At energy forum, Clinton issues call for cleaner fuels

By DAVID IVANOVICH and LINDSAY WISE - Houston Chronicle - Feb. 29, 2008

Democrat Hillary Rodham Clinton on Thursday challenged the oil industry to lead the way to develop cleaner sources of energy to help tackle the nation's growing energy security problem.

"It is time for the oil companies to become energy companies," Clinton said.

Appearing before a crowd of more than 800 at the George R. Brown Convention Center just days ahead of Tuesday's Texas primary, Clinton likened the need to deal with the nation's energy security woes to the beginnings of the space race.

"We will get back to what we did so successfully after Sputnik went up," Clinton said.

Clinton was alone among the presidential hopefuls to join what was largely an energy industry crowd at the Greater Houston Partnership's America's Energy Future: Houston's Presidential Summit.

And despite that audience, she reiterated her pledge to end tax subsidies for the oil companies and to redirect that money to create new energy sources.

"I do not believe that now is the time when subsidies for the oil companies are necessary and appropriate," Clinton said. Instead, "it is now time to subsidize new forms of energy."

Less than two hours later, she attended a rally of an estimated 5,000 enthusiastic supporters in northwest Houston.

Reaction from the summit crowd, by contrast, was polite but fairly tepid, with business leaders remaining largely silent through most of the speech. About 150 members of the general public, who bagged free tickets for the event provided the most exuberant response.

"I thought it was terrific," said Colleen O'Brien of Pearland, who was impressed with the great detail of what Clinton called "more than a plan ... a strategy."

William Sweeney, Jr., vice president of government affairs for EDS, called it a "gutsy speech," coming to Houston to express a point of view that many in the audience didn't share.

With oil prices shooting up nearly $3 on Thursday to set a new record of $102.59 a barrel, Clinton told of meeting a man in largely rural southern Ohio who drives 71 miles to work and said the greatest economic challenge his family faces are gasoline prices.

If elected, Clinton said she would create a new National Energy Council, patterned after the National Economic Council and the National Security Council to deal with energy issues.

Clinton's speech capped off a day-long event featuring top executives addressing topics such as energy supply, conservation and renewable energy sources. And she has a very different view than much of the oil and gas industry.

She opposes, for instance, opening up the Arctic National Wildlife Refuge — believed to be the largest, untapped oil deposit left onshore in the United States — to oil and gas exploration.

But then her Democratic rival, Barack Obama, as well as John McCain, the likely Republican nominee, likewise oppose opening the refuge to drilling.

Clinton sole candidate to participate
Partnership officials had tried for months to attract all the presidential hopefuls to speak at the energy summit.

"Sen. Clinton is the only presidential candidate who saw the necessity of coming to this great summit," said U.S. Rep. Sheila Jackson Lee, D-Houston, a Clinton supporter. Clinton's presence at the forum "says she's willing to listen. She's willing to engage," Jackson Lee said.

Shell Oil Co. President John Hofmeister said Houston business leaders were "naturally disappointed" that other candidates declined to attend.

"But we don't tell presidential candidates where to spend their days," Hofmeister said.

While her views may be at odds with the oil and gas industry, Clinton still has received more money from the sector than any of the other remaining presidential hopefuls.

The most recent campaign finance reports filed by the candidates show Clinton has received $792,588 from energy and natural resources sector in this 2008 presidential race, according to the Washington-based watchdog Center for Responsive Politics.

That's more than both Obama — with $727,801 in contributions from the sector — has received and even more than McCain, who has picked up $630,650 in donations, the group said, using Federal Election Commission data released as of Feb. 20.


Rally at Delmar Fieldhouse
Following her summit speech, Clinton attended a late-night rally at the Delmar Fieldhouse in northwest Houston, where she told supporters, who were warmed up before her arrival by a mariachi band and a female Elvis impersonator, that she would win Texas.

"I have a feeling, and it's beginning to grow," Clinton told the crowd. "We are going to make it happen on Tuesday."

A Clinton aide said the campaign estimated 5,000 were drawn to the 6,000-seat arena.

Some like Bob Schoellkoph, 69, and his friend Axel Olsen, 64, arrived three hours before the doors opened to be first in line for the event.

"I've always been a Yellow Dog Democrat, all my life," said Schoellkoph, a real estate agent. "I support Hillary because she can carry on the legacy of President Clinton, which was really super, and she can pull us out of the deep ditch the Republicans got us in."

Read more in the Houston Chronicle

Deregulation - Why You Pay More

by lightseeker - Texas Kaos - Wed Jul 18, 2007
The short and sweet of this TV report is this:

But the bottom line is: Consumers in deregulated areas of the state are paying more. For 1,000 kilowatt hours, which is typical for a Texas home, TXU charges $129.70. Its lowest-priced competitor, Amigo Energy, charges $114.90.

