Recent blackouts in California have made national headlines. To many people, this situation is a little difficult to comprehend—California is hardly a poor state. Even more odd, the problem only promises to get worse during the upcoming summer heat. While the impact of too little electricity and rising utility bills would seem to have vast implications for the economy, the White House has shown little inclination to get involved. FRONTLINE gathers the complex strands of Blackout by talking to Governor Gray Davis of California, Vice President Dick Cheney, federal and state officials, and a number of Texas energy brokers from Enron, Duke Energy, and El Paso.

There are two sides to this shadowy tale. In interviews, Vice President Cheney, Chairman of Enron Ken Lay, and FERC (Federal Energy Regulatory Commission) Chairman Curt Herbert, all believe that the California energy crisis has been overstated. They also believe that the root of the current problem can be traced to F.D.R.’s regulation of the power industry in the 1930s; through deregulation, the consumer will eventually have more choices and lower prices. "The rules of competition govern that economies work, that choice works," says Herbert. "It’s why we’re American." No one, though, wants to talk about why power prices have risen from $40 to as much as $1900 per megawatt hour, or about Enron and Duke Energy’s enormous profits, or about motions filed against energy companies for manipulating market prices.

California’s electric bill went from seven billion in 1999 to twenty-seven billon in 2000. Nettie Hoge, executive director of The Utility Reform Network (TURN), finds the idea that there is an energy shortage "preposterous." "…[T]he new plant owners and the traders, like Mr. Lay’s organization, looked at the data and figured out how to manipulate the market." Deregulation meant that FERC, as opposed to state commissions, would be the governmental body to make sure rates were "just and reasonable" as called for in the 1935 Power Act. But FERC has been slow to respond to complaints; the organization has also done little to seek redress for over-billing when it has been discovered (6.2 billion in California, though FERC says that it only has jurisdiction over 1.3 billon). Many attribute this reluctance to the current climate in Washington and to the fact that Republicans received 80% of the 32 million dollars donated by oil and gas companies during the last election.

California’s problem could soon be New York’s, and many other states’, problem. Consumers, at least in the short run, will take the brunt of deregulation, whether that means blackouts or higher electric bills. Blackout may not have solved the problem of whether or not deregulation will eventually work; it does make clear, however, that energy brokers like Enron and El Paso are getting filthy rich in the interim. It is fascinating that these CEOs even agreed to talk to FRONTLINE, because these men and women seldom come across as defenders of the public’s best interests. Blackout is another investigative victory for the FRONTLINE crew, helping to make sense out of a complicated public issue.

Ronnie D. Lankford, Jr.

Blackout will air on June 5th at 10:00 P.M. on P.B.S. For more information about FRONTLINE, go to

Review by Ronnie D. Lankford, Jr.

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