State retirement funds benefitting from power crisis

The Associated Press
Saturday April 28, 2001

OAKLAND — Dozens of state legislators, more than a million state workers – and even Gov. Gray Davis may be indirectly profiting from California’s power woes. Calpers, the state retirement and pension system, has more than a billion dollars invested in power generators. 

KTVU reports Calpers holds more than $250 million of Enron stock, almost $153 million of Duke Energy, $90 million of El Paso Energy and $62 million in Reliant Energy. 

The governor and other lawmakers have threatened to investigate power producers for gouging California consumers. Many energy producers have been reporting record profits during the power crisis. Jim Knox, of California Common Cause, said Calpers should look at divesting its stock if the companies are profiting at the expense of California consumers. 

“I assume their Enron and Reliant stock has done quite well in the last couple of years, but it has done well at the expense of California consumers,” he said. 

But Pat Macht, a Calpers spokeswoman, says if Calpers were to divest of every stock that had a critic, it would be impossible to manage. 

Sen. Don Perata, D-Oakland, agreed with Macht. 

“We have been through this before – and it is a very complicated thing,” he said. “But for us to divest of all the energy stocks, I mean, we would be using candles.” 

In the past, Calpers has divested from South African and tobacco stocks. 

Macht said the decision was a purely financial one and that Calpers is so large it has investments in every sector – not just energy. 

It is important to point out that there is no direct conflict of interest for the governor or for any legislature, KTVU reports.