|
|
Enron Mail |
Please see the attached articles:
Sac Bee, Mon, 4/16: "Tough talk on energy: Many Democratic lawmakers push to seize generators" Sac Bee, Mon, 4/16: "Dan Walters" Sac Bee, Mon, 4/16: "Up the creek without power" SD Union, Sun, 4/15: "SDG&E has rebates for conservers of energy" SD Union, Sun, 4/15: "State energy officials push for San Jose power plant= " SD Union (AP), Sun, 4/15: "PG&E sent hard-nosed proposal to Davis demanding no regulation" SD Union, Sat, 4/14: "Some plants can, but won't, make power" SD Union, Sat, 4/14: "FERC orders release of energy contracts" SD Union, Sat, 4/14: "Escondido, San Marcos may be power partners" SD Union (AP), Sat, 4/14: "Davis promises energy crisis won't cost voters= =20 'one penny' " LA Times, Mon, 4/16: "Utilities to Resume Paying Producers" LA Times, Mon, 4/16: "Tariff May Limit Flow of Natural Gas" LA Times, Sun, 4/15: "Experts Doubtful About Rush to Build Small Power=20 Plants" LA Times, Sat, 4/14: "Davis Says All Power Costs to Be Recovered" LA Times, Mon, 4/16: "Long, Hot, Costly Days" (Commentary) SF Chron, Mon, 4/16: "Passing Along the Cost=20 Many Bay Area businesses resort to surcharges to survive " SF Chron, Mon, 4/16: "Time Seems Bright for Solar Power=20 Big companies bring financial clout to field" SF Chron (AP), Mon, 4/16: "Developments in California's energy crisis"=20 SF Chron, Mon, 4/16: "Plan to Save Edison Faces Skepticism in Sacramento= =20 No legislative clamor for Davis' bailout deal"=20 SF Chron, Sun, 4/15: "NEWS ANALYSIS=20 Bush Administration Faces Static on Energy Policy=20 Environmentalists criticize calls for more drilling" SF Chron, Sun, 4/15: "Bay Theaters Start Bracing for More Blackouts=20 Larger venues buy generators" SF Chron, Sun, 4/15: "PG&E Took Hard Line, Dooming State Talks=20 Secret plan shows utility demanded less regulation" SF Chron, Sat, 4/14: "Energy Efficiency Rules Scaled Back=20 Bush official's move affects appliances" SF Chron, Sun, 4/15: "Power of Micro Vs. Macro=20 Some firms crushed by energy crisis" Mercury News (AP), Mon, 4/16: "PG&E sent hard-nosed proposal to Davis=20 demanding no regulation" Mercury News, Mon, 4/16: "Conservation drive fuels move to 'Cool Roofs' " OC Register, Mon, 4/16: "PUC president outlines the crisis" =20 (Commentary) Individual.com (AP), Mon, 4/16: "Sierra Pacific to suspend quarterly=20 dividend=20 --Sierra Pacific cites energy crisis uncertainty" Energy Insighty, Mon, 4/16: "Low storage levels mean strong refill season" ---------------------------------------------------------------------------= --- ------------------------------------------------- Tough talk on energy: Many Democratic lawmakers push to seize generators. By Jim Sanders BEE CAPITOL BUREAU (Published April 16, 2001)=20 Here's what some California lawmakers see as a trump card in solving the=20 state's energy crisis: Gouge the public, lose your power plant.=20 Faced with growing bills and dwindling options, many Democratic lawmakers a= re=20 pushing for the use of emergency powers or eminent domain to force power=20 generators to negotiate lower wholesale electricity prices.=20 "Step One is to seize a few power plants," said Senate President Pro Tem Jo= hn=20 Burton, D-San Francisco. "That would let (the generators) know we mean=20 business."=20 "There's no negotiation when generators say, 'Pay us what we want, or we'll= =20 shut off California's lights,' " said Phil Angelides, state treasurer. "We= =20 ought to levy an excess profit tax, and if they don't take their foot off o= ur=20 throat, seize a plant or two to sober them up."=20 The increasingly tough talk about seizing assets, while motivated by an=20 immediate desire to extract concessions, fits into a longer-term push for= =20 California to produce some of its own electricity to boost supply and prote= ct=20 against spiraling prices.=20 Critics blast the notion of seizure, however, as a bargaining ploy or=20 political grandstanding.=20 "It's actually quite silly and a waste of time to consider these options,"= =20 said Gary Ackerman, executive director of the Western Power Trading Forum, = an=20 association of wholesale generators.=20 "Seizure would mean the state would pay top dollar for an Edsel -- old, tir= ed=20 plants that are past their prime," he said. "What happens if these people a= re=20 wrong and they're taking the people of California down a dead end?"=20 But others say the time is ripe for radical reform, with the state paying u= p=20 to $50 million a day for electricity and facing prospects of rolling power= =20 blackouts this summer.=20 "The generators will only respond when we take their golden eggs: the plant= s=20 they own," said Douglas Heller of the Foundation for Taxpayer and Consumer= =20 Rights. "They're the ones cheating us, and they're the ones we must target.= "=20 Lawmakers have raised the following two seizure possibilities, each aimed a= t=20 ensuring that more electricity is available at lower than spot-market price= s:=20 Take over private power plants, perhaps contract with utilities to run them= =20 and let the courts decide what fair market price should be paid to the=20 companies that now own them.=20 Leave the plants alone, but seize their contracts with marketers, thus=20 controlling where the power is sold while reducing price markups by=20 eliminating the middleman in spot-market transactions.=20 State Sen. Debra Bowen, D-Marina Del Rey, chairwoman of the state Senate's= =20 Energy Committee, recently suggested a third way for California to acquire= =20 existing electricity assets, without seizing them: Purchase the entire=20 Pacific Gas and Electric Co. in Bankruptcy Court.=20 Such a move could benefit the state and keep PG&E property out of the hands= =20 of private companies that already have too much influence over the=20 electricity market, Bowen said.=20 All sides agree that takeovers would be an extraordinary, unprecedented=20 intervention into California's electricity industry.=20 But Burton said his support for seizures is "very serious." The state could= =20 pay acquisition costs through revenue from electricity sales, he said.=20 "People make money on power plants," he said. "It ain't like they're loss= =20 leaders."=20 Gov. Gray Davis hasn't ruled out the seizure of power generators' assets or= =20 the acquisition of PG&E. But such possibilities raise a million questions,= =20 ranging from taxpayer exposure to technical issues regarding use of any ass= et=20 acquired, Davis spokesman Steve Maviglio said.=20 Seizure, in particular, can be a "risky gamble" that should not be done in= =20 haste, Maviglio said. Private companies targeted by the state could respond= =20 by withholding power or deciding not to invest in new plants at a time when= =20 California is scrambling for more electricity.=20 "Clearly, the governor doesn't want to send a message that California doesn= 't=20 want increased generation," Maviglio said. "Even though generators are=20 gouging us now, they're also the people that build plants."=20 While the Democratic governor has not committed himself to seizure, he=20 supports legislation -- SB 6x -- written by Burton and supported by Angelid= es=20 that would create a public power authority to construct state-owned plants= =20 and help finance conservation and renewable-energy projects.=20 "The notion that we should let electricity be traded by profiteers like a= =20 sheer commodity is ludicrous and dangerous," Angelides said. "Public power = is=20 the public's defense against the greed and dysfunction of a market run amok= ."=20 Power plants aren't cheap, but with the $5.2 billion it has spent or=20 allocated since January to buy energy on the spot market, the state could= =20 generate enough electricity to serve more than 10 million homes. A=20 1,000-megawatt plant burning natural gas would cost about $500 million,=20 according to the California Energy Commission.