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Hydropower Highlighted in SDG&E Buyout Plan

February 06, 1989|DANIEL M. WEINTRAUB and GREG JOHNSON | Times Staff Writers

"If we continued to be independent, we would continue to use hydropower as we have in the past," said Jim Kenney, SDG&E's manager of fuels and power contracts. "We have loaded up as best we can during times when hydro is plentiful. I suppose during times when certain hydro contracts come up for renewal, we will probably put in to get an allocation of it."

Kenney added that the proposed merger with Edison, which has access to roughly 1,500 megawatts of hydropower, would probably bring more of the resource to San Diego than either the status quo or a government takeover of SDG&E.

"San Diego will wind up with a higher mix of hydro than it has today," he said.

Even if hydropower were available and a San Diego customer wanted to buy more of it, getting the electricity to the county would be difficult, many in the industry say.

Part of the problem is that California's north-south transmission system--like the state's freeway system--is old and crowded. Building new transmission lines is an expensive and time-consuming process because local residents usually oppose them as undesirable land uses.

Additional Problem

There is an additional problem: The public owns the state's freeway system, but the Pacific Intertie, the only north-south high-voltage transmission system connecting California and the Pacific Northwest, is controlled largely by Southern California Edison and Pacific Gas & Electric.

The two investor-owned utilities control about two-thirds of two lines that travel through California to the Oregon border. Edison, PG&E and the Los Angeles Department of Water & Power, the nation's largest municipal system, control 86% of a third line that cuts through Nevada on its way to the Pacific Northwest.

That ownership structure has severely limited use of the lines by other Southern California municipal utilities such as Anaheim, Riverside and Azusa.

Ten years ago, the municipal systems initiated a federal court battle to gain access to the intertie. Transmission has gained in importance because "we're like islands in the middle of Edison," according to Gordon Hoyt, general manager of Anaheim's municipal utility.

Peter Matt, a Washington, D.C.-based attorney who has represented the municipal utilities in their fight to gain access to the intertie, said the municipals are basing their legal claim on a St. Louis railroad case decided in the early 1900s. A judge in that case determined that one train company could not refuse to give competitors access to a bridge over a river.

10-Year-Old Battle Continuing

"Without that bridge, you couldn't reach the train terminal, and without that terminal, you didn't have a business," Matt said.

The 10-year-old federal court battle is continuing.

Edison critics contend that the Rosemead-based utility simply doesn't want to give publicly owned competitors in California access to cheaper hydropower available in the Northwest.

"It's sort of like saying there's so much food in the world that nobody need starve," according to Michael Shames, executive director of Utility Consumers Action Network, a San Diego-based consumer group. "Supply isn't the problem--distribution is."

Edison declined to discuss available capacity on the intertie lines that it owns. "That is something that will be discussed in (upcoming) regulatory proceedings," Edison spokesman Lewis Phelps said last week.

340-Mile Line Proposed

Concern about future access to transmission lines led 15 municipal utilities in Northern California to propose a 340-mile transmission line that could become operational by 1993, according to Steve McClary, a staff person with the Sacramento-based Transmission Agency of Northern California.

The 15 municipal utilities, including the Sacramento Municipal Utility District and the Modesto Irrigation District, would own 42% of the proposed "California-Oregon Transmission Project." Municipal utilities in Southern California--such as Anaheim, Riverside and Banning--would own about 7.5% of the new line.

The state's three largest investor-owned utilities would own 40% of the project. Edison would own 17.5%, PG&E would own 20.4% and SDG&E would own 2.9%. However, the state Public Utilities Commission has yet to grant required permits that would clear the way for the investor-owned utilities to take part in the $400-million project.

Sen. Stirling suggests that a municipal utility in San Diego could dramatically increase SDG&E's share of that line or work to build yet another. He also said he will support legislation first proposed last year to require all utilities to provide access to their lines to "wheel" power around the system.

Beyond that, Stirling advocates a public takeover of all the state's long-distance power lines, an idea that would be fiercely fought by the investor-owned utilities that built the lines.

State Should Condemn Interties

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