Matthews let energy industry rep spin 2000 Calif. blackouts as "a lack of generation"; ignored Enron's market manipulation
In discussing blackouts that affected portions of Los Angeles on September 12, energy industry representative Jim Owen attributed California's energy crisis in 2000 and 2001 to "a lack of generation." On the 5 p.m. ET September 12 edition of MSNBC's Hardball with Chris Matthews, Owen claimed that there were "not enough power plants that were in the state back then and inadequate transmission facilities." Host Chris Matthews did not challenge Owen's assessment, despite reports that market manipulation by the Enron Corp. was a key factor in California's surging energy prices and rolling blackouts in 2000 and 2001.
Owen works in "Media Relations" for the Edison Electric Institute, which describes itself as "the association of United States shareholder-owned electric companies, international affiliates, and industry associates worldwide."
From the 5 p.m. ET September 12 edition of MSNBC's Hardball with Chris Matthews:
MATTHEWS: Of course, I've got to go to Jim Owen on the tricky political question. Gray Davis, the recent governor of California, owes his dismissal by the people to questions and problems they had with regard to energy. Does this relate to that? What's going on now in L.A.?
OWEN: I would tend to think that this is not really related to that, Chris. It's premature to try to make any sweeping generalization, political or otherwise, but it would appear, based on what we've heard and what your own network has reported, that this appears to be a relatively localized cause of an outage that again, for reasons that we discussed, obviously spread throughout a densely populated political -- excuse me -- a densely populated area. The problem that you alluded to earlier, back when Gray Davis was governor, really had to do with a much more complex and broader set of factors having to do with a lack of generation. In other words, not enough power plants that were in the state back then and inadequate transmission facilities. Some of those dynamics still apply. I mean, there are many people who still feel that there are not enough power plants in California, and while they are certainly trying to redress some of the issues relative to transmission -- to power lines -- you know, they still have some way to go there too. But I think things are certainly better than they were back then.
MATTHEWS: Jim Owen. Thank you very much for joining us from the Edison Electric Institute, and you represent all those power companies, those utilities, including Los Angeles.
Notably absent from Owen's explanation of the 2000 California energy crisis is the widely reported role of Enron, which went bankrupt in December 2001. According to a July 16 Los Angeles Times article, Enron "played a key role in the yearlong market meltdown that brought record prices and rolling blackouts to the customers of Southern California Edison Co., Pacific Gas & Electric Co., and San Diego Gas & Electric. Enron's traders devised schemes with such names as 'Fat Boy' and 'Death Star' to manipulate the energy marketplace in California and other Western states -- behavior captured in well-publicized recordings of company employees gloating over the plight of 'Grandma Millie' and other hapless ratepayers."
A February 4 San Francisco Chronicle article reported that "the company used elaborate trading schemes to create the appearance of power shortages in some cases and congested transmission lines in others." According to the Chronicle, "Phone transcripts show Enron searching for reasons to shut down one of its power plants during the height of the California energy crisis, eventually closing the plant as blackouts rippled across the state. ... One transcript includes an Enron trader, identified by the utility district as Bill Williams, calling an operator at the company's 52-megawatt Las Vegas power plant on Jan. 16, 2001, and asking that it be taken out of operation the following day. 'We want you guys to get a little creative ... and come up with a reason to go down,' he says in the transcript." Enron manipulated the California energy market (decreasing the energy supply during periods of high demand) in order to, as Time put it on May 20, 2002, "squeeze cash out of energy hungry California," and generate "maximum profit regardless of the effect on consumers."
Come on it was just Kenny Lay having some fun! Didn't have anything to do with kicking Gray Davis out. Hell those Californians just need to be taken down a peg. What will be the shake down of the Enron case? Will California get back the money we had stolen from us? Thanks to Enron we have the Govenator. Politics suck. This is the greatest country in the world but the Republicans and Democrats are taking it down fast. Green Peace and Restore the Environment. We need new agendas and new parties that aren't bound to Corporations and their greed.
Reform the political system by require all federal elections be totally publically financed. Expensive, you bet, means more taxes. However, if it would break the strangle hold of corporate lobbists on the government the good that would come of it would be enormous -- including the lowering of prices of core products now "regulated" by law, I'm talking to you drug, financial, energy, and election industries. Start by demanding that television stations alot each candidate x amount of time inverse to the amount of money they raise and that all legitmate candidates get air time during the debates (not just the ones that have their interests protected by the FEC monopoly) -- both parties should love that. Then reinvent the FEC, how can they be neutral it represents those that together own the field of play? 1/2 Dem.s + 1/2 Repub.s = everyone else screwed. Hate the players and the game.
ufleirx, you have brought up a very good point regarding what at one time were public airwaves and the access given to the few by the FEC and the FCC. These airwaves should be freed from the grip that these power-hungry few have and maybe we could return to a media that can be honored and trusted. Don't hold your breath, these same fascists have a plan to eliminate forums such as this and take away one of the last bastions of free speech.
As far as this topic is concerned, i am a victim of the Enron/Cheney energy plan that had all of us in Ca. pay out to pals of Bush/Rove/Cheney during the phony blackouts created by these Bush supporters. With the Gropenator as Gov, California is in the same hands as back in 2000, politicians drowned in money from these same corporate interests. There is no plan for decreasing energy use in this state, only the same as Bush and co., more consumption, less incentive to conserve. Is anyone surprised? For Matthews to let this canard to live at this time is just what we should expect, the corporate media looking out for their corporate partners in crime. Just as Bush has done nothing but help build the corporate profits of these energy giants, the Gropenator has done even less, oh yeah, he said he will run for re-election of the great state of Cauleeforneeeahh.
This whole thing was a scam as anyone who has seen the documentary on Enron knows or if like me you live in California and don't let your ideology get in the way of reality. This scam kept the shell game known as Enron going for a little while longer by infusing cash into the dying company.
About a year before the whole state of California "deregulated" the power industry, San Diego had already pursued this "free" market fantasy.
You might ask what was the result?
Power bills for homes and business tripled or quadrupled what they were before "deregulation". I read it myself in the newspaper and unless you were brain dead it couldn't have been hard to figure out what would happen when the whole state did the same thing.
The state of California is owed about 9 BILLION which it will never get.
There were plenty of power plants. Unfortunately there were also plenty of worthless skumwads like Ken Lay.