=20 "We ought never again be in the position of having no ability to control at= =20 least part of the supply and hedge the market," said Darrell Steinberg,=20 D-Sacramento, a member of the Assembly's Energy Committee.=20 S. David Freeman, general manager of the Los Angeles Department of Water an= d=20 Power and an adviser to Davis, said he solidly supports building public=20 plants. He likes the idea of a windfall profits tax but is less enthusiasti= c=20 about asset seizures.=20 "All those things are worth considering and they're part of a common theme:= =20 The state has to take control of its own destiny," Freeman said. "We need t= o=20 conserve and build our way out of this mess. The Lord helps those who help= =20 themselves."=20 But Republican legislators, who have long opposed Davis' efforts to buy=20 statewide electricity transmission, think the state would be making a big= =20 mistake by seizing private plants or building its own.=20 "There's no reason to believe the state of California can run the power=20 business or the transmission business as good as, or better than, the priva= te=20 sector," said Assembly Republican leader Dave Cox of Fair Oaks.=20 The concept of seizure is particularly controversial.=20 "How far can you take this?" Cox asked. "If we have a natural gas shortage,= =20 do we then seize those pipelines?"=20 Jan Smutny-Jones of the Independent Energy Producers Association said state= =20 officials need to stop their "constant haranguing of generators."=20 "Seizing private property didn't work in Cuba, and I don't think it would= =20 work in California," he said.=20 Private electricity companies are investing billions to generate more power= ,=20 and are running their plants as hard as possible to meet the crisis,=20 Smutny-Jones said.=20 Soaring electricity prices have been due largely to high demand, scarce=20 supply, extremely high costs for natural gas to run turbines, and financial= =20 risks tied to the instability of PG&E and Southern California Edison,=20 industry officials say.=20 But state officials claim that market manipulation has contributed as well.= =20 The California Independent System Operator, which manages the statewide=20 transmission grid, has accused power generators of overcharging Californian= s=20 by $6.2 billion since May.=20 In response, the Federal Energy Regulatory Commission recently threatened t= o=20 order generators to refund a portion of the contested charges, $134.8=20 million, mostly covering state purchases in January and February.=20 Tom Williams, a spokesman for Duke Energy Corp., a North Carolina-based=20 company that operates four California power plants, said the company is=20 spending $1.6 billion to upgrade and expand those facilities in an attempt = to=20 ease the energy crunch.=20 State seizures would discourage investment and hurt the industry, Williams= =20 said.=20 "The governor has said that two things need to happen: The state needs more= =20 supply and lower prices," he said. "Seizing power plants would do nothing t= o=20 help those two objectives."=20 Any attempt to take Duke's property through eminent domain would spark a=20 lawsuit, Williams said. "We would fight it vigorously, I can assure you, to= =20 ensure we got fair market value."=20 But Duke would not object to the state building power plants of its own, he= =20 said.=20 "We support any effort, public or private, to add generation to California,= "=20 he said. "The state needs it -- and needs it fast."=20 The Bee's Jim Sanders can be reached at (916) 326-5538 or jsanders@sacbee.c= om .=20 ---------------------------------------------------------------------------= --- ---------------------------------------------------------------- Dan Walters (Published April 16, 2001)=20 Gray Davis is, by his own description, a cautious, incremental and=20 consensus-oriented politician. One might expect, therefore, that he would b= e=20 circumspect in what he says, as well as what he does.=20 The state's energy crisis, however, is offering new evidence of Davis' odd,= =20 even inexplicable, penchant for saying things that don't square with either= =20 reality or sensibility. It's not the same as President Bush's malapropisms.= =20 Davis knows what he's saying; he just doesn't know, or doesn't care, how=20 ludicrous his words strike others.=20 Take, for example, something Davis said three years ago as he was announcin= g=20 his candidacy for governor. In a feeble attempt to be inspiring -- not easy= =20 for a politician whose name captures his personality -- Davis quoted from a= n=20 inscription engraved into a state office building.=20 The inscription is "Bring me men to match my mountains," but Davis changed = it=20 to "Bring me people to match my mountains" as a gesture to feminists, and= =20 then placed it on the wrong building. To Davis, being politically correct w= as=20 more important than being accurate.=20 Davis had been governor for just six months when he uttered something so=20 outrageous that it continues to reverberate. In a meeting with newspaper=20 editors in San Francisco, Davis castigated the Legislature, which is=20 controlled by his fellow Democrats, as having "a totally different view of= =20 the world than I do, totally different," and then added: "People expect=20 government to reflect the vision that I suggested. Nobody else in the=20 Legislature ran statewide. Their job is to implement my vision. That is the= ir=20 job."=20 To put it mildly, legislators were miffed by this pungent whiff of=20 megalomania, which also disregarded American concepts of government, and=20 Davis had to do some serious fence-mending in subsequent weeks. But did he= =20 learn his lesson about saying things that implied he is the center of the= =20 political universe? Apparently not.=20 Nine months later, Davis said much the same thing about the courts, telling= =20 reporters in Washington that he expects his appointees to the bench to foll= ow=20 his lead on the death penalty and other issues or resign. Davis said that= =20 "while they (judges) have to follow the law =01( they're there because I=20 appointed them and they need to keep faith with my electoral mandate."=20 Another round of explanations and clarifications followed.=20 The governor has uttered so many odd, and ultimately unrealistic, statement= s=20 about the energy crisis this year that a Republican group now collects and= =20 distributes them. In January, he pledged that "there will be no rate=20 increases," even though he and a state Public Utilities Commission controll= ed=20 by his appointees now say hefty rate boosts are necessary. Repeatedly, he h= as=20 declared that an end to the crisis was in sight, only to see the state=20 plummet even further into the abyss. His promise of a short-term state powe= r=20 purchase program has now become an immense and prolonged drain on the state= =20 treasury. And projections of significant new power generation and=20 conservation savings to get the state through the summer are being downgrad= ed=20 severely.=20 During one particularly effusive period in late February, Davis said=20 California is "on the back side of the crisis," pledged that "the combinati= on=20 of rapid efforts to put more megawatts on line and conservation will get us= =20 through the summer," and declared that the state is within a month of=20 completing all the "legislative fixes" needed to settle the crisis.=20 But perhaps Davis' most enduring February declaration was this one: "Believ= e=20 me, if I wanted to raise rates, I could have solved this problem in 20=20 minutes." Maybe that was true in February. But Davis continued to dither an= d=20 the rates are being raised now without any indication that the crisis will = go=20 away anytime soon. Given his record, we should view all of Davis'=20 pronouncements with a strong sense of skepticism.=20 The Bee's Dan Walters can be reached at (916) 321-1195 or dwalters@sacbee.c= om .