Bill Richardson and California Electriciy Problems.

[glen.vickers@exeloncorp.com]

[Vickers, Glen]  Read the article behind my shallow comments...

 
> Energy Secretary Richardson is causing others to subsidize energy prices
> in 
> California, when the rest of the country must pay their fair share.  The 
> utilities in the region got the short end of the deal when they were
> limited 
> to what they could charge the customer, but were denied the ability to 
> recover costs due to increases in wholesale prices.  
> 
> Is California the only state in which such ridiculous utility legislation
> be 
> passed?  
> 
> Should state legislated stupidity on such a grand scale be a good case for
> 
> the federal courts?
> 
> Will they meltdown the Northwest transmission lines like they did before?
> 
> Where was the guiding wisdom of the Clinton administration during the
> dereg 
> process?
> 
> There are enough problems in the world, it's just really disappointing
> when 
> the state of California thought long and hard and made a concious decision
> to 
> create a new one.  How many of us spend time at work fixing problems
> created 
> by others?
> 
> I really feel for those who work for the struggling utilities in
> California.  
> Hopefully they'll survive and I'm not just talking about their 4th qtr 
> earnings projections.  
> 
> Glen Vickers
> Nuclear Power HP
> 
> 
> 
[Vickers, Glen]  

> California Warns of Power Outages
> 
> By STEVE LAWRENCE
> .c The Associated Press
>   
> SACRAMENTO, Calif. (AP) - Energy Secretary Bill Richardson ordered
> Northwest 
> power suppliers to sell electricity to power-strapped California utilities
> 
> Wednesday, a move that appeared to avert the immediate threat of rolling 
> blackouts. 
> 
> The announcement came as state regulators warned rolling blackouts were 
> imminent due to power shortages within the state and an inability to buy
> more 
> electricity from the Northwest. 
> 
> The warning came from the Independent System Operator, keeper of
> California's 
> power grid. It said that electricity supplies were so perilously low that
> it 
> might declare a Stage 3 power emergency for only the second time ever. At 
> Stage 3, the grid can impose blackouts. 
> 
> Richardson said at a Washington, D.C., news conference he was using
> emergency 
> powers to force wholesalers to sell power to California at a price he
> deemed 
> fair. He said he would also request that two large Pacific Northwest power
> 
> generating associations send more power to California. 
> 
> ``Our objective is to keep the lights on in California through this
> emergency 
> situation,'' he said. ``We're dealing with a potentially very serious 
> situation here.'' 
> 
> California has been caught in a power crunch over the past several days,
> in 
> part because of cold weather in the Northwest - where California buys much
> of 
> its power - and the shutdown of some generating plants for maintenance. 
> 
> Stephanie McCorkle, an ISO spokeswoman, said the threat of blackouts was 
> delayed at least two hours Wednesday afternoon after the Bonneville Power 
> Administration diverted 1,500 megawatts to California. 
> 
> But she said there was no guarantee that flow of electricity would
> continue 
> past mid-afternoon ``because the power is needed up there in the
> Northwest.'' 
> 
> ``We are literally on the phone hunting for megawatts,'' she said. 
> 
> California's two largest utilities, Pacific Gas and Electric and Southern 
> California Edison, are near bankruptcy due to skyrocketing wholesale power
> 
> costs, Gov. Gray Davis and Sen. Dianne Feinstein, D-Calif., said at a 
> Washington, D.C., news conference with Richardson. 
> 
> Davis and Feinstein asked federal regulators to set a regional price cap
> on 
> wholesale electricity to prevent the high prices that have plagued 
> California. On Friday, the Federal Energy Regulatory Commission lifted
> price 
> caps in California. 
> 
> Record wholesale power prices followed, and PG&E warned it was in
> financial 
> danger. 
> 
> The problem became especially acute when about a dozen suppliers began 
> demanding cash before selling power to California, Kellan Fluckiger, the 
> ISO's chief operating officer, said Wednesday. 
> 
> ``The credit limits of utilities and what markets are willing to sell us
> have 
> been reached and surpassed in many cases,'' Fluckiger said. ``There are 
> questions about utility solvency. That has come to a head today.'' 
> 
> He said officials may have to interrupt power to as many as 4 million 
> customers Wednesday afternoon and early evening, when people come home
> from 
> work and power demand hits a peak. 
> 
> An unprecedented Stage 3 emergency was issued last Thursday, meaning
> reserves 
> had fallen below 1.5 percent. But the state fended off rolling outages by 
> turning off two power-sucking water pumps. 
> 
> This time, Fluckiger said any blackouts would probably last about an hour
> to 
> 90 minutes and occur mostly in Northern California. 
> 
> ``It's a fairly bleak picture,'' he said. ``This thing will not change
> unless 
> something is done to alleviate the credit situation.'' 
> 
> A Stage 2 alert was declared Wednesday afternoon, meaning power reserves
> fell 
> below 5 percent and large commercial customers could be asked to reduce
> power 
> consumption. A Stage 1 alert was declared Wednesday morning, meaning power
> 
> reserves were below 7 percent and all power users are asked to conserve. 
> 
> Stage 1 and Stage 2 emergencies have become routine this month, but last 
> Thursday's Stage 3 was the only time the threat of blackouts loomed. 
> 
> Contributing to the problem is a shortage of water to power hydroelectric 
> generators in the Northwest and California, Fluckiger said. 
> 
> ``We have reservoirs so low that we have people standing by them watching
> the 
> situation to make sure it does not go below safe limits,'' he said. 
> 
> The power crunch over the past few months has been blamed in part on 
> electricity deregulation. California approved a phased-in deregulation of
> the 
> electricity market in 1996 to try to lower prices for consumers through 
> competition, but so far it has led to higher energy prices. 
> 
> At the same time, wholesale power costs have been soaring, in large part 
> because of skyrocketing prices for natural gas. Wall Street is worried
> about 
> utilities' financial health, and on Tuesday, a consumer group urged the
> state 
> to seize and run the strapped $20 billion electricity system. 
> 
> AP-NY-12-13-00 1906EST
> 
> Copyright 2000 The Associated Press. The information contained in the AP
> news 
> report may not be published, broadcast, rewritten or otherwise distributed
> 
> without the prior written authority of The Associated Press.  All active 
> hyperlinks have been inserted by AOL. 


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