Aides: Calif. governor may sue Bush over energy prices

LOS ANGELES, California (CNN) -- Senior aides to California Gov. Gray Davis said on Tuesday that the Democratic governor is contemplating a federal lawsuit to force President Bush to take action against rising energy costs.

Bush, in California to improve his approval ratings in the Western state, has scheduled a meeting with Davis on Tuesday afternoon, but neither is expected to budge from their positions.

Davis has called for short-term relief on the price of wholesale electricity -- enough to get the state through the hot summer months. Bush has spoken forcefully against price controls, saying such interference in the market will only worsen the problem.

Bush has criticized California for not building enough power plants to supply the state's demand for electricity, and cautioned during a stopover at Camp Pendleton near Los Angeles that "harsh rhetoric" would not solve the problem.

"It's certainly no time for name calling," the president said. "It's time for leadership. It's time for results. It's time to put politics aside and focus on the best interests of the people."

But Davis pointed to a federal statute that requires the president to take action to reduce energy prices if the Federal Energy Regulatory Commission (FERC) determines that the prices are unjust and unreasonable -- a finding FERC has made in several published orders.

"There was clear evidence that the California market structure and rules provide the opportunity for sellers to exercise market power when supply is tight and can result in unjust and unreasonable rates," FERC said on December 15, 2000. "Therefore, we reaffirm our finding that unjust and unreasonable rates were charged and could continue to be charged unless remedies are implemented."

FERC repeated its position in an order dated April 26.

"We are entitled to relief," the governor said earlier Tuesday in a public discussion with victims of the energy crunch, staged in the same hotel where Bush was staying. "It doesn't matter if someone thinks we should have relief, the law says we should have relief."

Davis was expected to hold a news conference after his meeting with Bush, where he may announce his intention to file suit in federal court. If announced, the filing could come as early as Wednesday.