=20 ---------------------------------------------------------------------------= --- --------------------------------------------------------- Up the creek without power By Kevin Yamamura BEE CAPITOL BUREAU (Published April 16, 2001)=20 Assemblyman Dennis Cardoza was headed to a federal energy hearing in Boise,= =20 Idaho, on Tuesday to help save California from rolling power blackouts.=20 But hours before the scheduled departure came an unexpected twist: a blacko= ut=20 of his own.=20 Cardoza, a Merced Democrat, resides on a 36-foot Gulf Star watercraft=20 anchored along the Sacramento River during the week.=20 He and other lawmakers had planned to take a 5:30 a.m. chartered flight to= =20 Boise, which meant Cardoza had to rise by 4 a.m., said staff member Doug=20 White. Sometime during the night, however, the juice cut out.=20 While Cardoza woke up on time -- thanks to a battery-powered alarm clock --= =20 he faced other problems. "He had to take a really, really cold bath with=20 bottled water," White said.=20 In the end, Cardoza barely made the flight -- arriving at the airport just= =20 before the plane departed.=20 White said Cardoza's boat, powered by a series of batteries like those foun= d=20 in cars, fell victim to vandalism.=20 $%&#@@&%$ timecards!!!=20 Tensions apparently remain high at the Office of Criminal Justice Planning= =20 between some employees and their bosses.=20 So high, in fact, that members of the California State Employees Associatio= n=20 distributed leaflets Tuesday in front of the agency's office on the K Stree= t=20 Mall, criticizing management for what they consider to be high turnover rat= es=20 and failed leadership.=20 Some are particularly incensed about a new computer timekeeping system that= =20 tracks when they leave and where they go. Union President Perry Kenny said= =20 the system treats workers like "inmates."=20 OCJP Chief Deputy Director Allen Sawyer said it is a response to a state=20 audit issued two years ago that showed the agency lacked accountability for= =20 workers' time. He added that he feels managers have a "great relationship"= =20 with staff.=20 An arbitrator is scheduled to review the matter in mid-June.=20 The latest dispute follows criticism in December of OCJP Director Frank=20 Grimes for allegedly using profanity in a mandatory meeting with staff.=20 Grimes denied the claim, calling it a "false allegation."=20 Bigger than a bowl game The 1951 University of San Francisco football squad won nine games, lost no= ne=20 and is considered by many to be among the greatest college teams in history= .=20 But the Dons were snubbed by bowl game organizers because the team fielded= =20 two African American players. They stayed home while squads with blemished= =20 records -- including those they had beaten -- moved on to the postseason.= =20 To mark the team's 50th anniversary this fall, Sen. Barbara Boxer, D-Calif.= ,=20 has asked President Bush to honor the squad by inviting members to a White= =20 House ceremony. In particular, Boxer noted the team's integrity.=20 "The team was offered the chance to compete without the African American=20 players, but they unanimously refused on principle," she wrote.=20 Jeff Logan, a Boxer spokesman, said the senator has not yet received a=20 response from the president but expects to hear soon.=20 ---------------------------------------------------------------------------= --- ----------------------------------------------------------- SDG&E has rebates for conservers of energy=20 By Karen Kucher=20 UNION-TRIBUNE STAFF WRITER=20 April 15, 2001=20 Doris Tuley of El Cajon no longer switches on her TV during the day. She=20 turns on so few lights she has to squint to read, and does her laundry only= =20 at night.=20 "We are cutting back -- and yet the bill keeps going up," she said.=20 Last week, Tuley, 63, found another way to save. She took six halogen=20 torchiere lamps to La Mesa's Porter Hall to exchange for fluorescent lamps,= =20 which use less electricity.=20 The replacements were free, provided by San Diego Gas & Electric Co. under = an=20 outreach program for seniors.=20 It is one of many rebates and incentives offered by the utility, which is= =20 spending about $50 million to encourage residents and businesses to conserv= e=20 energy.=20 In the market for a new refrigerator? Consumers who purchase energy-saving= =20 models can pocket up to $125. Buying the right dishwasher could get you a $= 50=20 rebate, while $75 is available for those who purchase qualified clothes=20 washers.=20 SDG&E also offers rebates for homeowners who install insulation,=20 energy-efficient windows, new gas water heaters or energy-saving swimming= =20 pool pumps. Apartment building owners can get incentives to retrofit=20 appliances in units, and developers who build homes that don't waste power= =20 can get money, too.=20 The utility has offered programs promoting efficiency and conservation sinc= e=20 the 1970s, with rebates and other costs covered by ratepayer fees, said Yol= e=20 Whiting, SDG&E's director of consumer programs and services.=20 Surge in interest Such incentives have gained new importance in recent months, as skyrocketin= g=20 prices and blackouts have become a reality for Californians.=20 Consumers have been flooding the utility's Web site (http://www.sdge.com) a= nd=20 phone lines to find more information.=20 "In the past, I can remember when it was hard to convince folks that they= =20 needed to save energy," Whiting said. "We are getting a lot of response and= a=20 lot of interest now."=20 SDG&E is trying to encourage its customers to reduce total demand by 75=20 megawatt-hours or more during 2001.=20 If it creates a 23 megawatt-hour reduction and meets other goals, it will= =20 receive a $2.7 million incentive payment from the state Public Utilities=20 Commission, Whiting said.=20 The 23 megawatt-hours are enough to meet the demands of 17,250 households.= =20 Managers of stores that sell appliances say they have seen a rise in=20 refrigerator sales in the first quarter of the year, which they believe is= =20 related to California's energy crisis.=20 Consumers are particularly interested in finding appliances carrying the=20 Energy Star label of the U.S. Department of Energy and U.S. Environmental= =20 Protection Agency because those appliances save the most energy and qualify= =20 for rebates.=20 "A lot of people don't understand Energy Star, but they do understand energ= y=20 efficiency," said Harry Overlock, who manages the Sears store in El Cajon.= =20 Energy expert Michael Lamb said a 10-year-old refrigerator may use twice as= =20 much power as a new model.=20 "Modern refrigerator technology has come a long way in 10 years," said Lamb= ,=20 a certified energy manager at Energy Efficiency and Renewable Energy=20 Clearinghouse, a program operated by the U.S. Department of Energy.=20 "As a general rule of thumb, a modern refrigerator of the same size with=20 similar features will use about half the amount of power as one made about = 10=20 years ago, and about a third of the power of one made about 15 years ago.= =20 "The technology has just gotten a whole lot better," he said.=20 Lamb said newer models offer better compressor motors and evaporation fan= =20 motors, more intelligent controls and better insulation.=20 Shop carefully Although those models can be more expensive, consumers like them because th= e=20 rebate defrays some of the initial cost and because the long-term energy=20 savings are attractive.=20 However, a representative from the Utility Consumers' Action Network=20 public-interest group warned consumers to research rebates before they shop= =20 for appliances.=20 A UCAN intern who recently went to several local stores found that many=20 salespeople seemed unfamiliar with rebate programs and didn't know what=20 models qualified for them, said Jodi Beebe, an energy analyst with UCAN.=20 "The best thing to do is do it with foresight," Beebe said.