Tuesday, May 31, 2005

California and Energy - a volatile mix

You would think that after the 'deregulation' fiasco 10 years ago that the public would tell the politicians to keep their hands off, but this is California where it is impossible to hold anyone accountable. After a 30 year legacy of the Energy Commission stopping construction of any proposed power plants, it isn't hard to figure that maybe we ought to get some built. Unfortunately, the investor-owned utilities are out of the generation business and don't really want to get back in. They get guaranteed returns on delivering power and pass through to the customers whatever costs the California Independent System operator manages to procure. The ISO, by the way, is a completely unaccountable public entity which sets its own agenda. Notice that in this whole pack of organizations, there is not one of them with any reason to care what their customers might think.
As a result, we are now on the fast track to a real customer pleasing program called Critical Peak Pricing, the sole purpose of which is to charge prices at times when power is short that are so high that customers will stop using electricity. This solves all problems - utilities make money,nobody has to worry about building new power plants and once again politicians have solved a problem. Everybody that matters is happy. It is just the customers who are inconvenienced.

There is another approach. Which is to build - or contract- for sufficient powet to supply the requirements of your customers.
California cities to dedicate Magnolia plant
The mayors and utility officials for six Southern California cities (Anaheim, Burbank, Cerritos, Colton, Glendale and Pasadena) participating in the 310-MW Magnolia Power Project will gather in Burbank on June 2 for the dedication ceremony.

The dedication will celebrate the largest municipal power plant built since the energy crisis of 2000-2001, project organizers said. The baseload plant will be available immediately to meet the customer needs of the participating cities.

The six cities have joined together under the Southern California Public Power Authority to secure lower cost energy supplies by building and operating their own power plant, which replaces a 1941 Burbank Water & Power plant. The new combined-cycle, natural gas-fueled plant is twice as efficient and 90 percent cleaner than the older units it replaces, the cities said. Air emissions will be controlled for nitrogen oxides and other gases with the use of the best available control equipment.

Burbank is the project manager and operator for Magnolia. Each of the six cities will schedule their own power output with Burbank for each hour of every day. This effectively makes the one large plant serve as six individual smaller units, providing scheduling flexibility and control for each city, project organizers said.

Municipally-owned utilities do just that and manage to sell electricity at lower prices than the investor-owneds most of the time. If customers were given the choice, what would they pick. Right now, the Cities of Davis, Woodland and West Sacramento are seeking annexation by a neighboring public power utility. They are looking for a different customer service philosophy from a community-owned organization.

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