Progress in Calif. Power Crisis

ByABC News
January 10, 2001, 2:01 AM

W A S H I N G T O N, Jan. 10 -- The major figures in Californias power crisisagreed to work to try to bring stability to the states electricitysystem, but six hours of discussions Tuesday produced no solutions.

Progress was made. All sides gave a bit, Energy SecretaryBill Richardson told reporters after the talks broke up shortlyafter midnight.

California Gov. Gray Davis also expressed optimism. We can seelight at the end of the tunnel, he said.

Stability vs Bankruptcy

High-level administration officials and all the major figures inthe California electricity wars met behind closed doors for sevenhours to try to fashion a framework for resolving the problemsfacing the states electricity supply system.

The parties agreed to technical meetings today and tohave all the principles meet again this weekend a sign that someagreement were fashioned during the marathon discussions Tuesday atthe Treasury Department.

The participants agreed on the need for cooperation tomaintain stability and avoid bankruptcy of California utilities,a statement issued by the participants said.

Holding Prices Down... Maybe

Davis, who has accused electricity wholesalers of price gouging,said that progress was made in working out agreement on long-termcontracts to hold prices down, but he gave no further details.

The private meeting brought together state officials, regulatorsand legislative leaders; the states three largest electricutilities; nine of the major power producers and brokers; and thechairman of the Federal Energy Regulatory Commission, which hasrefused to impose wholesale price controls sought by Davis.

In addition to Richardson, also at the meeting were TreasurySecretary Lawrence Summers and Gene Sperling, the presidents topeconomic adviser.

Before the session began, Sperling said the administration hopedto play an honest broker role and for the first time bring theparties together to possibly develop a framework for resolvingCalifornias energy problems.