used as a pledge show, although Hesse conceded pledges could have been sought before and after. "There's nothing against the `rules,' " he said. "It's just been our normal method of operation here (to run the pledge drive at 7 p.m.) in terms of our prime-time evening pledge start." In a related development, NBC affiliate KPRC will not be showing the first episode of a new comedy series bowing tonight. Kristin, starring Kristin Chenoweth, is being pre-empted by Road to Redemption, a movie funded by the Billy Graham Crusade. Channel 2 made a decision in March to run the movie 7-8:30 tonight, KPRC general manager Steve Wasserman said. NBC has scheduled the premiere of Kristin for 7:30 p.m. and is not allowing it to air later in prime time, he said. PBS Shines Light on Energy Crisis By LYNN ELBER AP Television Writer 06/05/2001 AP Online Copyright 2001 The Associated Press. All Rights Reserved. LOS ANGELES (AP) - As California's energy crisis casts a widening shadow, PBS' "Frontline" helps illuminate the issue with a high-wattage documentary. "Blackout" is both a comprehensive report and a warning: California's power deregulation woes represent a national problem not destined for a quick or painless solution. The hourlong film, with reporting by "Frontline" correspondent Lowell Bergman done in conjunction with The New York Times, airs 10 p.m. EDT Tuesday on PBS stations (check local listings). If you're a consumer frustrated by price hikes or concerned about what might happen in your state, "Blackout" should be considered required viewing. Major players, ranging from power company chiefs to consumer advocates to Vice President Dick Cheney, make their case on energy policy. Gov. Gray Davis and others grappling with California's flawed new system, which has inspired many states to put their own deregulation efforts on hold, are interviewed. "Blackout" also touches on alleged machinations involving the Federal Energy Regulatory Commission that could affect how much, if at all, the federal government will weigh in on power prices, and renews questions about corporate influence on the Bush administration. What ultimately emerges is a classic debate, framed in 2001 political realities, over whether an unfettered market is invariably the best approach or whether capitalism sometimes must bend to regulation. Bergman is adamant about the importance of understanding a power industry that has undergone massive change. "We've launched ourselves into a great economic and social experiment in the free market with a commodity that 65 years ago the country decided to put under heavy regulation because it was so vital," he said in an interview. "We've gone into this experiment without having a full national debate about what the consequences could be," Bergman said. "It may all work out, but it's clear that we're at least in a transition period where a lot of people are going to pay the price." In New York, for instance, blackouts are a possibility this summer and rate hikes of up to 40 percent a likelihood, Bergman said. There are those striking it rich in this bold new world. "Blackout" opens on Houston's "energy alley," home to new-breed power companies including what the documentary calls the 800-pound gorilla, Enron Corp. Enron, which has drawn attention because of chairman Kenneth Lay's close ties to President Bush, generates profits by serving as middleman between electricity makers and consumers. The world's largest energy trader, Enron sees from $2.5 billion to $3 billion in purchases and sales a day, according to its chief executive officer, Jeff Skilling. "We are doing the right thing," Skilling tells "Blackout." "We are working to create open, competitive, fair markets. ... We are the good guys. We are on the side of angels." If that's true, Bergman says in the film, the good guys have been winning: The past year saw a "vast transfer" of wealth from energy consumers to power sellers and traders like Enron. They are taking advantage of the end of an era: the federal regulatory system implemented by President Franklin D. Roosevelt in the 1930s to limit abuses by utility monopolies. In the 1980s, "Blackout" tells us, free-market proponents began pushing for an end to regulation. In 1992, a federal law was passed that allowed for states to deregulate electricity. There was broad but not unanimous support for such change. "It's OK for the price of fur coats to go up and down. ... It's not OK for the oxygen of life in this high-energy civilization," David Freeman, the former Los Angeles Department of Water and Power head and now state energy czar, tells "Blackout." Mark Cooper, director of research at the Consumer Federation of America, who notes there have already been price spikes in electricity in the Midwest and New England, says the outcome speaks for itself. "How do we go from $40 a megawatt for capacity in a regulated system to $1,000 in a deregulated system, and you're telling me I'm better off?" Cooper asks in the documentary. Enron's Lay weighs in on the other side. "I've yet to see any system in the world ... that over time