Possible Hearing Themes

I have always found it useful in preparing for congressional hearings to have
"Hearing Themes." The themes represent both the points we want to make in
our written testimony and the points we should try to emphasize in our oral
answers to Member questions. Please feel free to edit. Here is a first
cut:

I. The energy problems in California are of its own making and ultimately
will require action by the State government. The State did not deregulate
in 1996, it misregulated.

II. In the short-term, California must provide support to the Utilities to
maintain reliability as they are doing with
the California Department of Water Resources purchases and the Utilities'
financial problems resulting from their
inability to recover power costs should be addressed immediately by the
State.

III. For the long-term, California should:

--Increase supply and reduce demand
--Bring retail rates in line with the cost of a reasonable portfolio of
electricity supply
--Allow customers to benefit stable long-term contracts
--Not abandon its commitment to foster retail competition.
(Here we should explain what we mean by each point and suggest solutions.
Our explanation should not
assume deep knowledge of the problem or the solutions.)

IV. The California "experience" does not mean deregulation leads to higher
prices for consumers and a lack
of reliable supply.

--The California crisis illustrates that true deregulation is the answer,
misregulation is not.
--There are ample illustrations of "good" state deregulation efforts.
--Current Federal efforts to increase supply and decrease demand should be
pursued.
--Federal efforts to increase incentives for power generation should include
regulatory policies
designed to extend open access to all uses of the bulk power transmission
grid so that power
can move freely to meet demand and new generation facilities may be brought
on-line.

V. Enron has been a positive presence in California.

--Enron is neither a net generator nor a net user of energy in California.
--We are in the business of making markets and making them work better.
--From the outset, Enron has been working with all parties to find
constructive, workable,
and well-tested solutions to California's problems.
--While we strongly disagree with the DOE supply orders, we have fully
cooperated with
them in California

VI. Time is running out. California must act soon, just as our Federal
efforts to put in
place a national energy policy should be soon.