Return to Transcripts main page

CNN Live At Daybreak

California Governor Davis Discusses Power Problems

Aired June 20, 2001 - 07:23   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
COLLEEN MCEDWARDS, CNN ANCHOR: New federal price controls on electricity rates in the West take effect today.

California Governor Gray Davis tells CNN's Kate Snow that they are a step in the right direction, but just one step.

(BEGIN VIDEOTAPE)

KATE SNOW, CNN CORRESPONDENT: This is your first appearance before a Senate committee. Time to answer a lot of questions. What do you intend to tell the committee?

GOV. GRAY DAVIS (D), CALIFORNIA: I intend to tell them two things. We're doing our part -- we're building 16 plants -- and we're saving more electricity than any state in America. I want them to help us do their part, because the federal government is responsible for regulating wholesale prices, and we paid $55 billion for power this year, and only $7 billion for essentially the same amount of power two years ago. That's not right.

SNOW: You're going to be under a lot of pressure. I would suspect there are going to be a lot of really tough questions. There are a lot of Republicans who blame you personally, who are out for blood. What's your strategy to handle that, to handle the intensity of it?

DAVIS: Well, my strategy is to make clear that we've done everything humanly possible to right the ship in California. No major plant was built the 12 years before I was governor. We've licensed 16. Ten are under construction. The first one will come on line in a week, and two more before July 7. In electricity conservation, you can't get any better than us, because we're number one, and we're trying to get better.

But they have to do their part in Washington, which is to give us relief. We need to have these prices rolled back, because Californians are being charged 700 times more for power this year than two years ago, even though we're conserving roughly 9 percent of the electricity we used to use. So by all rights, prices should be going down, not going up.

SNOW: Both of your senators from California said there's no longer a need for legislation to call for price caps, that the Federal Energy Regulatory Committee order was sufficient, at least for now. Senator Feinstein withdrew her bill for now. That seems to be a change in tact, and does that make it tougher for you now because you can no longer point the finger at Washington?

DAVIS: I certainly can point the finger at Washington. They took over a year to do what by law they should have done last November, and now they need to do step two. They took step one; it wasn't quite what we wanted, but it did provide us relief going forward. Now step two is to reimburse us for all the overcharges we were forced to make the last year while they were sleeping while we were complaining.

SNOW: There are ads running in your state now that specifically target you by name...

DAVIS: Yes, well. . .

SNOW: ... put the blame on you, the responsibility on you. Are they unfair?

DAVIS: I think Californians are galled by this because the very energy companies that bilked us out of $55 billion are not satisfied that the Federal Energy Commission has told them they have to make less money, and they're retaliating by attacking me. My job is to stand up and fight for 35 million people, and if they think they're going to shut me up, they have another thing coming.

SNOW: Republicans also are angry. They accuse you of hiring high-priced political consultants, two consultants on your payroll now. They say it's taxpayer money. It's inappropriate. It was a bad decision on your part. What's your response?

DAVIS: I'll tell you what's taxpayer money is $8 billion the state has had to pay to buy electricity this year because these out- of-state, greedy energy companies have bankrupted one utility and put another on the verge of bankruptcy. And the consultants I've hired, be they for energy, to help us on Wall Street, to help us get more megawatts, or with communications, are designed to fight against the bad guys who are these out-of-state energy companies taking us to the cleaners.

So these guys the Republicans are complaining about are the good guys. They're helping us fight the bad guys to get money back for our citizens, who have been grossly overcharged.

(END VIDEOTAPE)

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com