Calif. governor demands $9 billion in refunds

WASHINGTON (CNN) -- California Gov. Gray Davis urged federal regulators Wednesday to do more to restrain electricity prices in his state and demanded almost $9 billion in refunds from power generators.

Davis told a Senate hearing his state was the victim of "egregious overcharges" by out-of-state power producers. He called on the Federal Energy Regulatory Commission to take action.

Davis called the commission's decision Monday to adopt a price mitigation plan in California and 10 other states a positive but insufficient move.

"FERC must move quickly to enforce the law. FERC must order these energy companies to give us back our money," he said.

Davis and the FERC commissioners appeared before the Senate Governmental Affairs Committee. Its chairman, Connecticut Democrat Joseph Lieberman, opened hearings this week into the recent energy problems plaguing California.

Davis has accused out-of-state suppliers -- particular those based in Texas -- of gouging California consumers.

VIDEO CNN's Kate Snow reports on Gov. Gray Davis' allegation that Californians have been overcharged for energy (June 20) Play video (QuickTime, Real or Windows Media)

GOP lawmakers, however, said Davis must accept some responsibility for the energy crunch and suggested he was just looking to cast blame elsewhere. In a sharp exchange with the governor, Sen. Fred Thompson, R-Tennessee, asked whether Davis accepted "any responsibility" for the power woes in his state.

"For Gov. Davis, the answer is simple," Thompson said. "A bunch of Texas cowboys got down in the corral and decided they were going to take advantage of helpless California, and we are seeing the results of it."

IN DEPTH California's power crisis     ALSO Democratic Senators back off calls for price cap legislation

Davis is under increasing political pressure at home and faces re-election next year. He said if others want to accuse him of playing politics, so be it -- it has prompted action from Washington.

"If it weren't for a good deal of what you might consider political hyperbole, we might not have gotten the attention of the FERC, which stiffed us for almost a year," Davis said.

FERC chairman Curt Hebert Jr. disputed Davis' characterization of the commission's actions.

"There should be no doubt that this committee is actively pursuing refunds and other appropriate remedies for past behavior," Hebert said. "The commission is not ducking these issues."

Davis said California is "doing its part" by building more power plants and conserving energy. He said it was unreasonable to suggest the price increases could simply be passed on to California residents.

"If I passed on a 700 percent [rate] increase to the citizens of California, there would be an outrage -- the likes that you have never seen," Davis said.

Davis has called for caps on wholesale electricity prices, which have skyrocketed in the past three years. The FERC decision Monday was meant to ease wholesale electricity price spikes, but the Bush administration has consistently opposed price controls.

Some Senate Democrats had joined Davis in his call for price caps but have backed off since Monday's decision. California Sen. Dianne Feinstein welcomed FERC's new rule as a "giant step forward."

Feinstein said she asked Energy Committee Chairman Jeff Bingaman, D-New Mexico, to stop committee consideration of a bill she had sponsored that would call on FERC to impose price caps.

"I'm prepared to see how this works," Feinstein said. But both she and Majority Leader Tom Daschle said they could re-consider legislation later.