President Carter's plan to guard against monopolistic practices in the energy industry has at least three gaping holes in it, Federal Trade Commission Chairman Michael Pertschuk said yesterday.
Carter said in April that his administration will devise a system to provide "reliable data" on energy company reserves, production and finances. The system, he said, would make divestiture of the major oil companies unnecessary and would insure competition among them.
But Pertschuk told Sen. Edward M. Kennedy's (D-Mass.) Judiciary Antitrust and Monopoly Subcommittee that the plan under consideration by the Federal Energy Administration would release the energy data it gathers only in "aggregate" form, not company by company.
The inability to examine individual company records, Pertschuk said, would make it difficult for the FTC and antitrust enforcement agencies to determine whether the companies engage in anti-competitive practices.
Pertschuk also testified that the current FEA proposal would not distinguish between the information it collects, such as refining operations as opposed to marketing operations. The failure to break that information down, he said, would make it difficult to analyse whether oil companies should be required to divest themselves of the various phases of operations they now control - producing, refining, distributing and marketing.
In his third criticism Pertschuk expressed concern that the information system would be limited to petroleum and not all energy, companies. Peabody Coal Co., he noted, is the nation's largest coal producer, but it would be exempt from the system cause it does not have petroleum interests.
"An energy data-collection system which does not reach such important energy companies," Pertschuk said, "would be of limited value to the FTC and I suspect, to other energy data users."
Federal Energy Administrator John F. O'Leary, told the subcommittee that, because the information system in only in the planning stages, he can't yet say what specific types of data will be included. But he emphasized that his agency will be working closely in devising the plan with the FTC and the Antitrust Division of the Justice Department.
Kennedy said he was concerned that the information FEA collects will not be shared with the antitrust enforcement agencies.
"There seems to be a logical contradiction here," Kennedy said. "On one hand the keystone of the President's energy competition policy is a better data system, but on the other hand, the data cannot be used by the agencies responsible for competition policy."
Despite sharp questioning from Kennedy, O'Leary refused to say how much, if any, information would be turned over to the FTC or the Justice Department. He said he was concerned about releasing "proprietary" information.
Cameron Graham, an assistant in O'Leary's office, said in a telephone interview later that the matter is still to be decided. But he added, "This agency tends to cooperate with other agencies."
John H. Shenefield, an assistant attorney general in the Justice Department's Antitrust Division, said the department has started a preliminary inquiry into possible anti-competitive practices in the international crude oil market. He said he expects the investigation to produce some "concrete" results in about a month.