Mr. Chairman, thank you very much for holding this hearing. It is particularly timely.
Californians have suffered rolling blackouts and are bracing for more. Darkness spread across some of the most vibrant places in America - from the most complex high-tech factories to the busiest streets. Day-to-day functions of the populace are affected. Large utilities are now billions in debt.
Today's hearing may shed light on how California got into this situation and whether there are lessons in this experience for other states.
We have been discussing electric utility restructuring for the last several years, but we were not able to agree on a comprehensive solution. It is conceivable that the current situation in California may cast a shadow on the efforts of other states as well as on what is being considered at the national level. We must draw from the experience in California and develop suitable approaches that serve Americans. These approaches must embody lower prices, technological efficiency, environmental improvements, enhanced reliability, and increased innovation in pricing and services.
We must determine what type of Federal action is needed to ensure uniform national standards of competition and the development of robust competitive markets. In addition, we must adopt a definitive process that facilitates the transition to fully competitive electric markets, causes minimum structural upheaval, eliminates confusion, and allows for an orderly transition. We may be able to accomplish in the 107th Congress something that we were not able to accomplish in the 106th.
We may face bigger challenges. Some say that California has cast its shadow over all the restructuring plans. Mr. Daniel Yergin, an energy expert and chairman of Cambridge Energy Research Associates, is quoted in Time magazine, as saying "The California crisis puts the questions about our entire energy infrastructure front and center." He is exactly right. We have had an astonishingly effective utility system in our country for many decades. We must ensure that we do not lose that effectiveness as the economic well-being of our nation depends on an effective utility system. If we are to serve the best interests of the American people, we must learn from the California experience and move on.
Last year was not a very good one as far energy is concerned. We had many problems with gasoline - short supplies, pipeline problems, cleaner gasoline requirements, oil company manipulations, even an esoteric patent dispute, to name a few. We had problems with the supply of home heating oil. Natural gas prices spiked, reaching their highest levels in 15 years. OPEC was up to its old tricks. The whole country suffered high energy prices last year, but for the people of Hawaii high energy prices have been an ongoing saga for a long time. We have all had enough.
Mr. Chairman, we cannot look at our energy sources in a piecemeal fashion. We will have to take a comprehensive look at all aspects of our energy picture. The only way to deal with our energy problem is to have a multifaceted energy strategy and remain committed to that strategy. We must adopt energy conservation, encourage energy efficiency, and support renewable energy programs. Above all, we must develop energy resources that diversify our energy mix and strengthen our energy security.
I am interested in what the witnesses have to say.
