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Pastimes : The California Energy Crisis - Information & Forum -- Ignore unavailable to you. Want to Upgrade?

To: Bearcatbob who wrote (235)	4/12/2001 9:12:05 PM
From: DavesM	Respond to of 1715

Maybe the State should move to Eastern Time. That way, just as its really getting hot, people will be getting off work, and going home (5pm ET = 2pm PT). Or we can keep Pacific time but have long afternoon siestas, like Latin and Mediterranean countries. :)

To: Bearcatbob who wrote (235)	4/12/2001 10:42:46 PM
From: gamesmistress	Read Replies (2) \| Respond to of 1715

Don't discount the possibility of confiscation as an option for the CA state govt. Hardball time could be coming up fast. What do you think Davis' response will be to this situation - a lecture on Economics 101? Uh-uh. What's needed here is a mediator, and quickly - it should be FERC I think. Thursday April 12 6:46 PM ET Calif. Utility Defies Demand to Shut Generators SAN DIEGO (Reuters) - Utility San Diego Gas & Electric said Thursday it had resisted and was ``appalled'' by a demand to shut 18 power generators it operates on behalf of Houston-based energy company Dynegy Inc. The utility, a unit of Sempra Energy, said Dynegy has threatened legal action if it refuses to comply. The combustion-turbine generators, located in San Diego County, produce around 250 megawatts of electricity, enough to power 250,000 homes. ``Given the energy crisis gripping our state, we are appalled that you would even consider such an action,'' said SDG&E president Debra Reed in a letter to Dynegy. The utility said Dynegy notified them of the decision Wednesday, citing credit issues associated with the California Independent System Operator (news - web sites). The credit-worthiness of the California ISO, which operates 75 percent of the state's power grid, had been impacted by the financial woes of its two largest customers, utilities Pacific Gas and Electric and Southern California Edison (news - web sites). Last week California's largest utility, San Francisco-based Pacific Gas and Electric, filed for Chapter 11 bankruptcy protection. The utility had spent billions of dollars buying electricity which it was not allowed to pass on to its customers under the state's 1996 deregulation legislation. ``To insist that the combustion turbines be silenced under these conditions reveals a callous indifference to the basic needs of call Californians and their right to receive reliable electric service,'' Reed's letter to Dynegy said. Dynegy spokesman Steve Stengel said his company wanted to sell the power to a credit-worthy entity. He said under an order issued by the Federal Energy Regulatory Commission (news - web sites) (FERC) on April 6 it was not required to sell to the California ISO unless the agency could provide a credit worthy buyer. Most of the power produced by Dynegy in California is sold to the credit worthy California Department of Water Resources under long-term contracts. SDG&E sold the generators to Dynegy in 1999 and is under contract to run them until May 22. The utility said the sales agreement provides SDG&E with the legal authority to continue operating the generating units, if the ISO calls for such action. California is in the midst of a chronic power shortage that last month triggered rolling blackouts. Pacific Gas and Electric is a unit of PG&E Corp and Southern California Edison a subsidiary of Edison International.

To: Bearcatbob who wrote (235)	4/14/2001 1:04:14 AM
From: Angler	Read Replies (2) \| Respond to of 1715

The bidding process, I agree, can lead to distortions when the supply does not match the demand. If one has some surplus to sell, he can try to find the market beginning his bid high searching for an advantage price point. By trial and error, since each day begins a new competitive bidding process with an unstoragable commodity, it would behoove the suppliers to edge their prices higher than lower. Gradually the market results of each days successful bids would not only indicate but create higher prices. So if there were more sellers than buyers, the turn of the screw would work in reverse. Would it be possible for the State to rule that they would only purchase power at XX$ and then see if any surplus power existed to serve the need thereby retaining some control over the cost? Each day or the end of the previous day couldn't the authorities issue their open end needs for the next day and their "limit price" for bids? If there are no surpluses, all bets are off. If only one bidder was available, he surely could name his own price. In this case we have only one buyer. As the number of bidders increases, competition increases and the price would adjust. The only other way the suppliers can maximize their advantage is to collude and agree on pricing (fixing) which in any book is illegal. That the Governor will not release and open negotiations could be a poor idea. In privacy the contractors may find it more to their liking in lieu of unknown long term contracts? During this emergency could it be an innocent mistake again on the part of administration?