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State Is Hit With Power Emergency

Electricity: Several generating plants interrupt service amid rising temperatures, but blackouts are avoided. Energy prices soar.

July 10, 2002|NANCY VOGEL and KELLY YAMANOUCHI | TIMES STAFF WRITERS

SACRAMENTO — Searing heat across the West and an unusual number of power plant shutdowns forced California to declare an electricity supply emergency Tuesday for the first time in a year.

No blackouts were triggered, but power prices vaulted to their highest level of 2002. So did demand, as Westerners cranked up their cooling systems.

The crew that balances supply and demand on most of California's electrical transmission system struggled to import enough power from neighboring states as temperatures hit 92 degrees in Portland and 108 in Phoenix.

"We are stepping up our call for conservation," said Stephanie McCorkle, spokeswoman for the California Independent System Operator. "Consumers will really help us if they avoid using the heavy electrical appliances now through Thursday. Temperatures are only going to increase tomorrow."

For The Record
Los Angeles Times Saturday July 13, 2002 Home Edition Main News Part A Page 2 National Desk 7 inches; 272 words Type of Material: Correction
Hot temperatures--A story in Wednesday's California section about power shortages incorrectly stated that the hottest weather recorded in California on Tuesday was 113 degrees in Needles. A temperature of 128 degrees was recorded that day in Death Valley.

Temperatures hit 87 degrees in downtown Los Angeles, 81 in Santa Maria and 108 in Palm Springs. The hottest weather in California was recorded in Needles, where the temperature rose to 113.

In San Francisco, normally relatively cool this time of year, temperatures reached 90 and it wasn't just the tourists wearing shorts.

"It's like Hawaii!" Betsy Castillo said in the downtown financial district. "This is the first day all year I didn't have to leave home with a sweater or a jacket."

The power emergency forced Cal-ISO to lower a federal price cap on electricity that applies across the West. Some warned that lower prices could discourage electricity sales to California in coming hot days.

Cal-ISO declared a Stage 1 emergency--the first since July 3, 2001--when power reserves fell below a 7% buffer. In such a situation, businesses that have agreed to curtail consumption are asked to do so.

Demand for electricity hit 41,838 megawatts at 3:25 p.m., the highest peak consumption of the year. And the unexpected shutdown Monday night of power plants that could produce 2,700 megawatts of power--enough to supply 2 million homes--compounded Cal-ISO's problem. Tension returned to its control room in Folsom, east of Sacramento, where workers had struggled daily in the winter of 2000-2001 to avoid blackouts.

In all, 5,000 megawatts of power plant capacity was down Tuesday for planned or unexpected maintenance, more than twice the usual amount for summer. (A megawatt-hour is roughly enough electricity to supply 750 homes for an hour.)

The hobbled power plants included a 700-megawatt unit owned by Mirant Energy in Pittsburg, near San Francisco Bay. A broken pump kept the unit running at half of capacity, said Mirant spokesman Patrick Dorinson.

Another nearby unit capable of producing 150 megawatts was shut down, he said, because PG&E has yet to fix circuit breakers in the switching yard that carries electricity away.

"Everything else is available and running," Dorinson said of Mirant's power plants in the Bay Area.

In Sacramento at the Department of Water Resources, which has been buying electricity for three financially troubled utilities since January 2001, long-term contracts allowed power buyers to remain calm.

The DWR's tens of billions of dollars in long-term contracts, criticized by many as overly expensive and inflexible, provided such a great margin of supply Tuesday that the agency sold up to 700 megawatts of excess power to other California suppliers, said DWR spokesman Oscar Hidalgo.

The agency buys power for 27 million people served by Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric.

"We prepared ourselves for hot weather," Hidalgo said. "This is why it's important to hedge yourself against the volatility of the market. Today we're not exposed so fully as we were a year ago to these types of up and down swings in the market."

McCorkle said the DWR's sales probably helped offset the megawatts lost when power plants shut down unexpectedly.

Electricity prices jumped Tuesday to $68 per megawatt-hour and higher, from a $30 range just a week ago.

But even the higher prices stayed below the $92 per megawatt-hour price cap imposed by the Federal Energy Regulatory Commission in a June 2001 order that was intended to stabilize California's erratic power market.

That order, however, dictated that the price cap would be reset whenever California power supplies slipped below a 7% margin for more than an hour. The Stage 1 emergency, declared at 2:40 p.m., lasted until 7 p.m.

The new price has been set at $57.14 per megawatt-hour, said McCorkle.

Under the federal order, California power plant owners must supply electricity to Cal-ISO if it is available and needed. But the new, lower price cap could discourage power producers from releasing water from reservoirs or buying natural gas to run more power plants, said Gary Ackerman, executive director of the Western Power Trading Forum.

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