For the past several months, analysts and pundits have been using the term “the new normal” to describe post-recession economic conditions. The phrase describes a variety of changes, from stock-...
An Invitation From Ken Lay
Enron holds court on electric restructuring, exposing deep industry divisions and the polarization of views.
It was held in early October, an unusual, invitation-only, private meeting dubbed , which brought together some of the most notable minds in the energy industry. The idea was to invite some of the top industry thinkers to the same table to sort out electric competition's troubles. The result was to expose the deep, persistent divisions and disillusion with electric competition's progress.
Even with academics from Harvard's Electricity Group, all four FERC commissioners, representatives from state legislatures and PUCs, former DOE officials, congressmen, top executives representing utilities and associations, and, of course, yours truly, no clear consensus could be reached when discussing details. Of course, many of the disagreements, or agreements, could be understood in terms of the long held political and business agendas that were represented by the people attending.
For instance, why was Enron intent on quizzing us on what sort of policy initiatives could be accomplished in 12 to 16 months under certain energy pricing and political scenarios? Enron's agenda seemed clear. Enron's CEO, Ken Lay, since reassuming the helm of the company, has just recently redirected the company's focus back to energy trading. Lay, like many of his energy-marketing peers, wants to be able justify to shareholders that he is embarking his company on a strategy that will continue to be profitable-pretty much a standard corporate concern.
Enron CEO vs. Washington PUC Chairwoman: The Gloves Come Off
Not surprisingly, Lay's view on the benefits of retail competition clashed with agendas held by representatives from PUCs and state legislatures from California and the Northwest. The Harvard educated chairwoman of the Washington Utilities and Transportation Commission, Marilyn Showalter, expressed deep reservations about the promise of retail competition bringing lower prices to her already low-priced state. Lay and Showalter had several verbal skirmishes throughout the day on the issue. Of course, at the end of the meeting, during evening cocktails, both Lay and Showalter continued their debate, oblivious to everyone around them. I got the sense that they could discuss the issue for days, and neither of them would ever give in to the other's position. I also got the sense that they each enjoyed the debate-the thrill of battle-as it were.
That was the strength of Enron's meeting, the fact that they invited people with opposing views on electric competition, in a forum where debate was encouraged. Of course, as a result, this meeting exposed how polarized the industry continues to be on many issues.
In fact, so intrigued was the to hear sometimes extreme and very much opposite views on electric competition between policy makers such as FERC Chairman Pat Wood III and Washington PUC Chairwoman Showalter, that we asked them both to detail their views in the upcoming Nov. 15 issue, known as .
The magazine recognizes, as many have, that the federal vs. state debate will continue to be at the center of any discussion on realizing electric competition, and tensions have heated up between