07.17.01

Senator Maria Cantwell Urges President Bush to Hold Energy Town Hall Meeting in Washington State

WASHINGTON, DC - U.S. Sen. Maria Cantwell (D-WA) today invited President George W. Bush to extend his series of town hall meetings on energy issues to include Washington state, so he can hear first-hand how the energy crisis is affecting consumers and businesses in the Pacific Northwest. Cantwell commended the President for holding the meetings, but cautioned him about the dangers of failing to schedule any meetings in the West and making attendance "by invitation only."

"I am concerned about two aspects of your plan," Cantwell wrote in a letter to President Bush. "First, your schedule of town hall meetings doesn't include any locations in the 11 Western states where people are already suffering serious effects due to the national energy crisis. Second, Vice President Cheney announced over the weekend that attendance at these meetings would be by invitation only. Such an approach may actually hamper, rather than enhance, your efforts to understand the far-reaching effects of the current crisis and America's future energy needs."

Cantwell said later she was concerned that by tightly controlling attendance and avoiding the West, the Bush Administration may create the appearance that the President is attempting to orchestrate public comment about one of the most critical issues facing the nation.

Cantwell has been pushing the Federal Energy Regulatory Commission to stabilize Western energy markets and to ensure refunds for Pacific Northwest ratepayers who have suffered from excessive energy prices over the past year. In her letter to President Bush, she gave several examples of how people in her state are being harmed by skyrocketing energy prices. Cantwell recounted one story about a Spokane school district that has been forced to divert $200,000 to pay its energy bills instead of buying textbooks, and another about a small, 100-year-old steel foundry in Tacoma that may have to close its doors if its energy costs continue to rise beyond the 60 percent increase it has already endured.

"These are serious problems, Mr. President. They deserve serious attention, thoughtful leadership and conscientious public review," Cantwell wrote. She urged the President to schedule a meeting in Washington state, "To better understand these issues, not only as consequences of the current energy crisis, but also as a warning of what lies ahead if we fail to craft a meaningful national energy policy that balances new production with greater efficiency and sustainable resources . . . "

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July 17, 2001

President George W. Bush The White House 1600 Pennsylvania Avenue, N.W. Washington, D.C. 20500

Dear Mr. President:

I want to commend your decision to hold a series of town hall meetings on energy issues. The energy crisis currently plaguing the Western United States, and our need for an enlightened and effective energy policy to address America's long-term energy needs, are issues that require determined leadership and a deep understanding of their effects on the American people.

At the same time, I am concerned about two aspects of your plan. First, your schedule of town hall meetings doesn't include any locations in the 11 Western states where people are already suffering serious effects due to the national energy crisis. Second, Vice President Cheney announced over the weekend that attendance at these meetings would be by invitation only. Such an approach may actually hamper, rather than enhance, your efforts to understand the far-reaching effects of the current crisis and America's future energy needs.

I would like to extend an invitation for you to expand your current schedule and hold an additional energy town hall meeting in my home state of Washington - a state with an historic commitment to both environmental protection and energy production and conservation. Washington is not only home to native salmon runs and millions of acres of national forests, but also to hydroelectric dams that supply millions of kilowatt hours of electric power. Washingtonians have always faced the challenge of learning to use natural resources without destroying them - but it's a challenge that never ends.

Meanwhile, Washington state, its economy, its citizens and its environment have all been deeply and negatively affected by the current electricity crisis and the resulting unjust and unreasonable rates. This outcome was inevitable because the Western energy market is interlinked, so problems from California could not fail to impact the Pacific Northwest. Unfortunately, the simultaneous occurrence of a drought has exacerbated the damage, because Northwest utilities have had a greater need to supplement scarce hydropower with alternative sources of electricity.

Skyrocketing energy prices have caused retail electricity rates to rise in every corner of my state:

20 percent in Clark County, 30 percent in Cowlitz, Skamania and Okanogan counties; 35 percent in Snohomish County; and 50 percent in the cities of Tacoma and Seattle.

Yet even as these utilities have passed on these rate increases, some have been forced to issue hundreds of millions of dollars worth of bonds to cover the cost of power. For example, the City of Seattle normally spends less than $100 million per year on power purchases. This year, the City spent over $450 million to keep the lights on - in just the first six months. And while the Seattle utility, in the first 98 years of its history, issued a total of about $1 billion in bonds, it has issued $700 million in debt this year alone to pay its purchased power bills. A number of Northwest utilities have also had their bond ratings downgraded.

Energy-intensive industries such as aluminum smelting and pulp and paper production have been driven to the brink of collapse, and the layoffs already number in the tens of thousands. There are innumerable other businesses that are teetering on the brink and simply cannot absorb any more rate increases:

Georgia-Pacific shut down its pulp and paper mill in Bellingham, Washington, laying off 420 workers. Abitibi, another paper company in Steilacoom, had to idle its workforce due to escalating power prices.

Washington state's aluminum industry, which provides my state with about 7,500 family-wage jobs, has curtailed a large part of its production anywhere from six months to two years-and it is unclear if the companies will ever resume production at current levels. These companies, which produce about 40 percent of the nation's aluminum, have given up more than 75 percent of their power supply to help minimize the region's Bonneville Power Administration rate increase.

Due to drought conditions and the cost of purchasing power for irrigation, many Washington state farmers have chosen to forgo planting this summer. Because agriculture is already one of the most stressed industries in Washington, the impacts of the current energy situation are particularly devastating. Many of our irrigators are being paid not to farm, based on energy savings compared to their usage the previous year. But when irrigators can't farm, that has ramifications for entire communities and related businesses, such as cold storage, food processing and transportation.

The effects on small businesses have been equally harrowing. At a Senate Small Business Committee field hearing last month, my colleague Chairman John Kerry and I heard from the president of a steel foundry based in Tacoma, which has been in operation since 1899 and employs about 350 people. In the face of this crisis, the plant has undertaken an aggressive conservation program, which has helped it reduce its power consumption by 20 percent. At the same time, the foundry has increased its efficiency and will actually produce more steel this year. But despite its extraordinary efforts, the plant's power bill has increased more than 60 percent, virtually eliminating any profits and already forcing a handful of layoffs. In the words of the company's president, any further rate increases will mean the foundry will have to close its doors.

The Bonneville Power Administration, which provides Washington with 70 percent of its power, will be forced to raise its rates another 46 percent this October. This increase will lead inevitably to more plant closings and layoffs.

Consumers are being hit equally hard. Our LIHEAP caseload in Washington state is expected to grow 50 percent this year on account of rising energy costs. With the coming rate increase this fall, those consumers on fixed incomes may have to choose between heating their homes and buying food and prescription drugs. And our schools are being forced to cut corners. The Central Valley School District in Spokane, for example, has had to divert $200,000 to pay its energy bills - money that otherwise would have been used to purchase textbooks.

These are serious problems, Mr. President. They deserve serious attention, thoughtful leadership and conscientious public review. To better understand these issues, not only as consequences of the current energy crisis, but also as a warning of what lies ahead if we fail to craft a meaningful national energy policy that balances new production with greater efficiency and sustainable resources, please accept my invitation to hold a town hall meeting in Washington and to hear for yourself what the people of my state have to say about energy.

Sincerely,

Maria Cantwell United States Senator