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Bush Cabinet will meet over California power crisis


State faces threat of more rolling blackouts

WASHINGTON -- President Bush has called for a meeting Monday of some of his Cabinet members to discuss the California power crisis, but aides made clear that the administration wants the state to solve the problem.

"They should expect no more help from the White House," Bush economic adviser Lawrence Lindsey told CBS's "Face the Nation" program. "It's not that we don't want to give them the help. If we could send thunderbolts into the electric grid to run electricity, we would do it. We can't."

Lindsey said giving the state more electricity now would have "huge economic and ecological repercussions down the road."

Lights out in San Francisco


But the administration does plan to take a closer look at the problems facing the nation's most populous state as part of a broader White House discussion on developing a national energy policy.

"We're going to have a meeting tomorrow," Vice President Dick Cheney said on Fox TV. "The president's summoned the relevant Cabinet and agency heads to a session in the White House where we'll begin to focus on this."

Cheney, Treasury Secretary Paul O'Neill, Commerce Secretary Don Evans and Energy Secretary Spencer Abraham will join the president at the meeting.

Stage 3 alert through Monday

California faces the continued prospect of rolling blackouts, as its two biggest utility companies teeter on the brink of financial collapse, unable to buy enough power to meet Californians' demands.

Power problems in the state followed California's deregulation of its energy markets.

Lorie O'Donley, spokeswoman for the California Independent System Operator, which manages the power grid, said the state would remain under a Stage 3 emergency until midnight Monday, during which no blackouts would likely be necessary.

O'Donley said the ISO did not anticipate a surge in power demand from the Super Bowl on Sunday evening that could force the ISO into a heightened state of emergency.

Officials declare a Stage 3 emergency when operating reserves are forecast to be below 1.5 percent.

O'Donley said 7,000 megawatts of power remained unavailable to the power grid because of maintenance. But the system would get an additional 1,100 megawatts Monday, when two units in Northern California come back on line, she said.

The shortage has been most critical in Northern California, where there have been rolling blackouts. Southern California has not experienced the deliberate power shutdowns.

How other states could suffer

California's power supplies have run dangerously low as the state's two largest utilities, Pacific Gas and Electric Co. and Southern California have been hit by soaring wholesale power prices that, under the state's 1996 deregulation law, they cannot pass along to consumers.

The resulting financial crisis has left both companies on the brink of bankruptcy and without sufficient credit to buy the electricity their customers need -- causing shortages that twice this month forced power grid managers to order rolling blackouts across the northern part of the state.

On Tuesday, Bush gave California a two-week extension of an emergency order that required out-of-state companies to supply electricity and other energy to the state's power industry.

Lindsey and Cheney said Sunday the Bush administration will not grant another extension.

"We said two weeks, we mean two weeks," Cheney told NBC's "Meet the Press" TV show. "That's what they said they needed. That gives them ample time to address the issues that can only be addressed by California state government. And I'm hopeful that they'll get it resolved."

Cheney laid much of the blame to the way California's utilities were deregulated, giving them little incentive to build the power plants needed to meet the state's burgeoning demand for energy. As a result, Cheney said no major power plants have been built in California during the past decade.

Economic adviser Lindsey, speaking on "Face the Nation," said that meeting California's electricity needs had negative consequences for other Western states. For example, he said, water may be siphoned away from farmers in order to boost hydroelectric power production.

CNN White House Correspondent Kelly Wallace andReuters contributed to this report.

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