Energy Secretary Richardson?

Speculation over who will replace outgoing Energy Secretary Federico Peña is heating up in earnest in Washington, D.C. The front-runner for the post, to be vacated by Peña on June 30, has long been thought to be Deputy Energy Secretary Betsy Moler. Moler, a former Senate Energy Committee aide, oversaw the government’s efforts to deregulate wholesale power markets, and by doing so, is the administration’s most knowledgeable member on electricity restructuring issues.

   Now, say those familiar with the situation, several other potential candidates for the post have surfaced. They include U.N. Ambassador Bill Richardson, former Senate Majority Leader George Mitchell, and Richard Holbrooke, a State Department negotiator. Word around Washington is that Richardson is the leading contender for the Energy Department post. However, Richardson, a former Democratic congressman from New Mexico, is certainly no shoo-in.

Will California Undo

Competition?

A coalition of California businesses, taxpayers, consumers, and labor groups is opposing a proposed ballot initiative to reregulate the state’s retail electricity market.

   The proposal to undo California’s competitive markets is being spearheaded by TURN, a utility watchdog organization that originally supported the restructuring law. TURN now says the law that opened California’s markets represents “an automatic $28 billion bailout” for the state’s investor-owned utilities, primarily because it allows the utilities to collect fees from all rate payers to pay off their uneconomic plant investments. TURN, which boasts 28,000 members, says it has gathered enough signatures to place the anticompetition initiative on the ballot, although this still must be verified by officials in each county.

   Opposing the reregulation is a new organization, Californians For Affordable and Reliable Electric Service, which includes California’s Business Roundtable, Retailers Association, Small Business Association, and Taxpayers Association, as well as the Coalition of California Utility Employees, a group associated with the International Brotherhood of Electrical Workers union.

Industrial Firms

Pick Suppliers

Retail customer choice continues to prove enormously popular with industrial companies:

   Lockheed Martin Missiles & Space has signed a four-year electricity supply deal with Enron Energy Services valued at $75 million. Enron, which is no longer pursuing California residential customers, will finance, construct, operate, and maintain a new energy infrastructure for Lockheed Martin Missiles & Space, one of the largest electricity consumers in Silicon Valley. The pact is expected to lower the defense contractor’s electricity costs and improve reliability of supply.

   IBM, Mitsubishi Silicon America, and NEC America have signed separate energy agreements with PG&E Energy Services worth more than $70 million. PG&E will supply about 70,000 megawatt hours to a Mitsubishi wafer fabrication plant in Salem, Ore., and to NEC’s telecommunications manufacturing facility in Hillsboro, Ore. PG&E will also supply electricity to three IBM facilities in San Jose, Calif. All told, PG&E Energy Services has signed long-term power agreements worth $1.5 billion.

Federico Peña announces on April 6, 1998 that he will resign his post as energy secretary

Retail Access Programs Prove Popular

In New York, Consolidated Edison’s retail access program — available to electricity customers in New York City and Westchester County — has proven enormously popular. Originally, the pilot program was limited to 500 megawatts of electric load, but Con Ed doubled the size of its pilot program in early May.

   Even so, the program has been vastly oversubscribed, with 75,000 customers applying to participate, representing 1,555 megawatts of electric load. Of those who applied, 10,000 were larger commercial and industrial customers. Con Ed, which recently announced it would buy Orange & Rockland Utilities, will choose which large commercial customers participate by lottery.

   Also, Pennsylvania has the most successful retail electricity pilot program in the United States — with more customers, more competitors, and a higher percentage of participation — according to Xenergy, a Burlington, Mass., energy engineering and consulting firm. Nearly one million Pennsylvania electricity customers have said they want alternate electricity suppliers. Pennsylvania’s electricity market will be open January 1.