ERMUSR Misc Issues 05-10-2005 - Laserfiche WebLink

Home Browse Search

WEDNESDAY, APRIL 13, 2005 D13 California's Electricity Planners Hope They're Ready for Summer By REBECCA SMITH California officials are preparing for tight electricity supplies this summer, de- spite improvements that include several new power plants and the elimination of a major power-line bottleneck. If summer temperatures are normal, no problem is expected. But if it's unusu- ally hot, the organization responsible for electric-system reliability says there could be power shortages in Southern Cal- ifornia that will require special interven- tion, including pleas to cut usage. In 2004, a strong economy created record electricity demand on seven occasions, but there were no electricity disruptions. No matter how hot it gets this year, there won't be a repeat of 2000-O1, when tight supplies and market manipulation spawned runaway prices and rolling blackouts. Since 2001, California has shifted most of its buying out of the spot market and into long-term contracts. The state is also protected by a federally man- dated electricity price cap of $250 a mega- watt hour in the spot market. Tight conditions this year are being blamed on strong economic growth and a lack of hydropower available for import from the Pacific Northwest, where the snowpack as of April l was only 64% of normal. "We're not swimming in megawatts but we're not looking at blackouts," said Stephanie McCorkle, spokeswoman for the California Independent System Operator, based in Folsom, Calif. The organization is conducting a test on April 26 to make sure it can deliver all the power that's under contract for summer. Statewide demand this year is growing at a 3.7% pace. Prices for hydroelectricity from fed- eral dams have been high-$50 to $60 a megawatt hour this month, compared with as little as $10 in past years. This is the sixth year of low water for the Pacific Northwest, which traditionally helps Cali- fornia with electricity in the spring and summer and in return gets power from .California in the fall and winter. There has been unprecedented cooper- ation between California energy agen- cies this year to prepare the state. Joe Desmond, Gov. Arnold Schwarzenegger's energy adviser, said the state has tried to plan for the worst but "you cannot plan to protect yourself against every possible contingency," such as a major forest fire knocking out a big power line in the mid- dle of a heat storm. By the summer of 2006, California's in- vestor-owned utilities will be required to obtain more than enough power to meet their customers' needs. Meanwhile, fund- ing for new power plants has declined. Calpine Corp. is expected to put two big new plants into service by the end of June, but supplies remain especially tight in the southern part of the state, where fewer new plants have been constructed. "Power-plant retirements are also a concern," Mr. Desmond said at a Califor- nia Assembly legislative hearing Mon- day, noting that 5,000 to 9,000 megawatts of capacity may be retired in the next few years.