From: John Woolfolk, San Jose Mercury News, Calif.
Published October 23, 2004 12:00 AM

Southern California Called Vulnerable to Rolling Blackouts

Oct. 23—Limited high-voltage line capacity and the mothballing of old power plants could leave Southern California on the brink of rolling blackouts in the next couple of years, according to a state report released Friday.


The California Energy Commission report said Northern California is not expected to run into serious shortages until late 2007 or 2008.


"When we looked at the regions closer, we realized that Southern California is more precariously balanced and closer to emergency stages than we'd anticipated a year ago," said California Energy Commission spokeswoman Claudia Chandler.


State officials warned more than a year ago that California as a whole could face serious electricity supply shortages as soon as 2006.


The growing population and rebounding economy are driving up demand. But energy provided by state contracts signed during the power crisis in 2001 is tapering off, power-line bottlenecks remain and aging power plants are nearing retirement while new construction has slowed.


A report last year concluded that the state should have enough electricity through 2009 if the weather is mild, but could suffer rotating outages in 2006 if the summer is unusually hot and drives up demand for air conditioning.


When the energy commission looked at the problem regionally for its updated report, stark differences emerged between areas served by Pacific Gas & Electric and those served by Southern California Edison and San Diego Gas & Electric.


Northern California, served by PG&E, "should have adequate reserve margins under normal and hot weather conditions from 2005 through 2008," the report said.


Southern California, served by the two other utilities, would see emergency shortages next year even with normal weather, and "rotating outages under hot weather conditions."


The report also says old power plants totaling 9,000 megawatts worth of electricity generation are likely to be shut down over the next three years because they are so inefficient that they are no longer profitable for their owners. A megawatt powers about 750 homes. Two-thirds of that power is in Southern California, meaning likely retirements will "only exacerbate the already serious outlook," the report said.


Making matters worse, power-plant construction, which accelerated from 2000 to 2002 during the state's energy crisis, "has slowed significantly in the last two years," the report said. And while Southern California needs them most, "the vast majority of the plants that have been licensed, but not yet constructed, are in the northern part of the state."


"Everyone in the industry is aware that Southern California faces the biggest challenges going into this next summer," said Stephanie McCorkle, spokeswoman for the California Independent System Operator, which runs the high-voltage grid.


Southern California shortages don't necessarily trigger problems up north, McCorkle said. New plants such as Calpine's 600-megawatt Metcalf Energy Center in San Jose, expected to be online in July, will help insulate the Bay Area from Southern California shortages, she said.


But McCorkle added that "we are one big grid, and when operating reserves are narrow in one area of the state, it's always a concern to the other end."


SDG&E spokesman Peter Hidalgo said the utility agrees that "electricity supplies are going to be tight."


Edison spokesman Paul Klein said the utility has not completed its assessment of the report and was not prepared to comment.


The report recommends that the state find ways to make it economical for owners of old power plants to keep them available for the 50 to 100 hours of the year when shortages become critical. It also recommends accelerating programs to deploy new meters that will let customers, particularly big businesses, save money by reducing power usage during those critical hours.


The report further recommends longer-term planning for transmission upgrades and renewable energy resources.


IF YOU'RE INTERESTED
The report is available at http://www.energy.ca.gov/2004policyupdate/documents/© 2004, San Jose Mercury News, Calif. Distributed by Knight Ridder/Tribune Business News.


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