Freeman Expected to Lead Agency

SACRAMENTO —  S. David Freeman, the former head of the Los Angeles Department of Water and Power, will be named by the governor to chair a new state power agency created in the midst of California’s energy crisis, sources said Friday.

The choice of Freeman, 75, has been rumored for months. A spokesman for Gov. Gray Davis refused to comment on the selection Friday, saying only that an announcement will be made Monday.

But sources confirmed that Freeman will head the California Consumer Power and Conservation Financing Authority, a state agency to be created under a bill that takes effect Monday.

The agency will have the authority to raise as much as $5 billion through the sale of bonds to build power plants, encourage conservation and finance other projects.

Davis has called the new agency the “builder of last resort” and said that it will work to guarantee that California’s electricity supplies are always at least 15% greater than demand so that the state never again experiences the price spikes and blackouts.

Freeman could not be reached Friday, but in an interview last month he described his vision for the public power authority.

“Its job is to be sure that even when the prices are real low we keep conserving and building so that they stay low,” said Freeman. “Ten years from now, if we don’t put together what we are putting together, we’ll be back in the soup again.”

He also said the new agency must assure that California has sufficient supplies of natural gas--the fuel burned by most of the state’s power plants.

“Everybody’s talking about, well, we can’t just turn our back on electric power and let the market take care of us like we thought we could,” said Freeman last month. “I think if that’s a judgment, it’s got to include not turning our back on the natural gas supply.”

“We’re not going to be OK if we have a surplus of power plants in the future but get into a natural gas shortage,” he said.

Freeman has worked for half a century at some of the largest public power agencies in the nation, heading the Tennessee Valley Authority, the New York Power Authority and the Sacramento Municipal Utility District. He resigned in April as head of Los Angeles’ DWP to serve as Davis’ chief energy advisor. Last winter, he negotiated dozens of long-term power contracts for the state.

Some private energy firms that invested in California after the state moved to deregulate its electricity industry in 1996 are wary of the public power authority, as are many Republican lawmakers who say government has shown no ability to solve the state’s energy problems.

But environmentalists on Friday welcomed the choice of Freeman to head the new agency.

“He has shown commitment to renewable energy and hopefully would be a strong ally for the environmental community,” said Susan Stephenson, coordinator of a coalition of 36 nonprofit groups that sent a letter to Davis on Thursday urging him to appoint public power agency directors who are sensitive to environmental concerns.

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Times Sacramento Bureau Chief Virginia Ellis contributed to this story.