does a better job of setting prices and allocating supplies than a competitive market," Lay says in "Blackout." He has a key philosophical ally in the Bush administration, which says increased supply and not federal intervention is the logical answer. "We're doing everything we can to help California on a short-term basis," Cheney says. "There's not a lot you can do. You can't manufacture kilowatts in the West Wing of the White House." Bergman, the former "60 Minutes" producer who was portrayed in the movie "The Insider," believes there is one certainty about the power crisis: The media generally has given it short shrift. "Unfortunately this story has been covered, particularly on television, in much the same way a car crash is covered. You never learn whether the car was safe or the highway was safe. You just see the blood and guts." "Nobody's spent the air time to explain to people how this all happened and why this may be coming to a neighborhood near you." --- On the Net: http://www.pbs.org/frontline Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Senate to subpoena documents from power generators 06/05/2001 Associated Press Newswires Copyright 2001. The Associated Press. All Rights Reserved. SACRAMENTO, Calif. (AP) - The state Senate Rules Committee has agreed to issue subpoenas to eight out-of-state electricity generators, including two from Texas, demanding documents on bidding, pricing and other aspects of power sales in California. The subpoenas would help a special Senate committee's investigation into whether the companies are illegally profiteering from California's power crisis. The committee's chairman, Sen. Joe Dunn, D-Santa Ana, said he expects the companies to resist, setting the stage for a court battle. Though energy executives seemed cooperative when the investigation was launched two months ago, they have since demanded that confidentiality protection for their documents, Dunn said. Energy executives deny that they've broken any laws selling electricity to California at record-high prices. Dunn's committee is looking within the state for answers as well. The Los Angeles Department of Water and Power could find its records subpoenaed if it doesn't provide information on its power sales. The manager of the state's power grid reported the DWP had made large profits by selling power to the rest of the state. The committee may even subpoena records from the state Department of Water Resources unless it turns over information on how it has spent more than $7 billion to keep the state's lights on. The Legislature also needs information on the electricity the state DWP buys from wholesalers for the customers of the state's three largest investor-owned utilities, and the bidding strategies used to the make the bids, said Sen. Ross Johnson, R-Irvine, vice chairman of the rules panel. Davis has refused to release details of the deals, warning 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. The subpoenas will be issued to Reliant Energy of Houston, which Gov. Gray Davis has publicly accused of price gouging, Dynegy Energy Services Inc., Williams Energy, Houston-based Enron Corp., NRG Energy Inc., Duke Energy, Mirant Inc., and AES Corp. Dunn's panel needed approval of the rules committee to issue the subpoenas under Senate regulations. The committee won't issue the subpoenas for at least one-week, after the chairman of the Rules Committee, Senate President Pro Tem John Burton, D-San Francisco, opposed issuing subpoenas to the city and state departments, at least temporarily. --- On the Net: http://www.sen.ca.gov Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. California; Metro Desk Panel OKs Subpoenas for Energy Companies Electricity: Special state Senate committee will demand pricing information in inquiry into whether California has been gouged. CARL INGRAM; MIGUEL BUSTILLO TIMES STAFF WRITERS 06/05/2001 Los Angeles Times Home Edition B-1 Copyright 2001 / The Times Mirror Company SACRAMENTO -- 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." Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Enron's Indian Creditors Seek to Save Dabhol Project (Update1) 2001-06-05 02:40 (New York) Enron's Indian Creditors Seek to Save Dabhol Project (Update1) (Adds importance of Dabhol Power for future investment in India, in third paragraph.) Singapore, June 5 (Bloomberg) -- Industrial Development Bank of India and other Indian banks that helped fund Enron Corp.'s first investment in the nation are meeting in Singapore to try to persuade international lenders to keep the $3 billion power project alive. International banks such as ABN Amro Holding NV, Citibank NA, a unit of Citigroup Inc., Bank of America and Credit Suisse First Boston in April approved a decision by Enron unit Dabhol Power to terminate its supply agreement with Maharashtra State Electricity Board in a row over electricity prices. Unlike the Indian banks, foreign lenders received government guarantees for about $600 million they lent to the project, which is seen as a litmus test for future foreign investment in Indian infrastructure