By the OGJ Online Staff

HOUSTON, Aug. 6, 2001 — The departure of Curtis Hebert as chairman of the Federal Energy Regulatory Commission paves the way for President George W. Bush to name fellow Texas Patrick Wood III chairman.

Hebert, who became a lightning rod with congressional Democrat's and California Gov. Gray Davis over the agency's handling of the state power crisis, submitted his resignation to Bush Friday. It takes effect at the end of the month.

Hebert, a Republican from Mississippi and long time associate of Senate Republican leader Trent Lott, was rumored to be on his way out since Woods's FERC Senate confirmation hearing in May. But Hebert denied the speculation. His terms expires in 2004.

Bush named Hebert chairman of the federal agency that oversees wholesale electricity markets and interstate natural gas transportation in January. At the time, Hebert was the only Republican on the five-member commission because of two vacancies.

A staunch free market advocate, Hebert defended electricity deregulation and opposed FERC's imposing price controls in California even though critics claimed the western electricity markets were not working.

In his resignation statement Monday, Hebert called attention to his belief a market approach is the "key to future consumer benefits realized through incentives for the industry to provide the best possible service in a free market environment.

"I came to this job a strong advocate of free markets, and, if anything my time on the commission has only strengthened this believe. We need to get the rules right, but it is free enterprise that will put more and more consumers in the winners' circle."

Davis and California's two Democratic, Dianne Feinstein and Barbara Boxer, harshly criticized FERC and blamed Hebert for the agency's failure to curtail power prices in the West and for its refusal to order billions of dollars in refunds for high-priced power in California.

Hebert argued price controls would inhibit power plant construction and he testified before congressional committees FERC has aggressively pursued refunds when evidence of price gouging has been found. In June, after Wood and another Bush nominee, Nora Brownell of Pennsylvania, joined the commission, FERC ordered price caps on electricity throughout the West.

Bush is expected to appoint Wood as the commission's new chairman. Bush nominated Wood, who had been chairman of the Texas Public Utility Commission since 1995, to the FERC earlier this year. Wood has been quick to say deregulation in Texas will not proceed down the same path as California's.

Hebert, who was named to the commission in 1997, did not announce his future plans. With his departure, the commission will have two Republicans, two Democrats, and a vacancy. No more than three commissioners may belong to the same political party. One member is designated chair by the President.