=20 Sears' Overlock said he thinks rebates encourage consumers to replace=20 inefficient appliances -- and he'd like to see more offered.=20 Bill Walker, manager of the Home Depot in Grantville, says his customers ar= e=20 buying everything in the store related to energy efficiency.=20 "Ever since the gas and electric bills have gone nuts, we are seeing a ton = of=20 energy-saving items from across the board (being bought). We can't keep=20 insulation on the shelves," Walker said.=20 "The energy-saving light bulbs are through the ceiling. We are up over 500= =20 percent on energy-saving light bulbs," he said. "People are buying like 20 = at=20 a time and changing out their whole house."=20 The Home Depot sales aren't unusual.=20 SDG&E says regional sales of energy-efficient light bulbs, which are=20 subsidized by the utility company, exceeded projections for the first three= =20 months of the year. Funds for several rebates also are being drawn down=20 quickly, although Whiting said there is no immediate danger of the utility= =20 ending any of the programs.=20 "I would love to run out of money this year," she said. "We are doing=20 everything we can to get these funds into the hands of consumers."=20 ---------------------------------------------------------------------------= --- ----------------------------------------------- State energy officials push for San Jose power plant=20 ASSOCIATED PRESS=20 April 15, 2001=20 SAN JOSE =01) In an effort to ease this summer's promised power drain, stat= e=20 energy officials are pushing for approval of a proposed power plant in San= =20 Jose's Coyote Valley, despite recommendations that other sites may be more= =20 environmentally suitable, a newspaper reported Sunday.=20 California Energy Commission top administrators undermined a negative=20 environmental assessment of the project and recommended approval of Calpine= =20 Corp.'s Metcalf Energy Center over other sites, the San Jose Mercury News= =20 found, citing internal documents and transcripts obtained through a=20 California Public Records Act request.=20 But commission deputy director Bob Therkelsen denied any impartial dealings= =20 concerning the plant.=20 "I would not deny that some of the staff have strong feelings," Therkelsen= =20 said . "But I think the process allowed all perspectives to be heard."=20 San Jose City Council opposes the project because the city had planned to= =20 save the property for high-tech campuses.=20 Commission administrators and attorneys directed an analyst to downplay oth= er=20 sites' advantages and quieted him at a hearing when he tried to voice his= =20 concerns over the pressure that prompted him to alter his findings, the=20 newspaper found. The commission also reversed a third analyst's=20 recommendation that Calpine obtain a contract for recycled water prior to= =20 construction, which could have slowed building the plant.=20 A 574-page Preliminary Staff Assessment released in May identified other mo= re=20 "environmentally preferable" sites, including two industrial sites in=20 Fremont.=20 Therkelsen said the report was a premature draft that changed as more=20 information became available.=20 "I was concerned that the alternatives were being portrayed more=20 optimistically than realistically," Therkelsen said.=20 Analyst Gary Walker, a 21-year veteran, reported other plant sites would be= =20 more suitable, but was later told his report was full of "bias" and=20 "inconsistencies," the newspaper reported.=20 In an e-mail, senior commission attorney Arlene Ichien said Metcalf must be= =20 cast in a better light or it would be hard for the commission to grant=20 approval.=20 "Staff is building a strong case for finding the alternative sites feasible= ,"=20 Ichien wrote.=20 In a report last fall, Walker's discussion of other sites' advantages was= =20 ultimately replaced by a warning that the Silicon Valley is at risk for=20 blackouts unless Metcalf is built.=20 The final report recommended approval.=20 Another analyst was told to change his report about how much noise the plan= t=20 would create and the amount of insulation needed to quiet it, the newspaper= =20 reported. The analyst was taken off the project, and the final assessment= =20 released last October said insulation was not necessary because of the few= =20 homes near the plant.=20 The five-member commission is expected to make its decision this summer=20 during the power crisis' peak load. There is a push to build power plants i= n=20 the technology-dominated Silicon Valley, which imports most of its=20 electricity. The plant would use 3 million to 6 million gallons of water a= =20 day, but with San Jose officials opposed to the plant, it is unclear where= =20 that water would come from.=20 Calpine and its development partner, Bechtel Enterprises, wants the plant= =20 operating by 2002.=20 ---------------------------------------------------------------------------= --- -------------------------------------------- PG&E sent hard-nosed proposal to Davis demanding no regulation=20 ASSOCIATED PRESS=20 April 15, 2001=20 SAN FRANCISCO =01) Pacific Gas and Electric Co. officials demanded the util= ity=20 be cut free from state regulation and be allowed to push huge rate increase= s=20 onto its customers, two weeks before negotiations with Gov. Gray Davis brok= e=20 off, the San Francisco Chronicle reported Sunday.=20 "Perhaps we misjudged their primary concern," said Steve Maviglio, the=20 governor's spokesman. "It wasn't resolving their credit issue. It was=20 extracting vengeance on the PUC."=20 In addition to insisting that it be released from the state Public Utilitie= s=20 Commission's regulatory grip, PG&E demanded it be allowed to buy back its= =20 power lines without competitive offers if the state ever decided to sell. I= n=20 addition, it wanted to continue profiting from any telecommunications lines= =20 or antennas linked to the system, according to a Feb. 28 eight-page proposa= l=20 obtained by the Chronicle.=20 PG&E denies the document influenced the outcome between the utility and the= =20 state.=20 "It is ludicrous to suggest that this document caused the negotiations to= =20 break down," said PG&E spokesman Ron Low. "There were negotiations that=20 occurred later and other documents that followed."=20 At the time of the utility's bankruptcy filing April 6, PG&E Corp. Chairman= =20 Robert Glynn said no talks had been held for three weeks. PG&E's proposal h= ad=20 been delivered about two before talks ceased.=20 PG&E has said it's entitled to recoup $9 billion it paid for wholesale powe= r=20 because of PUC-regulated rate caps, which kept the utility from passing hig= h=20 costs onto customers.=20 The proposal said this money "will be fully recovered in retail rates witho= ut=20 further CPUC review for prudence or any other purpose," the Chronicle=20 reported.=20 The document went on to demand the PUC drop all proceedings concerning PG&E= ,=20 including an investigation into whether the utility violated California law= =20 by transferring millions to parent company PG&E Corp. prior to filing=20 bankruptcy.=20 "They took a position on regulatory matters that was out of touch with=20 reality," Maviglio said.=20 PG&E Corp. spokesman Shawn Cooper declined to comment on the proposal.=20 "That document is confidential," he said.=20 Ratepayer advocates say they're baffled by PG&E's demands.=20 "It's like the Japanese insisting that we surrender Hawaii after we beat th= em=20 in World War II," said Harvey Rosenfield, consumer advocate for the=20 Foundation for Taxpayer and Consumer Rights.=20 ---------------------------------------------------------------------------= --- ----------------------------------------------- Some plants can, but won't, make power=20 Too costly to run, they sit off-line By Jonathan Heller=20 UNION-TRIBUNE STAFF WRITER=20 April 14, 2001=20 While San Diegans are being asked to turn off lights and wash dishes by han= d=20 because of the energy shortage, three power plants capable of supplying pow= er=20 for about 155,000 homes have sat idle for up to two weeks.