But if you live in the state capital, your bill from Austin Energy is just $87.28.

And why? It's the free market stupid!

Deregulation: Raw deal for power users

Austin Energy operates much like TXU did before deregulation; the customer's bill is based on the cost of making electricity. The city of Austin owns gas-burning plants, coal-fired generators and part of a nuclear station. Because gas prices have tripled in recent years, they use the gas plants as little as possible, and pass the savings on to consumers.

"And that cost can be five to ten times as much as if you were able to get coal or nuclear-based power," explained Austin Energy spokesman Michael McCluskey.

TXU owns coal, gas and nuclear plants, too. But under the deregulation law, the power generation part of the company—Luminant—is now separate. It sells the power it makes to TXU and other competitors on the open market—often for much more than it costs to generate.

"They're charging you for all the electricity they sell, as if it were made from natural gas," Smith said. "About 60 percent of the electricty you consume is coming from coal and nuclear power plants, which provide electricty at a fraction of the cost."

Read more

Deregulation: Raw deal for power users
By GARY REAVES - WFAA-TV - Friday, July 13, 2007
AUSTIN — He's lowered the temperature; installed efficient lights; even installed a smaller dishwasher.

But frugality isn't the only reason Mike Sloan's electric bills are ridiculously low.

The primary factor is where he lives—Austin. The power company is owned by the city and is committed to keeping rates low.

Most Texans get power comes from private companies like TXU that also have to make a profit.

TXU in North Texas, like Reliant Energy in Houston, had been monoplies, with prices regulated by the state. State lawmakers figured if they broke up the monopolies and made them compete with one another, competition would push prices down.

Instead—fueled by the rising cost of natural gas—electric bills skyrocketed.

"You're paying a Cadillac price for Chevrolet power in the D/FW area," said Tom Smith, director of the Texas office of Public Citizen, a consumer advocacy group. "The reason TXU is charging you so much is because of deregulation."

Austin Energy operates much like TXU did before deregulation; the customer's bill is based on the cost of making electricity.

The city of Austin owns gas-burning plants, coal-fired generators and part of a nuclear station. Because gas prices have tripled in recent years, they use the gas plants as little as possible, and pass the savings on to consumers.

"And that cost can be five to ten times as much as if you were able to get coal or nuclear-based power," explained Austin Energy spokesman Michael McCluskey.

TXU owns coal, gas and nuclear plants, too. But under the deregulation law, the power generation part of the company—Luminant—is now separate. It sells the power it makes to TXU and other competitors on the open market—often for much more than it costs to generate.

"They're charging you for all the electricity they sell, as if it were made from natural gas," Smith said. "About 60 percent of the electricty you consume is coming from coal and nuclear power plants, which provide electricty at a fraction of the cost."

TXU spokeswoman Lisa Singleton said its Luminant division charges a "fair, market-based, wholesale price for the power produced." She said there were other factors beyond the price of gas that determine the price per kilowatt.

But the bottom line is: Consumers in deregulated areas of the state are paying more.

For 1,000 kilowatt hours, which is typical for a Texas home, TXU charges $129.70. Its lowest-priced competitor, Amigo Energy, charges $114.90.

But if you live in the state capital, your bill from Austin Energy is just $87.28.

Privately-owned utilities that are still regulated also charge less.
Amarillo consumers pay $78.84;
in Beaumont, 1,000 kilowatt hours is just $72.24.
Both cities get more of their power from cheaper coal or nuclear power, but since they remain regulated, consumers get the benefit of their lower costs.

Critics say these numbers prove deregulation isn't working. But a recent state study of the last four years says that without deregulation, we'd be paying even more.

"We concluded the average customer in Dallas and Houston has saved money—about $800 in Dallas and about $1,400 in Houston," said Barry Smitherman of the Texas Public Utility Commission.

He concedes that deregulation would have worked better if gas prices had stayed low. Smitherman says if customers will shop around, they'll put pressure on TXU and others to cut prices.

With time and competition, the PUC predicts rates will come down—but they're not likely to ever be as low as Mike Sloan's deal in Austin, where the power company is busy pushing a conservation scheme by installing thousands of thermostats designed to shut down air conditioners for up to 20 minutes an hour.

That will delay the need to build two new and expensive power plants.

Also Online
Texas Electric Choice from Texas PUC

Who benefits from electricity deregulation? from Public Citizen

TXU Energy official site

Austin Energy official site

More stories by Gary Reaves