projects. The Indian banks fear the foreign creditors will cancel the project and invoke their guarantees. ``We will discuss how we can go about resolving the problem,'' said R.S. Agarwal, an executive director at Industrial Development Bank of India, or IDBI, the biggest lender to the Dabhol project. The outcome of the two-day meeting, being held in the offices of ABN Amro Holding NV, one of the biggest international lenders to the project, will be crucial to the Indian banks, which have lent as much as $2 billion to Dabhol. IDBI has exposure of 21.58 billion rupees ($460 million) to the project, including 15.28 billion rupees in guarantees. Dabhol, 65 percent owned by Enron, and the Maharashtra State Electricity Board are in dispute over 3 billion rupees in unpaid bills for December and January. Others bills through March have been paid. The board has refused to pay the December and January bills saying they should be lowered to reflect a 4 billion rupee penal the board imposed on Dabhol for not supplying power at full capacity on Jan. 28. India's government risks having to pay 170 billion rupees in fines, resulting from guarantees it has offered on payments and loans, if Enron pulls out of the project. The dispute Thursday prompted debt-rating company Fitch to change its outlook on India to ``negative'' from ``stable.'' Fitch said the climate for foreign investors has deteriorated. ASIA-PACIFIC: Enron 'frustrated' by talks Financial Times; Jun 5, 2001 By JULIE EARLE and KHOZEM MERCHANT Enron, the US energy group, says it is becoming "increasingly frustrated" with its negotiations with the Maharashtra state government agencies in India. The US energy group denied reports that it was renegotiating the contract and the tariff between its Indian arm, the Dabhol Power Company, and its sole customer, Maharashtra State Electricity Board (MSEB). "That is not true," said an Enron spokesman at the weekend. "Why would we renegotiate with counter parties? They are trying to imply a contract that was in place for eight years and operating for two years does not exist." The denial came as Indian and foreign banks prepared to try to bridge their differences over sustaining support for Dabhol's Dollars 2.9bn power project near Bombay, which has been supplying the Maharashtra utility. A two-day meeting in Singapore starting today will aim to stake out common ground, which lenders hope will remove the uncertainty dogging the controversial 2,184MW power project. The Indian utility owes Dabhol Dollars 45m (Pounds 32m) but is demanding in turn a greater sum in rebates for what it describes as the US company's failure to meet technical thresholds. Lenders have stopped disbursing loans to the 1,444MW second phase of the project, which is due for completion soon. The 740MW first phase was commissioned in May 1999. ABN Amro and Bank of America are two of the banks that will thrash out the issues with State Bank of India, Industrial Development Bank of India and ICICI. People close to the talks say the situation has "worsened" since the last lenders' meeting in April, when Dabhol received authorisation to quit the project. Dabhol has since issued a pre-termination notice, signalling its intent to withdraw in six months if a solution is not found. MSEB has responded to the threat by abandoning its power purchase contract with the company. Copyright: The Financial Times Limited New Securities Issues 06/05/2001 The Wall Street Journal C17 (Copyright © 2001, Dow Jones & Company, Inc.) The following were among yesterday's offerings and pricings in U.S. and non-U.S. capital markets, with terms and syndicate manager, based on information provided by Dow Jones Newswires. (A basis point is one-hundredth of a percentage point; 100 basis points equals a percentage point.) CORPORATE Freddie Mac -- $300 million of notes was priced via lead managers HSBC Securities Inc., Bear, Stearns & Co. and Goldman, Sachs & Co., according to MCM CorporateWatch. Terms: amount: $300 million; maturity: Dec. 12, 2003; coupon: 5%; issue price: par; yield: 5%; settlement: June 12, 2001 (flat); call date: noncallable for six months. Freddie Mac -- auctioned $3 billion of one-month reference bills, as well as $4 billion of two-month reference bills. Terms: One-month(28): settlement: 06/05/2001; maturity: 07/03/2001; Cusip: 313397HR5; price: 99.695111111; MM yield: 3.932. Two-month(56): settlement: 06/05/2001; maturity: 07/31/2001; Cusip: 313397JU4; price: 99.408888889; MM yield: 3.823. GLOBAL Monumental Global Funding Ltd. -- $100 million floating-fate notes at three-month Libor plus 38 basis points due Jun. 15, 2011 at 100.325 was priced via Westdeusche Landesbank. Tesco PLC -- GBP 150 million of 6% Eurobonds due Jun. 13, 2008 at 99.894, was priced via Morgan Stanley Dean Witter. Spread 68 basis points above 9% 2008 gilt. Fees 0.325 point. General Motors Acceptance Corp. -- GBP 200 million of 6.375% Eurobonds due Dec. 7, 2007 at 99.689 was priced via Dresdner Kleinwort Wasserstein and UBS Warburg. Spread: 61 basis points above mid-swaps, 110 basis points above 7.25% gilt due December 2007. Fees 0.35 point. Enron Corp -- offering a two-tranche floating rate and fixed-rated note totaling 50 billion yen. Tranche one: 40 billion yen at three-month London interbank offered rate plus 62 basis points due June 18, 2003 at par, via Merrill Lynch. Fees 0.35 point. Tranche two: 10 billion yen of 0.77 fixed-rate notes due June 18, 2003 at par, via Merrill Lynch. Fees 0.35 point. The Republic of the Philippines -- increases GBP 150 million floating-rate Eurobond at three-month dollar Libor plus 305 basis points due June 18, 2004 at par to total $200 million, via Credit Suisse First Boston. Fees 0.27 point. