California regulators ordered rolling blackouts

Wed Jan 17 21:37:59 UTC 2001

It has begun. Welcome to the 3rd world.

http://www.sfgate.com/cgi-bin/article.cgi?file=/news/archive/2001/01/17/state1503EST0161.DTL

Blackouts hit California as utility financial woes deepen

Associated Press, SF Gate 	 	Wednesday, January 17, 2001
Breaking News Sections

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California regulators ordered rolling blackouts Wednesday for the 
first time in the state's months-long electricity crisis, blaming 
utility credit problems and a tight national power supply for the 
scattered outages.

The rotating blackouts, expected to affect about 500,000 customers 
for an hour to 90 minutes, were restricted to Pacific Gas and 
Electric Co. territory in northern and part of central California, 
said Stephanie McCorkle, a spokeswoman for the Independent System 
operator, keeper of the state's power grid.

A PG&E spokesman said that about 250,000 people were already without 
power from the blackouts that began at 11:41 a.m. There are reports 
of outages in San Francisco's Lower Haight, Oakland's Rockridge area, 
the Oakland Hills, Orinda, the Peninsula from South San Francisco to 
San Mateo, parts of Napa and Sonoma County, downtown San Jose, 
Cupertino's De Anza College, San Ramon, Santa Cruz, Benicia and other 
areas, according to radio and TV reports.

There was a report of two students being trapped in an elevator at 
Hastings School of Law in San Francisco. Some ATMs were reported out 
of service in downtown San Francisco.

Power was cut to the Cow Palace in Daly City, which is holding a boat 
show, according to an administrative worker at the exhibition hall. 
The main building remains well-lit from emergency lighting and 
skylights, she said.

KICU-TV, channel 36, was knocked off the air.

The blackouts would first affect customers in scattered areas known 
as blocks 3 and 4. For security reasons, the precise locations are 
not released. Consumers can find their block numbers at the bottom of 
their power bills.

PG&E and state officials urged conservation and said it was not known 
yet if blackouts would be ordered for blocks 5, 6 and 7. Blocks 1 and 
2 had power outages last June.

BART, fire departments, police stations and hospitals are not 
affected. Motorists who come to non-functioning traffic signals, 
including El Camino Real in the San Bruno/San Mateo area and Lawrence 
Expressway in San Jose, should treat them as four-way stops.

Utilities try to avoid cutting power to blocks with essential 
services such as hospitals.

Terry Winter, president of Cal-ISO, said that a large power plant on 
California's Central Coast went down at about 11 a.m., necessitating 
the outages.

Worry that the state's two largest utilities were on the verge of 
bankruptcy led some suppliers to withhold power from California, 
despite an emergency federal order requiring them to sell excess 
electricity to the state, said Jim Detmers, the ISO's managing 
director of operations.

But Winter said later that he did not believe generators were 
withholding power. Instead, he said, the main problem is broken power 
generating facilities, many of them older plants that have been run 
heavily since June.

Compounding the problem is a general scarcity of electricity 
nationally, and a lack of snow and rain in the 
hydroelectric-dependent Pacific Northwest, Detmers said.

``If you are out in the community and get into an intersection that 
is in the blackout, use caution,'' he said.

The day began with the third Stage 3 power alert within a week, 
meaning reserves were close to just 1.5 percent. The warning marked 
at least the third time California neared blackouts since its power 
woes began last summer.

The ISO fended off outages before by temporarily turning off huge 
state pumps that move water from Northern California to the south, 
sucking enough power for 600,000 homes, but that wasn't enough 
Thursday.

Suppliers were ``reluctant to provide power to California because of 
the financial situation of the utilities,'' Detmers said.

He said the ISO wasn't probing whether suppliers were flat-out 
ignoring Energy Secretary Bill Richardson's emergency order insisting 
that any spare power go to California, however.

``We're just trying to get the power delivered,'' he said.

Adding to the problems, several power plants that were expected to 
return to full operation after repairs did not, Detmers said.

On Tuesday, Southern California Edison declared itself unable to pay 
hundreds of millions in wholesale electricity bills, and it and PG&E, 
the state's largest utilities, took another hit on Wall Street.

SoCal Edison, which serves 11 million people, said it cannot pay $596 
million in bills for wholesale energy and debt service, including 
$215 million to the California Power Exchange.

The Power Exchange was considering whether to make the utility buy 
its power elsewhere and an electricity supplier threatened to force 
SoCal Edison into bankruptcy if it failed to pay its bills.

The default prompted Standard & Poor's and Moody's to downgrade the 
credit ratings of SoCal Edison and PG&E to junk-bond status.

The credit agency said SoCal Edison's delinquency also tainted PG&E. 
With just $500 million in cash left as of Jan. 10, PG&E faces due 
dates on bills totaling $1 billion during the first two weeks of 
February.

Between them, PG&E and SoCal Edison have lost at least $10 billion in 
wholesale energy costs. A rate freeze imposed as the state phases in 
deregulation has blocked them from passing on higher wholesale costs 
to their customers.

Wholesale power prices have risen dramatically since June, in part of 
because of a hot summer and a cold winter. In 1999, they averaged 
perhaps 3.5 cents a kilowatt. Now, they are running about 30 cents, 
and sometimes far higher.

Demand has remained high, supplies are strapped because no new power 
plants have been built in the state in recent years and imports are 
tight because other states are fighting over the power.

In addition, spiraling prices for natural gas are forcing power 
plants to raise their prices. Most power plants are fired by natural 
gas.

On Tuesday, unusually high demand for natural gas, due in part to 
cold weather, led San Diego Gas and Electric to cut supplies to two 
power plants, contributing to the state's Stage 3 alert.

The utility said there was plenty of natural gas, but not enough 
space in the pipeline to meet its customers' needs. To maintain the 
supply for its home and small-business users, the utility cut the 
flow to the two power plants and six large industrial customers.

The state avoided rolling blackouts after huge state pumps that move 
water from Northern California to the south were turned off 
temporarily, conserving enough electricity to power 600,000 homes, 
said Kellan Fluckiger, the ISO's chief operating officer.

Joel Nelsen, president of California Citrus Mutual, spent Tuesday on 
the phone with Central Valley lawmakers and the governor's office 
trying to ensure that orange growers wouldn't face outages as they 
tried to protect crops from a cold snap.

``We're terribly exposed,'' said Nelsen, who heads a trade 
association of 800 growers. ``The loss of power for a short time 
could wreak untold damage on our crop.''