STATEMENT BY U.S. SENATOR DIANNE FEINSTEIN
- On the Decision by PG&E to Declare Bankruptcy -
April 6, 2001

"This is a sad day for California. With PG&E filing for bankruptcy, the state, the utility, investors, shareholders, creditors, and most importantly, the people of California will all be losers at the end of this process. Now the future of PG&E as well as its 13 million California customers rests with a bankruptcy judge.

It should not have come down to this. There is no question that it magnifies the crisis and makes the outlook for this summer even more precarious. I hope Governor Davis will move immediately to consummate the pending agreement with Southern California Edison, so that this utility does not follow PG&E into bankruptcy.

I also hope that the Bush Administration finally realizes that the failure of the federal government to step in and ensure 'just and reasonable' wholesale electricity rates has played a major role in this crisis.

It is inexcusable that the Federal Energy Regulatory Commission (FERC) has refused to intervene and provide temporary stability and reliability in order to prevent the dramatic escalation of prices and market manipulation by power generators that has helped cause this bankruptcy.

Because of this failure to take action by FERC, Senator Gordon Smith (R-Oregon) and I intend to introduce our bipartisan, compromise legislation when the Senate returns from recess, mandating that FERC establish cost-of-service based wholesale electricity rates on an interim basis in the Western region. This legislation is made even more important now."

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