Enron Mail

Subject:Retail market can be opened nationally?
Date:Thu, 21 Jun 2001 10:07:00 -0700 (PDT)

Restructuring Today readers got this story today...

Retail market
can be opened
Joe Barton thinks
it can and is
about to try
Once in 20 years
opportunity seen

How can the retail power market be opened in today's atmosphere?
Joe Barton has a way and it sounds like it just might work.
He briefed APPA members winding up the last day of the annual
meeting in Washington. Barton implored the membership that if they
have any ideas on how to improve energy policy, this is the time to tell
policy makers or him.
Barton sees a narrow, six-week opportunity as America is about to
revise its energy policy.
We walked with him to his car after the speech and asked what he
means by a major energy restructuring bill.
He referred vaguely to legislation that would improve the grid and
foster the functioning of a robust market providing for movement of
power from one place to another.
He wants a national market with a grid that can handle it "in an
open access way -- creating all these trading markets where you have
long-term and short-term markets where you balance supply and demand
around the country.
"States that have surplus power, through the RTO system can wheel
that power to states that need it."
That's the wholesale market, we asked.
But what about retail?
He hopes to get into the law a provision to foster aggregation of
How would that work?
"AARP," Barton said noticing our age, "could sell you power or Wal-
Mart or McDonalds or the co-ops. You could buy your power through
How would a law provide for aggregation?
"It would be in the federal legislation that it would be
permitted," he replied.
But what about Nebraska where there are only munis?
"You've got to work through that and see if you get some kind of
grandfather or state opt-out provision. It's possible that you give
states the right to opt out. But over time those states will want to
opt in," he added.
"That'll be a debate we'll have when we get into the bill. You're
not supposed to ask that tough a question this early in the process," he
reminded with a smile.
Barton is really impressed with the magnitude of the legislation
gestating in the nation's capital.
"Everything" is up for discussion, he said, "everything.
"There is nothing -- nothing -- that's been debated or talked about
in terms of electricity that is not on the table," Barton assured.
"I'm not saying we're going to do it all but you have a window like
this once every 20 to 30 years. I'm going to be damned if I'm going to
stand around and on my on volition take things off the table.
"Now the process will automatically take a lot more controversial
items out of play. There'll be a region or a political block -- who
knows the president might not like something. John Dingell might not
like something. Who knows? But I'm not -- even before we put pen to
paper to start drafting the bill -- say `we're not going to consider
this'," Barton added.
Is he getting signals from Dingell that he might be cooperative?
"Yeah. Very cooperative. Of course, again, the proof is in the
pudding and in the details."
Barton's in the leadership role in fostering a national energy
policy, taking the package from the vice president and guiding it
through the House.
He's the president's energy guy from an energy state and Bush has
shown -- with the tax bill -- that he can get a program enacted.
Barton wants something he can look back at in five, 10 and 20 years
and say "that's a good bill. It works."
Barton wants to make history with the Energy Policy Act of 2001.
Barton told APPA he wants this big bill to be "national, long-term
in its impact and balanced."
Balanced means looking at the generation component, transmission
and distribution "and in each of those areas -- this is just me. I'm
not speaking for anyone but myself" -- he wants "to create an
environment so we have a maximum, competitive situation that's open and
fair to everybody.
"And we're going to do that and you're going to have a lot of
competition, a lot of flexibility with a lot of choice for consumers and
a lot of choice for yourself," Barton added.
Wait a minute.
He's saying competition in transmission and distribution.
We really do need to ask him what he has in mind there when the
time is right.
We can't help but think of competition in selling pipeline capacity
in a secondary market.
You can do that with electricity capacity to or on a local
distribution system in gas. We're thinking aloud here. That's not what
Barton said.
He wants to minimize the federal role except where you actually
have to.
That puts Barton "a little at variance with some in the Bush
Administration and some in the Congress because in the modern age
there's a natural proclivity to centralize and consolidate which in the
political arena means let Washington do it."
Barton wants to maximize the technology component and will put into
the bill a distributed generation component.
He's interested in negawatts, fostering cut backs in demand on a
national scale.
"Looking out for your own interest," Barton considers to be
But from time to time you have to step back and look at the
national interest, he advocated.
"That's my job."
Today's crisis mentality helps Congress act boldly.
The friendliness to competitive markets in the White House
encouraged by the president's pride about the retail bill he got through
the Texas Legislature plus today's environment may be ideal for market-
minded leaders.

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Thank you,

Season Hawksley
US Publishing

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