To: Second_Titan who wrote (81262 ) 12/11/2000 11:40:14 AM From: Douglas V. Fant Read Replies (3) | Respond to of 95453 Quehubo007, From today's Public Power Daily. Do you think that the political leaders of California have the courage to admit their mistakes for leaning too far to the environmental side of land use planning? Or will they just continue to blame the power companies? Demagoguery will not create megawatts- Power plants create megawatts- and California desparately needs to build some and then assure their fuel supplies.... 12/11/00 8:11AM Subject: Public Power Daily, December 11, 2000 FERC Lifts Calif. Price Cap; Draws Governor's Ire Temperatures were low and tempers were high in California this weekend as Gov. Gray Davis and the chair of the state Public Utilities Commission reacted angrily to federal regulators' decision to remove a price cap on wholesale power in California. The Federal Energy Regulatory Commission on Friday gave the California Independent System Operator permission to remove its $250 cap on the price of a MWh of electricity. FERC's order is similar to a more permanent one it is expected to issue later this week. Davis called for a congressional investigation of FERC's action and said he will "dismantle the current ISO and reconstitute it in a way that will be responsive to Californians." FERC's action will impose enormous costs on California residents, he said. "The ISO asked for a remedy that might not work and will leave California consumers and businesses naked against exorbitant rate hikes," said PUC Chair Loretta Lynch. But Terry Winter, chief executive officer of Cal ISO, said removal of the price cap would mean high-cost generators in California no longer have any reason to keep high-cost generating units idle. He expressed hope that the move would bring several hundred MW of in-state generation to the state's power grid. Doug Heller, a consumer advocate with the Foundation for Taxpayer and Consumer Rights, called on the governor to "direct state authorities to immediately take over power plants that are off-line and safely get them online and producing energy." Meanwhile, continued cold temperatures in California and the Pacific Northwest, prompted officials to issue "stage 2" emergency alerts. In California, a stage 2 alert means power reserves are below 5%. Yesterday's alert was the seventh consecutive day of stage 2 alerts in the state. In the Northwest, a stage 2 alert means there may be blackouts. Temperatures are projected to be unseasonably low, in the 20s, this week in the Pacific Northwest. "Absent extraordinary measures, we won't meet the load Monday," said Dick Watson, a member of the Northwest Power Pool emergency response team and power director for Northwest Power Planning Council. Major customers in the Northwest have agreed to curtail operations. Both Seattle City Light and Tacoma Public Utilities said they expect to have adequate supply to meet all customer needs. Bonneville Power Administration will be permitted to violate salmon protection measures to increase power production at hydroelectric projects on the Columbia River. In its order on Friday, FERC gave Cal ISO permission to lift the $250 MWh price cap. Bids above that amount are permitted, but will not set the clearing price paid to all sellers. Any sellers who charge more than $250 a MWh will be required to document their costs. FERC also authorized the ISO to penalize generators that refuse to operate in response to the ISO's request in an emergency. They will be charged an amount equal to twice the highest price paid by the ISO for each hour in which a participating generator failed to respond. Supplies may grow more plentiful in California this week. One unit of the Diablo Canyon nuclear plant resumed operation, after an outage for repairs. Also, the South Coast Air Quality Management District on Friday agreed to allow some dirty power plants to generate power. They will have to pay daily fines for exceeding emissions limitations.