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. India Lenders Mtg Seeks To Salvage Enron Dabhol Pwr Proj By Himendra Kumar Of DOW JONES NEWSWIRES 06/05/2001 Dow Jones Energy Service (Copyright © 2001, Dow Jones & Company, Inc.) NEW DELHI -(Dow Jones)- Indian institutions that have lent money to Enron Corp.'s (ENE) controversial Dabhol Power Co. are expected to make a collective bid to salvage the beleaguered power project during a two-day meeting this week in Singapore. Domestic lenders, which include the Industrial Development Bank of India, the State Bank of India (P.SBI) and ICICI Ltd. (IC), have the highest exposure to the DPC's US$2.9 billion project and are anxious not to see it collapse. The Dabhol Power project represents India's biggest foreign investment deal in India to date. "We want the project to run," IDBI General Manager R.M. Ganatra told Dow Jones Newswires ahead of the meeting. "The Indian lenders will make a common cause at the lenders' meeting to prevent Enron from pulling out. The Indians have lent US$1.4 billion out of the project's total projected cost of US$2.9 billion. As IDBI's own exposure is in the excess of 20 billion rupees (US$1=INR47.01), the bank runs the risk of going deep into the red if this project goes bust," he said. Indian lenders have mutually decided to block further loans to Dabhol's second phase until an agreement was reached, Ganatra added. Dispute Has Unnerved Foreign Lenders The Dabhol Power project, situated in the western state of Maharashtra, will generate 2,184 megawatts of electricity when the second phase is scheduled to be completed later this year. Texas-based Enron has a 65% stake in DPC and is the project's largest shareholder. Other shareholders include the Maharashtra State Electricity Board, or MSEB, with 15%, General Electric Co. (GE) and Bechtel (X.BTL) with 10% each. Enron is at the center of a power supply dispute between the state government and Dabhol Power over what the government claims are "unaffordable" power tariffs. The dispute has unnerved foreign lenders. Domestic lenders at this week's meeting in Singapore are expected to try and calm frayed nerves. Ganatra, together with other domestic lenders, feel the dispute between DPC and its sole buyer MSEB is still resolvable despite DPC's issue of a preliminary termination notice in April. He said the fundamental issue in the dispute was the cost of power and added, "There was need for an agreement on a reasonable tariff." Dabhol has come under fire because of the relatively high cost of its power. Critics object to Dabhol charging INR7.1 a kilowatt-hour for its power, compared with INR1.5/kwh charged by other suppliers. Domestic lenders want the federal government to clear MSEB's defaults of US$48 million and also find additional buyers for DPC's electricity, possibly the state-owned power utility like National Thermal Power Corp. Ltd. (P.NTP), from the second phase of the Dabhol project. Ganatra also urged the federal government to take a more active role in conflict resolution. "The government should not shirk its responsibility and it should set a time limit for the MSEB and DPC to sort out their dispute with the lenders' interests in mind," he said. -By Himendra Kumar, Dow Jones Newswires; 91-11-461-9427; himendra.kumar@dowjones.com Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Developments in California's energy crisis 06/05/2001 Associated Press Newswires Copyright 2001. The Associated Press. All Rights Reserved. Developments in California's energy crisis: TUESDAY: - A leading advocacy group for the poor tells state leaders to use the economic power of the state's huge pension funds to leverage power companies. The Pacific Institute for Community Organization says the two pension funds own at least $1.2 billion in stocks and bonds in most of the firms that sell electricity to California. MONDAY: - A special Senate committee investigating whether out-of-state power companies are illegally profiteering the state's power crisis gets permission from the Senate Rules Committee to subpoena documents from the companies detailing bidding, pricing and other aspects of their electricity sales to the state. The committee plans to subpoena Mirant, Dynegy, Williams, AES, Duke, Enron, NRG and Reliant, and could also issue subpoenas to the Los Angeles Department of Water and Power and the state Department of Water Resources to access details of their power selling and buying