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Gold/Mining/Energy : Strictly: Drilling and oil-field services

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To: Second_Titan who wrote (85205)	1/24/2001 9:40:38 PM
From: Zeuspaul	Read Replies (1) of 95453

Why do you think SCE & PCG in a regulated environment would have had better luck siting plants than the nimble IPP's? I don't recall saying that. I indicated that California would not be in its current crisis if things had been left as they were. There would have been no need to site existing plants as the plants were already sited and generating juice for the California market. Siting new power plants to match the growth in demand would have been a better way to experiment with new ideas. Making a radical change to a working system is not a good way to execute a change IMO. Radical changes make sense in situations when a system is not working...ie failing. We are currently in the off season for juice. Demand rises in the summer when people turn on their air conditioners. So if we are talking about our current shortfall it would be hard to make an argument that the utilities would not have had the capacity to meet demand. In addition if they had not been deregulated albeit in a botched way they would have had long term contracts in place for the juice that they purchase from others. So there would be very little purchased on the spot market...prices would not be out of control and there would be fewer or no capacity induced blackouts. Due to growth in demand even under the regulated scheme California would have had a short fall this summer...but not as severe as it is going to be as California utilities dispensed with their generating capacity and long term contracts. Perhaps someone who really wants to know should ask the IPP's for proof of plants they tried to site in CA but were denied over the last 5 years. I suspect this would reveal the depths of BANANA & NIMBY's costs. I have no doubt that siting plants in California is a difficult task. However one can still sell juice to California from a plant in another state...producers in Canada and some states are selling juice to California. One of the benefits to electricity is the flexibility as to where a plant can be sited. Siting a plant in an area with a pollution problem due to atmospheric conditions will naturally cost more than siting a plant in an area that is more conducive to dispersal of the by products of power generation. If one opts to not produce power and blames the radical environmentalists then the responsibility for power generation should be handed over to an entity that can get the job done. LADWP provides adequate and low cost juice to its customers in the California environment. If they can do it then so can others. So the choice is not to build or not to build. The choice is where to build. Those responsible for providing the power have to make that choice. In the deregulation experiment that choice now resides with the independent power producers. If the cost to site a plant in one locale is too high then site it in another. Isn't that how a market works? If someone is charged with the responsibility of providing the juice they can't just give up because they have to jump through some hoops. Naturally those that make the hoops have to pay more if siting a plant in another locale results in higher transmission costs. However higher transmission costs shouldn't increase the price of juice by 300 percent! Refineries, electric transmission lines, power plants, petro distribution lines all need to be built in CA We have a heck of a lot more refineries here in southern California than I ever saw when I lived in Taxachusettes. Maybe they have one but I never saw it. I bought a lot of heating oil and I am sure most of it was refined out of state. Also..the US does not have sufficient oil reserves to support more refineries. Our oil production peaked backed in the seventies. It would be better to spend our investment dollars for coal processing plants. Would you suggest trucking coal to California so California could process it into liquid fuel? Why not process it in a coal mining state and then move the product through a pipeline? I agree transmission lines and petro distribution lines have to be built. The distribution systems are what enable energy to flow from one place to another. Who is responsible for this..the market? I don't want three separate sets of power lines running all over the place just so we can have a competitive market in power lines any more than I want three power plants down the street so power plants can compete with each other. The power plant on the coast in Huntington Beach takes up a lot of real estate. There are dozens's of companies willing to compete to produce/sell electricity in CA. Do you suppose they are all conspiring to withhold supply? I don't subscribe to conspiracy theories. The problem is the market incentives do not achieve the desired result. As an outsider I look at the bottom line. Juice was plentiful and cheap in a regulated market. In the deregulated market juice is scarce and expensive. BTW jumped on the KEG bandwagon today...it seamed like the thread thing to do. Zeuspaul

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