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THE NATION | SUNDAY REPORT

Bush's Energy Plan Bares Industry Clout

Cheney-led task force consulted extensively with corporate executives. Its findings boosted their interests. Environmental groups had little voice.

August 26, 2001|JUDY PASTERNAK | TIMES STAFF WRITER

WASHINGTON — Throughout February and March, executives representing electricity, coal, natural gas and nuclear interests paraded quietly in small groups to a building in the White House compound, where the new administration's energy policy was being written.

Some firms sent emissaries more than once. Enron Corp., which trades electricity and natural gas, once got three top officials into a private session with Vice President Dick Cheney, who headed the energy task force. Cheney did "a lot of listening," according to a company spokesman.

Many of the executives at the White House meetings were generous donors to the Republican Party, and some of their key lobbyists were freshly hired from the Bush presidential campaign. They found a receptive task force. Among its ranks were three former energy industry executives and consultants. The task force also included a Bush agency head who was involved in the sensitive discussions while his wife took in thousands of dollars in fees from three electricity producers.

The final report, issued May 16, boosted the nation's energy industries. It called for additional coal production, and five days later the world's largest coal company, Peabody Energy, issued a public stock offering, raising about $60 million more than expected. While Peabody was preparing to go public, its chief executive and vice president participated in a March 1 meeting with Cheney.

FOR THE RECORD
Los Angeles Times Friday September 7, 2001 Home Edition Part A Part A Page 2 A2 Desk 3 inches; 99 words Type of Material: Correction
Energy policy: In an Aug. 26 story about industry influence on the White House energy plan, the first reference to a March 1 meeting attended by Peabody Energy executives wrongly stated that Vice President Dick Cheney was present. The second reference to the meeting accurately identified administration representatives as Cheney's energy director, the secretary of Energy and the national economic advisor. In addition, the story erroneously reported that Peabody's chief executive officer made a personal contribution of $100,000 to the presidential inaugural committee. The $100,000 was a corporate donation from Peabody. The source of the money was incorrectly listed in contribution records.

The report also touted new gas extraction technologies. An early draft noted controversy over a gas recovery technique offered by Halliburton Co., the firm Cheney ran from 1995 to 2000, before becoming vice president. The plan released to the public deleted the negative language.

Cheney continues to resist demands by Congress to disclose who met with administration officials during the 106 days earlier this year when the energy plan was fashioned. The private nature of the work fostered candid and creative discussions "from new and unused quarters," said Cheney Press Secretary Juleanna Glover Weiss.

But interviews and a review of task force documents show how the administration relied on familiar faces who stood to benefit from the process.

Just once, the task force departed from its pledge to keep secret the names of people invited to pitch their opinions face to face. After producers of power from the sun, wind and geothermal heat met with Cheney, officials led the group to the front of the White House and waiting reporters.

The date was May 15, just one day before the plan was sent to President Bush.

Others whose views might conflict with industry--the Union of Concerned Scientists, the Sierra Club, even federal agency staff--found themselves shut out or overruled.

In the sessions they held while they worked on the plan, Cheney and his staff generally heard a message reinforcing their own mind-set: Free markets, fewer pollution rules and expanded development of traditional fuels.

Using less energy and energy in different forms were notions mentioned but not emphasized. "What do you expect?" asked one energy industry insider whose colleagues met with Cheney. "These people make their living from coal and natural gas and nuclear power. Do you think they're going to push for solar and wind?"

The influences are evident in the final product.

The report focuses on easing regulation for oil and gas drilling, coal-fired generators, nuclear power plants and transmission of electricity, while providing energy assistance to poor households. Though the plan also backs alternative fuels and conservation, it gives the most support to increasing the supply of traditional sources of energy.

One passage adopts word for word a proposal on global warming from the U.S. Energy Assn.'s National Energy Strategy, which is dominated by trade groups. The section suggests encouraging other countries to build factories with clean technologies sold by U.S. companies.

Even basic assumptions in the report were tailored to industry's measure.

A briefing paper prepared for a March 19 task force meeting with Bush said that, "on the whole, U.S. energy markets are working well, allocating resources and preventing shortages." But two months later, the final task force report proclaimed that "America faces the most serious energy shortage since the oil embargoes of the 1970s."

The energy situation hadn't changed. One staffer recalls seeing a memo that discussed "utilizing" California's rolling blackouts and the past summer's high-priced gasoline to press for more drilling for gas and oil.

The task force began work in late January, nine days after Bush's inauguration.

By all accounts, the vice president dominated the meetings. Energy Secretary Spencer Abraham; Bush's chief economic advisor, Lawrence B. Lindsey; and Environmental Protection Agency Chief Christie Whitman were the others with the most to say, one administration official said. But everyone jumped in on matters outside his or her own immediate jurisdiction.

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