=20 The cogeneration plant at the Iceoplex skating complex in Escondido has bee= n=20 off-line since April 1 because a state agency that regulates its prices has= =20 set them so low it can't afford to produce electricity, a plant official sa= id=20 yesterday.=20 Three other cogeneration plants at the North Island Naval Air Station, the= =20 Naval Training Center and the 32nd Street Naval Station also are off-line.= =20 Together, they can produce 155 megawatts, or about 5 percent of the county'= s=20 total demand at this time of year. A megawatt is enough energy to power 750= =20 to 1,000 homes, depending on the time of year and other factors.=20 Unlike conventional power generators, which can set their own prices under= =20 deregulation, cogeneration plants and other alternative power providers, su= ch=20 as wind and solar plants, sell power under a price formula set by the=20 California Public Utilities Commission.=20 The PUC changed the formula April 1, and since then cogenerators across the= =20 state have complained they can't recoup their costs under the new pricing= =20 system.=20 "Anyone who can do math can figure out that losing money is no incentive to= =20 generate power," said Ann MacLeod, executive director of the California=20 Cogeneration Council.=20 This situation is different from the one that led Houston-based Dynegy Corp= .=20 to threaten to shut down its San Diego-area plants this week. Dynegy said i= t=20 no longer wants to sell power because it is afraid the state is not able to= =20 pay the bill.=20 The Iceoplex plant, operated by Purenergy Corp., produces just under 50=20 megawatts, nearly enough to supply a city the size of Escondido. Jim=20 Hinrichs, Purenergy's general manager in San Diego, said he did not know ho= w=20 long it would be shut down.=20 "Our plant in Escondido is currently off-line until such time as we can=20 procure gas at a price where we can cover our fuel costs," Hinrichs said.= =20 The three plants on the Navy bases, operated by Sithe Energies Corp., produ= ce=20 between 23 and 45 megawatts each.=20 It was unclear why those plants were shut down. A spokesman for Sithe=20 Energies could not be reached for comment late yesterday.=20 The Naval Training Center plant went off-line April 2, the North Island pla= nt=20 on April 3 and the 32nd Street plant on April 6, according to the Independe= nt=20 System Operator, which manages the state's power grid.=20 Those outages were unplanned, according to the Independent System Operator= =20 Web site.=20 Stephanie McCorkle, an ISO spokeswoman, said she could not comment on why t= he=20 plants were shut down. She did say that about half of all alternative power= =20 generators, including cogenerators, wind and solar plants, are currently=20 off-line in the state. That translates to 3,000 megawatts, or enough energy= =20 for about 3 million homes.=20 The four San Diego cogeneration plants are under contract to sell electrici= ty=20 to SDG&E, which feeds it into the regional power grid.=20 "If they don't run, they don't get paid," said Art Larson, an SDG&E=20 spokesman. "That's one simple aspect of the contract."=20 There are other cogeneration plants in the county that are still operating,= =20 although most of them are much smaller than the four that are off-line.=20 "During this period of demand shortfalls, we think it's in the best interes= t=20 of the community that every available power generating source be up and=20 operating," Larson said.=20 James Loewen, a PUC analyst, acknowledged that the PUC's decision has=20 resulted in lower payments to the cogenerators. He said the pricing formula= =20 and payments to cogenerators are tied to the cost of natural gas imported= =20 into California.=20 The PUC changed the formula to one that would factor in gas coming in from= =20 the Oregon border, where prices are historically cheaper, he said.=20 But cogenerators contend the new formula has made it uneconomical to turn o= n=20 their plants.=20 "It defies common sense," said MacLeod of the cogeneration council. "We are= =20 hoping the PUC has become aware in the last month as how bad that decision= =20 was."=20 ---------------------------------------------------------------------------= --- --------------------------------------------------- FERC orders release of energy contracts=20 Regulators' demand for secret deals riles Davis administration By Toby Eckert? COPLEY NEWS SERVICE=20 April 14, 2001=20 WASHINGTON -- Federal regulators have ordered power suppliers to turn over= =20 copies of their confidential short-term and long-term contracts with=20 California, which the regulators intend to share with a congressional=20 committee.=20 In a letter sent to the power companies Thursday, the Federal Energy=20 Regulatory Commission said it would "treat these contracts as confidential"= =20 unless the supplier waives confidentiality.=20 It is unclear whether the House Government Reform Committee is under the sa= me=20 obligation, though FERC said the information would be given to the committe= e=20 "under confidential seal."=20 Gov. Gray Davis has been keeping details of the contracts secret, arguing= =20 that revealing the information would weaken the state's bargaining position= =20 in negotiations with other suppliers. FERC's order angered the Davis=20 administration, which fears the information will be leaked once it is in=20 federal hands.=20 "It just seems to me that FERC is trying to give generators more leverage,"= =20 said Davis spokesman Steve Maviglio. "The more information we release, the= =20 more Californians are going to have to pay."=20 FERC's letter to the 49 power suppliers came two days after Republican=20 congressmen threatened to issue subpoenas for the contracts at a U.S. House= =20 Government Reform Committee hearing in Sacramento on the power crisis.=20 "We want that information," Rep. Dan Burton, R-Ind., the committee chairman= ,=20 told California Public Utilities Commission President Loretta Lynch.=20 So do California news organizations -- including The San Diego Union-Tribun= e=20 -- and Republican state lawmakers, who have filed separate suits to get it.= =20 The California Department of Water Resources has been buying power on behal= f=20 of the state's cash-strapped utilities. FERC said it wanted to see the=20 contracts "to determine how successful efforts have been to fashion long-te= rm=20 contracts and to reduce reliance on spot markets," where electricity prices= =20 are typically higher.=20 FERC issued an order Dec. 15 designed to encourage long-term contracts and= =20 bring some stability to California's chaotic power market.=20 The letter to the power companies said FERC "intends to provide copies of t= he=20 contracts to the Committee on Government Reform under confidential seal."= =20 A FERC spokeswoman said she was unsure whether that meant the committee wou= ld=20 be obligated to keep the information secret. She referred the question to t= he=20 committee. A spokesman for the committee could not be reached for comment.= =20 FERC gave the power suppliers until the close of business Monday to file th= e=20 contract copies.=20 Meanwhile, for the second time this week, Energy Secretary Spencer Abraham= =20 defended the Bush administration's response to the California crisis. Criti= cs=20 have blistered the administration for refusing to consider price controls o= n=20 wholesale electricity.=20 In a letter to members of Congress and California legislators released by t= he=20 Energy Department on Friday, Abraham outlined 11 steps the administration a= nd=20 FERC have taken, such as ordering federal agencies to expedite permits for= =20 new power plants and asking power providers to do everything they can to=20 avoid disruptions this summer.