processes, respectively. - The state's grid operator says California's electricity production should improve in the coming weeks as more power plants come back on line after spring maintenance shutdowns. That, coupled with conservation efforts, could help during this summer's high temperatures, independent observers say - but not enough to stave off blackouts. - The state's expanded Low Income Home Energy Assistance Program (LIHEAP) program begins with $120 million in state money. It is aimed at helping working poor households, senior citizens, disabled persons, migrant seasonal farm workers, limited-English-speaking persons and households with very young children whose incomes fall at or below 250 percent of the federal poverty level. That includes households with four members having an annual gross income of $44,125 or less; three-member households earning $36,575 or less; two-member families earning $29,025 or less; and individuals earning under $21,475. Further information is available at www.csd.ca.gov or at 1-800-433-4327 (HEAP). - Ten schools in three Southern California districts cut their electricity waste up to 18 percent through the Alliance to Save Energy's Green Schools Program. Together, the schools saved more than $51,000 over about eight months by changing their usage habits, according to Southern California Edison, which sponsored the program. More information is available at www.ase.org/greenschools. - Critics tell the San Jose Mercury News that the federal agency overseeing California's electricity market needs to add resources and become more aggressive in watching for energy price gouging, issuing subpoenas for company documents if necessary. The Federal Energy Regulatory Commission has been accused of backing off investigations after energy generators have resisted, prompting some FERC officials to say their own system is flawed. - The FERC issues a statement saying it won't act on a request from small power generators to block a March 27 decision from the state Public Utilities Commission that has lowered the price they can charge for electricity. FERC says it won't step in because the matter is still pending at the PUC. - No power alerts Monday as electricity reserves stay above 7 percent. - Shares of Edison International closed at $10.58, down 42 cents. PG&E Corp. closed at $11.40, down 25 cents. Sempra Energy, the parent company of San Diego Gas & Electric, closes at $27.34, up 20 cents. WHAT'S NEXT: - Davis' representatives continue negotiating with Sempra, the parent company of San Diego Gas and Electric Co., to buy the utility's transmission lines. -In federal bankruptcy court Tuesday, Pacific Gas and Electric will ask U.S. Bankruptcy Judge Dennis Montali to stop the manager of the state's power grid from buying electricity for utility or charging it for any electricity bought after the utility filed for bankruptcy on April 6. THE PROBLEM: High demand, high wholesale energy costs, transmission glitches and a tight supply worsened by scarce hydroelectric power in the Northwest and maintenance at aging California power plants are all factors in California's electricity crisis. Edison and PG&E say they've lost nearly $14 billion since June to high wholesale prices the state's electricity deregulation law bars them from passing on to consumers. PG&E, saying it hasn't received the help it needs from regulators or state lawmakers, filed for federal bankruptcy protection April 6. Electricity and natural gas suppliers, scared off by the two companies' poor credit ratings, are refusing to sell to them, leading the state in January to start buying power for the utilities' nearly 9 million residential and business customers. The state is also buying power for a third investor-owned utility, San Diego Gas & Electric, which is in better financial shape than much larger Edison and PG&E but also struggling with high wholesale power costs. The Public Utilities Commission has approved average rate increases of 37 percent for the heaviest residential customers and 38 percent for commercial customers, and hikes of up to 49 percent for industrial customers and 15 percent or 20 percent for agricultural customers to help finance the state's multibillion-dollar power buys. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. June 5, 2001 Houston Chronicle Marathon joins Saudi gas venture Company replacing Enron in partnership By TOM FOWLER Copyright 2001 Houston Chronicle Houston-based USX-Marathon Group has taken over Enron Corp.'s abandoned stake in a $25 billion natural-gas venture in Saudi Arabia. Marathon, the fourth-biggest U.S. oil company, will join project leader Exxon Mobil Corp. and Occidental Petroleum Corp. in the "Red Sea Consortium," one of three exploration and development projects under the larger venture. Enron originally was named part of the deal, but on Friday the company pulled out without explanation, giving up its 20 percent stake in a portion of the project that initial estimates value at around $5 billion. Marathon was one of more than a dozen companies that bid on the project initially and one of