Meeting in Washington to grapple with California energy shortage

From CNN White House Correspondent Kelly Wallace

WASHINGTON (CNN) -- President Clinton's economic advisers plan to convene a meeting of state and federal officials next week in Washington to try to ease the current electricity shortage in California, the White House said Saturday.

The goal is to "try to create some sort of framework that could help to alleviate the supply crunch that California is now experiencing in energy," said Jake Siewert, White House press secretary.

California's recent move to deregulate its electricity industry and the state's failure to construct new power plants has been blamed for the electricity shortage.

WEB EXCLUSIVE Online coverage of the energy crunch in California  VIDEO CNN's Greg Lefevre explains how the energy crisis is affecting people's habits Play video (QuickTime, Real or Windows Media)     ALSO Californians wonder how to do more to cut energy use

The utilities say the shortage is caused by rules that block them from purchasing long-term contracts that allow them to buy electricity in bulk at a much cheaper rate.

The announcement comes after the California Public Utilities Commission voted unanimously Thursday to impose a rate hike on businesses and residents.

Power company executives have complained that the deregulated market has caused them financial hardship. The hike is designed to help utility companies pay for electricity, which becomes extremely expensive during times of short supply.

Utility execs, California governor to attend

Those expected to attend the meeting include California utility executives, the state's Democratic Gov. Gray Davis, and the head of the Federal Energy Regulatory Commission.

The president's economic adviser, Gene Sperling, Treasury Secretary Lawrence Summers and Energy Secretary Bill Richardson are scheduled to host the gathering.

Nobody happy with California power rate increase
January 4, 2001
California regulators recommend rate hikes for utilities
January 3, 2001
California guaranteed power for another week
December 20, 2000
Energy secretary urges immediate action on West Coast power crisis
December 19, 2000
Federal commission could act today on Western power crunch
December 15, 2000

Consumers Union -- San Francisco, CA
Pacific Gas and Electric Co.

Note: Pages will open in a new browser window

External sites are not endorsed by CNN Interactive.