=20 "Regrettably, our well-founded opposition to price caps has been claimed by= =20 some to suggest the administration either does not care about California an= d=20 the West or is doing nothing to address the problem," Abraham wrote.=20 Abraham made similar comments when briefing reporters Monday on the Energy= =20 Department's proposed budget for fiscal year 2002.=20 ---------------------------------------------------------------------------= --- ---------------------------------------------- Escondido, San Marcos may be power partners=20 Cities seeking way to forge rate deals By Jonathan Heller=20 UNION-TRIBUNE STAFF WRITER=20 April 14, 2001=20 ESCONDIDO -- After months of tiptoeing around the idea of working with San= =20 Marcos to buy cheap energy, the Escondido City Council might be ready to ge= t=20 serious.=20 On Wednesday, the council is expected to direct City Manager Rolf Gunnarson= =20 to initiate a formal working arrangement with San Marcos officials on a=20 project to seek inexpensive, stable energy rates.=20 "The time for talking is over," said City Councilwoman June Rady.=20 Rady approached San Marcos City Councilman Lee Thibadeau in January with th= e=20 idea of the two cities working together. That was before Sempra Energy=20 Resources made public its plans to build a 500-megawatt power plant in=20 Escondido.=20 Now Rady believes that the two cities can join forces and forge a deal with= =20 Sempra to nail down inexpensive electricity rates. Sempra officials have sa= id=20 they're willing to discuss possible rate deals with the city.=20 If the council votes to move forward with the cooperative plan, Gunnarson= =20 would take the lead with San Marcos City Manager Rick Gittings.=20 "I would propose to work closely with Mr. Gittings as well as the city=20 attorney's office, and with legal and technical consultants, to develop=20 policy options for the council to consider," Gunnarson wrote in a report to= =20 the council.=20 To buy power directly, instead of through a utility such as San Diego Gas &= =20 Electric, a city has to adopt a special legal arrangement, such as forming = a=20 municipal utility district. San Marcos has done that, but it would be a mor= e=20 lengthy process for Escondido. San Marcos is a charter city and has more=20 flexibility under the state Constitution. Escondido is a general law city.= =20 Escondido, however, might have the option of forming a joint-powers authori= ty=20 with San Marcos to buy power.=20 Gittings said in a letter to Escondido officials that he believes the Sempr= a=20 proposal is an excellent opportunity for both cities.=20 "The project may possibly alleviate the power requirements of our two citie= s=20 and provide a much-needed generating facility in the northeastern portion o= f=20 the county," Gittings said.=20 The Sempra plant would be built in Quail Hills in the southwestern part of= =20 Escondido, not far from the San Marcos boundary.=20 Sempra has had several meetings with Escondido officials and residents, but= =20 has not yet submitted a formal proposal.=20 ---------------------------------------------------------------------------= --- --------------------------------------------------- Davis promises energy crisis won't cost voters 'one penny'=20 ASSOCIATED PRESS=20 April 14, 2001=20 LOS ANGELES =01) Gov. Gray Davis promised that taxpayers will end up spendi= ng=20 "not one penny" on the energy crisis because struggling utilities will repa= y=20 billions of dollars the state treasury has spent to keep the lights on.=20 "We will not only be paid for all our expenses to date, we'll have enough .= ..=20 to continue buying power through this year and hopefully 2002," Davis told= =20 the Los Angeles Times on Friday.=20 But the governor also admitted California still faces possible blackouts th= is=20 summer, especially during hot spells when air conditioners will be running= =20 full blast.=20 Davis has asked state lawmakers to approve spending another $500 million to= =20 buy power for bankrupt Pacific Gas and Electric and credit-poor Southern=20 California Edison, bringing his total requests to $5.2 billion.=20 The governor, however, said he expected the state money to be repaid by ear= ly=20 2003 under his plan to float $12.4 billion in bonds. The bonds, to be issue= d=20 in June, would be repaid by utility ratepayers.=20 The governor's plan, which was approved by the Legislature, was adopted wit= h=20 hopes that the state could negotiate long-term contracts with power supplie= rs=20 and eventually stabilize prices. Those lower prices have yet to materialize= ,=20 and state Treasurer Phil Angelides has raised questions about the plan in= =20 recent weeks.=20 Davis also said he inherited the power crunch.=20 He was state controller in 1996 when the state Legislature was discussing= =20 utility deregulation but "I basically wasn't asked to take a position and I= =20 didn't take a position," Davis said. "I didn't give it much thought."=20 He also blamed the crunch on out-of-state wholesale electricity producers.= =20 They have gouged California utilities and are "the biggest snakes on the=20 planet Earth," the governor said.=20 But he reserved most of the blame for the Federal Energy Regulatory=20 Commission, calling it "the culprit" in the crisis. Davis said the commissi= on=20 has refused to cap wholesale prices, and as early as 1995 turned down state= =20 requests to build more power plants.=20 On Friday, California's power grid operator called on the federal commissio= n=20 to increase the amount of money it ordered electricity generators to refund= =20 last month. The California Independent System Operator has said power=20 generators have overcharged utilities billions of dollars more than the $12= 4=20 million in January and February power sales questioned by the Federal Energ= y=20 Regulatory Commission so far.=20 ---------------------------------------------------------------------------= --- --------------------------------------------------- Utilities to Resume Paying Producers=20 Electricity: Some small companies that provide power say the new rate plans= =20 are not enough to get them back online.=20 By JULIE TAMAKI, Times Staff Writer=20 ?????SACRAMENTO--The state's two biggest utilities are scheduled to resume= =20 paying hundreds of small power producers this week, but at least some=20 producers say they plan to remain offline. ?????Jay Henneberry, an attorney representing a small gas-fired power plant= =20 in Oxnard, said his client does not plan to start generating electricity=20 again for Southern California Edison today, because of a controversial new= =20 rate plan that he said would force his client to operate at a loss. ?????The company, EF Oxnard Inc., sued Edison last week, alleging that the= =20 utility owes it more than $13.5 million for past electricity deliveries. Th= e=20 lack of payment, according to EF Oxnard officials, prompted natural gas=20 suppliers to cut them off in February, forcing Oxnard to stop producing=20 electricity. ?????Henneberry noted that the new rate plan fails to address the utilities= '=20 past debt to producers, which who are collectively owed more than $1.8=20 billion. ?????"Those payments are only on a going-forward basis," Henneberry said.= =20 "They do nothing for $13.5 million owed to my client." ?????The situation underscores the problems the state faces as it tries to= =20 get California's nearly 700 producers of alternative and renewable energy= =20 paid and, in cases such as EF Oxnard, back in business. ?????These companies, which include producers of solar, wind and thermal=20 power, provide more than a quarter of the electricity consumed in Californi= a.