several that did not make the final cut announced two weeks ago. Marathon, which has a long-standing relationship with the Saudis as a crude oil customer, had officials in Saudi Arabia for Sunday's signing ceremony, along with Exxon, Occidental, the Royal Dutch/Shell Group, BP, TotalFinaElf Houston-based Conoco and Phillips Petroleum Co. The projects are the first gas-exploration business Saudi Arabia has offered to international companies in 20 years. The country wants to convert its oil-powered utilities to run on cheaper natural gas, but needs international investments because of two decades of budget deficits. The gas business may not offer the companies the best profit margins compared with other projects, but it may give them a lead over rivals if Saudi Arabia lets international companies develop crude-oil reserves. The companies are expected to spend $17 billion on the biggest project and about $4 billion on another. The size of the Red Sea project still is unclear, Marathon spokesman Roger Holliday said. "My understanding is there's exploration involved, and the final scope of the project will be determined later," he said. Saudi officials liked some of the creative proposals Marathon included in its initial failed bid for the work, Holliday said, and indicated previously that there could be some potential work for the company. Enron's departure from the deal last week surprised many analysts, but is somewhat consistent with the company's decreasing emphasis on infrastructure projects. Enron withdrew from a $3.5 billion pipeline project to export natural gas from Qatar last month, while other international projects have proved to be difficult. A power-generation project in India has run into trouble because of disagreements between Enron and the Indian government over electricity prices, and Enron officials said Friday that a $130 million power plant project in Ontario may be in jeopardy because of the provincial government's foot-dragging over electricity deregulation. "I'm dumbfounded that they would pull out of a major project announced only two weeks ago," Goldman, Sachs & Co. analyst David Fleischer told Bloomberg News. "On the other hand, they're more of a services company than an energy company these days." Enron appears to be focusing on its rapidly growing commodity trading business, which includes trading natural gas, electricity, broadband Internet capacity and even such items as broadcast advertising time. India: Verbatim 06/05/2001 Business Line (The Hindu) Copyright (C) 2001 Kasturi & Sons Ltd (KSL); Source: World Reporter (TM) - Asia Intelligence Wire "I do not see any conspiracy from here." Prime Minister A.B.Vajpayee, when asked by mediapersons to comment on the "conspiracy theory" doing the rounds on the royal bloodbath in Nepal. "I have never met Bill Gates, and I'm not likely ever to do so. So at the risk of sounding too predictable, I would have to start by recommending the works of William Shakespeare. .. He invented himself so brilliantly that he invents all the rest of us." Literary critic Harold Bloom, when asked by the Harvard Business Review, what kind of literature he would recommend to Bill Gates. "In January they declared that anyone converting to Christianity would be executed. In March, the Taliban proudly set about the destruction of two enormous Buddhas... Now Hindus in Afghanistan will have to wear a badge or label to distinguish them from Muslims. Soon there will be no more religions for the Taliban to insult." An editorial in The Economist, saying "it's high time their Islamic friends reined in the Taliban." "One should not be euphoric... The summit meeting will hopefully generate a dialogue process." Pakistan's High Commissioner to India Ashraf Jehangir Kazi, on the proposed Indo-Pak summit in New Delhi, addressed the Indian Women's Press Corps. "It will be in the interest of Maharashtra if the company is asked to leave India." Narmada Bachao Andolan leader Medha Patkar, demanding that Enron's Dhabol Power company should be asked to "pack off from India" without any compensation, addressing a press conference in Pune. "We are down but not out. The DMK will rise again to face the next electoral battle. We require five years to nurse the wounds suffered by us in this election." DMK president M.Karunanidhi, addressing a public meeting organised by his party in Chennai to celebrate his 78th birthday. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. M and A Domtar buys G-P mills for $1.65B by Soma Biswas 06/05/2001 The Daily Deal Copyright © 2001 The Deal LLC Georgia-Pacific Corp.'s acquisition of the four pulp and paper mills transforms the company into the second-largest producer of uncoated freesheet in North America. http://www.domtar.com/domtar/english/newsrel.htm on Monday announced a final deal to buy four pulp-and-paper mills from Georgia-Pacific Corp. for $1.65 billion. For Montreal-based Domtar, the acquisition transforms the company from the seventh-largest producer of uncoated freesheet (used as printing and cop
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