Gray Davis on Energy & Oil Former Democratic CA Governor

Says his mishandling of energy crisis prompted recall

DAVIS: I think that I was too slow to act on the energy crisis. This is what we were facing faced with. People ought to know. Everyone told me to raise consumer rates even though the promise of deregulation was that rates would go down.

I felt something was amiss, either with the utilities or energy companies and consumers should not have to pay the full load.

Everyone asked me to do it. I hesitated, hesitated because I did not want to do it. Eventually we raised the rates 10 to 20%, not the 400% we wanted. We built 24 plants. People conserved magnificently. Our lights did not go off two weeks ago, like they did on the East Coast and in London, because we have made the investments and generated the conservation to prepare for California’s future.

Wants to get past recall to get to re-regulating energy

Addressing energy demand as well as supply

We have to do a better job than we’re doing but we’re already extraordinarily efficient. I have, for example put in an 800 million dollar conservation program to incite businesses and individuals to be much more energy efficient.

Another notion is that we never built any plants. There is truth to that because for the 12 years preceding my governorship, not one major plant was built. But starting in April 1999, we started approving plans. We approved nine, six are under construction; three will be up by this summer. And there are 14 more in the pipeline. So both on the conservation side and on the demand side we have stepped up to the challenge and answered the call.

Voluntary partnerships reduce greenhouse gases economically.

Considering the evidence and the risks of both overreaction and underreaction, the Governors recommend that the federal government continue its climate research, including regional climate research, to improve scientific understanding of global climate change. The Governors also recommend taking steps that are cost-effective and offer other social and economic benefits beyond reducing greenhouse gas emissions. In particular, the Governors support voluntary partnerships to reduce greenhouse gas emissions while achieving other economic and environmental goals.
• The Governors are committed to working in partnership with the federal government, businesses, environmental groups, and others to develop and implement voluntary programs that reduce greenhouse gas emissions in conjunction with conserving energy, protecting the environment, and strengthening the economy.
• The Governors urge that those who have successfully achieved reductions of greenhouse emissions receive appropriate credit for their early actions. The Governors strongly encourage these kinds of voluntary efforts.
• The Governors believe that federally required implementation of any treaty provisions, including those that mandate limits or reductions of greenhouse gas emissions, must not occur before the U.S. Senate ratifies an international agreement and Congress passes enabling legislation.
• The Governors support continued federal funding for research and development technology in this area. They also believe it is essential to engage the private sector by fostering technology partnerships between industry and government. Public-private partnerships serve to achieve desired environmental goals, speed the introduction of new technologies to the marketplace, and meet consumer needs and product affordability goals, while avoiding market distortions and job losses.

Kyoto Treaty must include reductions by all countries.

The Governors recommend that the federal government continue to seek the advice of state and local officials and nongovernmental organizations with expertise in economic, trade, jobs, public health, and environmental issues and assess the potential economic and environmental consequences of proposed policies and measures, including a thorough and broadly accepted analysis of costs and benefits. The Governors recommend that the US:
• not sign or ratify any agreement that mandates new commitments to limit or reduce greenhouse gas emissions for the US, unless such an agreement mandates new specific scheduled commitments to limit or reduce greenhouse gas emissions for developing countries within the same compliance period;
• aggressively undertake strategies for including emissions-reduction commitments from developing countries;
• not sign or ratify any agreement that would result in serious harm to the US economy;
• support flexible policies and measures in continuing negotiations that provide an opportunity for the US to meet global environmental goals without jeopardizing US jobs, trade, or economic competitiveness;
• insist on flexible implementation timetables in continuing negotiations that permit affected parties adequate time to plan strategies for meeting commitments; and
• ensure that no single sector, state, or nation is disproportionately disadvantaged by the implementation of international policies.

Federal tax incentives for energy, with state decisions.

1. Western Governors find that states must continue to play a pivotal role in electric power decisions. Specifically:
   • The existing authority of states over retail electric power sales and transmissions must be retained.
   • Congress should allow states to create regional mechanisms to decide regional power issues.

1. We need to pursue a national energy policy that will result in a diverse energy portfolio:
   • New energy development: Enable exploration and development of promising domestic oil, gas, coal, geothermal or wind resources.
   • Coal: Implement R&D and tax incentives to promote the development and deployment of new technologies.
   • Renewables: Accelerate the development and deployment of promising renewable energy technologies through the extension and expansion of state and federal production tax credits.
   • Environmental Regulation: Review environmental and natural resource policies to ensure they are as efficient as possible.
   • Permitting Energy Facilities: Streamline state, tribal and federal processes for siting new generation, electric transmission and natural gas pipelines.
   • Energy Infrastructure: Support economic and environmentally sound energy infrastructure investments to transport energy to markets

1. Energy efficiency and conservation: At a minimum:
   • Encourage rate structures that give utilities and customers an incentive to reduce consumption.
   • Encourage long-term stability of government and utility conservation programs.
   • Review and improve the energy efficiency of building codes and appliance efficiency standards that recognize the unique conditions in the West (e.g., dry climates).
   • Support federal, state and tribal tax incentives to accelerate the introduction of new energy efficient technologies.