=20 But their output has been cut by as much as half in recent weeks due in par= t=20 to the payment problems. ?????A new rate plan approved by the Public Utilities Commission last month= =20 to help get those producers paid has triggered a growing number of gas-fire= d=20 power producers to sue Pacific Gas & Electric and Edison to get out of thei= r=20 contracts with the utilities. The power suppliers say the new rate plan wou= ld=20 force them to operate at a loss, because it does not adequately compensate= =20 them for rising natural gas costs. ?????"We are not going to run our plants if we can't run them profitably,"= =20 said Marty Quinn, executive vice president and chief operating officer of= =20 Ridgewood Power LLC, which owns three small gas-fired generators in=20 California that are not operating. ?????In a related matter, a hearing is scheduled today in a legal battle=20 between Edison and a small geothermal producer. An Imperial County judge=20 previously freed CalEnergy from its contract with Edison because of the=20 utility's failure to pay the company, which has since been selling its=20 supplies on the wholesale power market. ?????The court is expected to rule today on CalEnergy's request for roughly= =20 $100 million in payments it is owed by Edison, and could also act on an=20 Edison request that Cal- Energy be required to resume selling power to the= =20 utility. ?????"If Edison shows that it is credit-worthy and capable of making paymen= ts=20 on a going-forward basis, I'm sure the judge will take that into account,"= =20 said CalEnergy official Jonathan Weisgall. "But one of our concerns is how= =20 long will Edison continue to make these payments." ?????An official with Sierra Pacific Industries, which received court=20 permission earlier this month to sell power generated by six plants it owns= =20 in California to a buyer other than PG&E, said Sierra Pacific does not plan= =20 to resume transmitting electricity to the utility. ?????"From our point of view we have terminated those contracts," said Bob= =20 Ellery, Sierra Pacific's director of energy resources. ?????Henneberry said he doubts that Edison plans to pay EF Oxnard because t= he=20 new rate arrangement covers only deliveries made in April and beyond. ?????An Edison spokesman said his company sent payments totaling $206 milli= on=20 to small producers Friday, but said he did not know whether checks were sen= t=20 to producers that have gone offline. A spokesman for PG&E estimates that th= e=20 monthly bill to small producers will total $200 million to $400 million. ?????Ridgewood, Oxnard and Sierra Pacific generate a total of 140 megawatts= =20 of electricity, or enough power to serve more than 105,000 typical homes.= =20 State officials have at times been forced to replace the lost deliveries by= =20 purchasing power on the pricey wholesale and spot markets. ?????The California Independent System Operator, which oversees the state's= =20 power grid, said it received about 3,800 megawatts of power Friday from sma= ll=20 producers, compared to the 6,000 megawatts the small producers usually=20 deliver. In recent weeks the group's output has dipped as low as 3,000=20 megawatts. ---------------------------------------------------------------------------= --- ---------------------------------------------------------------- Tariff May Limit Flow of Natural Gas=20 Power: A tax designed to protect the Gas Co. may be stifling efforts to shi= p=20 more of the fuel needed by many California generators.=20 By CHRISTINE HANLEY, Times Staff Writer=20 ?????Two projects aimed at boosting the capacity of California's natural ga= s=20 delivery network are stalled by a little-known tariff that power companies= =20 would have to pay to use the new pipelines. ?????The tax was established six years ago by the Public Utilities Commissi= on=20 and requires electricity generators and other natural gas customers to pay = an=20 extra fee if they use pipelines not controlled by Southern California Gas C= o. ?????At the time, officials as well as consumer advocates believed the tari= ff=20 would protect the firm's residential and small business owners. ?????But amid California's energy crisis, some officials contend that the= =20 tariff is preventing the state from boosting pipeline capacity at a time wh= en=20 more natural gas is desperately needed to fuel power plants. ?????California, which makes more than half its electricity from natural ga= s,=20 has not expanded its gas distribution network in eight years. Experts warn= =20 that the system is running close to capacity and that easing constraints is= a=20 crucial step in any rescue plan. ?????Two companies are trying to add capacity: Questar wants to convert an= =20 old oil pipeline that runs 700 miles underground from New Mexico to Long=20 Beach, and Williams Co. wants to push its existing Kern River-Mojave pipeli= ne=20 farther west, also to Long Beach. ?????But both companies said they are having trouble signing up customers= =20 because power companies don't want to pay the tariff. ?????Watson Cogeneration Co., which operates a 400-megawatt generator in Lo= s=20 Angeles County, is considering using Questar's pipelines but said it cannot= =20 complete any deal until the tariff issue is resolved. ?????"With the state building all these new gas-fired plants, the question = I=20 have is, where are they going to get the gas?" said Pat King, executive=20 director of the firm. ?????Questar, Williams Co. and other energy companies have been fighting th= e=20 tariff in a series of hearings before the PUC. Last year, the commission=20 concluded that the tariff may discourage the construction of badly needed n= ew=20 power plants in Southern California and asked the Gas Co. to develop a new= =20 pricing system. ?????But the issue was reassigned earlier this year to a new administrative= =20 law judge as the commission reshuffled its load to handle more pressing=20 energy emergencies. That judge does not expect a final ruling any time soon= . ?????"The case is in limbo," said Carol Brown, the judge, who must sift=20 through years of transcripts before writing a draft decision. She predicted= =20 that "we might all be old and gray" by the time a final vote is taken by th= e=20 full commission. ?????Enacted in 1995, the so-called Residual Load Service tariff can levy= =20 massive penalties against Gas Co. customers who choose an alternate=20 distributor but later have to return to the company's network. ?????If service on a competing pipeline is interrupted, a power plant that= =20 had to switch back to the Gas Co. for a day of deliveries could be charged= =20 what it would cost to reserve that capacity for an entire year. ?????For many power plants, the risk of leaving the Gas. Co. with the tarif= f=20 in place is simply too high. ?????"If there's any risk that that might happen, there's no way you're goi= ng=20 to sign up for another pipeline, because you'd end up paying twice for=20 natural gas service," said Tom Beach, a former PUC staffer and a consultant= =20 for Crossborder Energy who testified against the tariff. "It just shows how= =20 punitive this rate is and how it discourages people from bringing in new=20 pipelines and trying to compete with SoCal Gas." ?????Critics charge that the tariff is so punitive that not a single power= =20 supplier has left Southern California Gas. ?????The tariff was approved with ratepayers in mind--and actually was=20 heavily endorsed by consumer activists. Without it, they said, Southern=20 California Gas could pass on any loss in business from competing pipelines = to=20 its residential and other core customers. ?????Still, Pacific Gas & Electric Co., California's other top gas utility,= =20 has never requested such a tariff to protect its Northern California=20 territory from competitors. ?????But as PG&E itself points out, the market is more competitive in=20 Southern California, where four of the five major interstate pipelines=20 serving California cross the state border. ?????"We never felt we needed it," said Staci Homrig, a PG&E spokeswoman.= =20 "There's not the same competitive situation up here as there is down there.