Statement of Senator Dianne Feinstein on a FERC Administrative Law Judge Decision that El Paso Natural Gas "Withheld Extremely Large Amounts" of
Natural Gas that could have Flowed to California
October 31, 2002
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Washington, DC - Federal Energy Regulatory Commission (FERC) Chief Administrative Law Judge Curtis L. Wagner Jr. today issued an initial decision that held that El Paso Natural Gas "withheld extremely large amounts of capacity" of natural gas that could have flowed to California during last year's energy crisis.

Judge Wagner has recommended that the FERC institute penalty procedures for the violation of standards and for the exercise of market power. The following is the text of Senator Feinstein's statement:

"This is a tremendous victory. Judge Wagner's decision validates what I have long suspected - and described in floor speeches and other speeches - that by withholding natural gas capacity in the pipeline, El Paso Natural Gas caused natural gas prices to increase by nearly 600 percent.

This caused two significant problems. First, consumers in Southern California were forced to pay exorbitant prices for natural gas.

Second, because so much of California's electricity supply is fueled by natural gas, this meant that electricity prices went through the roof - causing hardship to the publicly-owned utilities and to the State - neither of which could pass on these high prices to California consumers.

I intend to ask Energy Committee Chair Jeff Bingman to hold a hearing on this matter so that this new evidence can be evaluated and that we can learn the extent of this manipulation."

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