More demand or less supply?

Fri May 18 15:44:59 UTC 2001

There's an interesting sidebar in an old "America's Network" magazine
about why there was a shortage.  It's too long to include here (and likely
too far off-topic), so here's a link.

They don't include this sidebar in their online edition, and I typed it in
after a similar debate over at the datacenter list:

http://www.inch.com/~spork/calpower.txt

Charles

| Charles Sprickman                  | Internet Channel
| INCH System Administration Team    | (212)243-5200
| spork at inch.com                     | access at inch.com

On 18 May 2001, Sean Donelan wrote:

>
> NERC is predicting California (and therefor Internet data centers
> in the region) may be subject to almost daily rolling blackout
> throughout the summer.  Although most major Internet data centers
> have backup generators, the historical reliability data everyone
> uses is based on "normal" power conditions in the USA, not daily
> rolling blackouts.
>
> Is California really out of power?  News reports indicate California
> is consuming less power than the same time last year.
>
> http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2001/05/03/MN202545.DTL
> > Energy consumption was down 9.2 percent, or 2,967 megawatts in March
> > compared with the same time last year. In February, the number was 8
> > percent, or 2,578 megawatts, and in January it was 6.2 percent or 2,091
> > megawatts.
>
> So why are there power shortages in California?
>
> http://www.latimes.com/business/reports/power/lat_suit010518.htm
> > A Times analysis of state data found that, throughout the last two months,
> > about 12,000 megawatts of production was offline, more than a third of the
> > peak power used in California on a typical day. That has been about evenly
> > divided between scheduled and sudden plant shutdowns.
> >     By contrast, shutdowns in the same period of 1999 and 2000 took only
> > 3,300 to 5,700 megawatts offline.
>
> Why is 2 to 3 times more capacity offline this year compared with previous
> years?  I don't know.  It appears the "supply" shortage is not due to
> increased demand, or even the lack of new power plant capacity; but due
> to the shutdown of existing capacity by generation companies at a higher
> rate than normal.
>
> Normally, when demand drops you would expect prices to fall. Consumption
> is down between 6.2% and 9.2%. However, in California generating companies
> have shut down power plants faster than demand fell, creating shortages
> and prices have been rising.
>
> It will be an interesting summer.
>
>
>