= " ?????The Gas Co. says the tariff is necessary to prevent power plants from= =20 shopping around for the best pipeline deal and then using the company's lin= es=20 as a backup system during emergencies. The company said that could disrupt= =20 service to its regular customers. ?????"It's not really economical to have our facilities standing by--not=20 being used--and not being paid for it," said Steve Rahon, a Gas Co.=20 regulatory manager. "They want our facilities to be ready in case they can'= t=20 receive all of their load from the Questar pipeline. We want this tariff to= =20 be able to charge a fair price for that." ?????Furthermore, the utility says, its customers need to be protected from= =20 higher rates and the utility needs to be able to compete on a level playing= =20 field with interstate pipelines that play by different pricing and delivery= =20 rules. ?????The pipeline companies agree that bypass customers should pay a price= =20 for swinging back and forth between providers. But they argue that the=20 existing tariff is so high it is preventing fair competition. As proof of= =20 that, they say, energy companies have resisted siting power plants in the G= as=20 Co.'s territory. What's more, the tariff has never been triggered. ?????"It's important to note that no one has ever taken service under this= =20 rate because it's such a risk," Beach said. ?????During a rate proceeding last year, the PUC found that "gas supply=20 competition is critical to the economic survival of both existing and new= =20 electric generators" and agreed that the tariff may be discouraging the=20 siting of new power plants in the Los Angeles Basin. ?????The commission ordered Southern California Gas to come up with a new= =20 pricing system that must "not be the equivalent" of the old one. The Gas Co= .=20 has proposed two alternative rate structures, both of which do not impress= =20 the pipeline companies. ?????It will be up to Brown, the administrative law judge, to choose betwee= n=20 the Gas Co.'s proposals and those suggested by opposing parties. She could= =20 also suggest yet another rate, or repeal the existing tariff altogether. ?????"I need to write a decision. And that's kind of a daunting project,"= =20 said Brown, who inherited the case in January. ?????"I really can't give you a projection," she said. "It's one of those= =20 things that if the commission decides it's incredibly important and needs i= t=20 done, it will be moved to the top of my list. And that order could come at= =20 any time or it might never come." ---------------------------------------------------------------------------= --- ------------------------------------------------------------------ Experts Doubtful About Rush to Build Small Power Plants Energy: State wants =01,peaker=01, units to fill 40% of summer gap. But var= ious=20 factors make that seem unlikely. By TIM REITERMAN, Times Staff Writer ?????Gov. Gray Davis has mobilized state government and invited developers = to=20 put dozens of small =01+peaker=01+ power plants online =01+at warp speed=01= + to help=20 avert blackouts this summer. ?????But, as California races against time, industry experts say the=20 logistics and uncertainties of power plant construction make it doubtful th= e=20 state will have as much peaker electricity as it is seeking: ?????Generating turbines--which resemble giant jet engines--are in tight=20 supply. Design, engineering, construction and testing take several months.= =20 And community opposition is sometimes a concern because the plants can be= =20 noisy and add to air pollution. ?????Without knowing how much people will conserve, state officials estimat= e=20 the summer energy shortage at about 5,000 megawatts--enough to serve 3.7=20 million homes. They are counting on emergency peaking plants, usually=20 providing 50 to 100 megawatts each, to make up about 40% of that shortfall. ?????But records and interviews with energy experts, state officials and=20 potential plant developers show that: ?????* A contracting program the state hopes will bring in about 1,100=20 megawatts of peaking power has been stalled for weeks. Officials are still= =20 negotiating with about 10 developers and are uncertain how much power will = be=20 available for summer. ?????* An effort begun last year to issue plant permits within four months= =20 led to approval of only one 50-megawatt plant at San Francisco Internationa= l=20 Airport. Officials there say the deal is collapsing. Half a dozen other pla= nt=20 applications were withdrawn due to site problems, including pollution. ?????* The state=01,s new accelerated 21-day permit approval program is far= from=20 meeting Davis=01, goal of getting plants capable of producing an additional= =20 1,000 megawatts in operation for the summer. ?????The California Energy Commission approved two projects, and five more= =20 are being reviewed, for a total of about 500 megawatts. State officials=20 concede that not all the power will be available the entire summer because= =20 developers have until Sept. 30--after summer ends--to get plants online. ?????During a recent workshop to promote the construction of peaker plants,= =20 Roger Johnson of the energy commission said the panel is tracking an=20 additional 900 megawatts worth of plant proposals that developers are=20 expected to file in April. ?????=01+It is possible we can meet the goal,=01+ he said, adding that Sout= hern=20 California Edison has 20 requests for new power plant hookups totaling an= =20 additional 1,665 megawatts. ?????Can those proposed Southern California plants, most of them designed t= o=20 run during times of peak electricity demand, be ready for the summer? ?????=01+We don=01,t think so,=01+ said Ronald D. Nunnally, director of fed= eral=20 regulation and contracts in Edison=01,s transmission and distribution unit.= =20 =01+There=01,s a lot of hurdles. . . . A workshop [like this] would be more= useful=20 for next summer. ?????=01+Anything not in the process now has [only] a remote chance of bein= g=20 online this summer,=01+ he said in a remark echoed by a number of plant=20 developers. =01+Chances are slim.=01+ ?????=01,People Can=01,t Seem to Move=01, ?????The=20 state reserved a cavernous auditorium at an Ontario hotel March 29 for what= =20 was billed as a workshop and =01+energy fair.=01+ About 50 potential develo= pers,=20 consultants and sellers of power turbines attended. And many, while praisin= g=20 the state=01,s efforts to encourage deal-making and streamline permitting, = had=20 no deals on the horizon, let alone in the works. ?????=01+People can=01,t seem to move,=01+ said Los Angeles consultant and = developer=20 Bob Hoffman, who attended the conference to sell a Japanese turbine that=20 could power a peaker plant. =01+I talked to people with great projects. It = doesn=01, t seem to be congealing.=01+ ?????After two weeks on the California market, the=20 turbine was later sold for use in a plant in Nigeria. ?????To encourage plant development, the state has compressed the permit=20 process. It has offered to quickly contract to purchase power. It has helpe= d=20 prospective developers find smog credits, which allow them to emit air=20 pollutants for a price per ton. And it has enlisted major utilities in=20 quickly hooking up proposed plants to natural gas lines that fuel them and = to=20 the grid that carries electricity to users. ?????=01+Nobody has ever moved this rapidly, still being mindful of all=20 environmental standards, to put power online,=01+ Davis told The Times=01,= =20 editorial board Friday. ?????The energy commission has also developed a list of potential peaker=20 plant sites that have a minimum of two acres and proximity to gas and=20 electricity infrastructure. ?????The commission identified the San Francisco Bay Area, parts of the=20 Central Valley and San Diego as the regions most in need of peaking power= =20 plants, but said the Los Angeles region could also benefit. ?????Thirty-two sites with a potential for producing 1,700 to 3,400
|