Arg. The last sentence, you know, the one that doesn’t make any sense? The one that reads:
The fact that they could have, unfortunately, does not mean that they should.
Should read:
The fact that they could have, unfortunately, does not mean that they did.
Well try this story. the story apparently was fueled by workers at the plants themselves. Sorry I can’t do a fancy url with this one. http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2001/05/22/MN151793.DTL&type=news
There’s also a memo floating around, uncovered by a FERC economist. I thought I had on this computer but maybe it’s on the one at home, I’ll try to find it tonight/tommorrow.
stuffinb, great link. Please note that, if the power companies do turn out to be guilty of price manipulation, I’ll be amoung the first to hope that they get crucified. And, hell, it would be great news if the power companies did this - if supplies came back on line, life would be cooler around here.
But I’m withholding the happy dances until the allegations are proven. You’ll note that the names of the companies under investigation are still sealed by court order. That kinda reduces the joy that can be felt here.
My single biggest problem with this debate has been a tendency of each side of it to reduce the guilty to a single group: environmentalists, NIMBYist, Davis, Wilson, Bush, the power companies, deregulation, lack of deregulation. I suspect that there are fairly large helpings of blame to go around, and, at this point, I tend to dismiss out of hand anyone convinced that a single party is guilty. So, sorry if I came off as dismissive of Need2Know’s point - I am more than willing to believe that the power companies took advantage of the system. I don’t think, in the end, that they will turn out to be solely responsible.
bashere, I’d be very interested in seeing some substantiation regarding those 2 incidents. If you have it, please post it in the Price Cap Thread.
Please also take note of the following table, whose data was acquired here.
Power held offline (Megawatts): "Repairs"
1999 2000 2001
---- ---- ----
Nov 2988 < 10343
Dec 2569 < 8988
Jan 3068 2423 < 9940
Feb 5096 3243 < 10895
Mar 5740 3389 < 13737
Apr 5739 3329 < 14911
Follow the link for more complete data. Personally, I don’t see anything like 2 breaks in the 200MW range, which I’d expect from your explanation. The pattern seems wholly consistent with the intentional withholding of capacity, though. But please feel free to sketch out a competing explanation.
No, I’m not asserting a conspiracy; I’m asserting that for-profit companies are pursuing profits. It’s not even clear to me that such behavior is illegal, as long as there is no consultation among competing firms. So I’m not asking for crucification, just run-of-the-mill regulation. Much like we had in the days before deregulation.
Great question, I’m not sure of the answer. My understanding is that CA is currently a net importer of power. If they put a price cap on CA wholesale energy, the power would get sold in other states. So CA needs the feds to put a regional price cap in place.
Underlying all of this is a tight supply situation. 1) California had greater than expected economic growth and installation of supposedly power-hungry server farms. 2) Power companies were reluctant to commit investment to new plants until the rules of deregulation were laid out. 3) There’s a drought in the Northwest leading to a shortage of hydroelectric power. It is these tight supply conditions (as well as various other sundry errors) that create heightened potential for monopolistic pricing.
flowbark
Here’s the first link (nuclear power plant)
http://www.ocregister.com/business/features/2000/power/onofre00206cci.shtml
Here is a slightly better link on the same subject:
http://www.laweekly.com/printme.php3?&eid=23363
Basically, a portion of the reactor caught on fire, emergency shutdowns were initiated, the turbine was destroyed. We lost 1,100MW of power. The link I post is out of date - it will require considerably more then 45 days to replace the turbine.
I don’t have links listing the mw value by which droughts have reduced our power supply - I can give you all sorts of articles describing how bad things are going to be for seattlites, but I don’t think that would help. I’ll keep digging when I get home.
There are other plants off line as well. Producers of renewable energy were not paid by the utility companies. You might start reading about it here:
http://www.latimes.com/business/reports/power/lat_pge010413.htm
I don’t know if that counts for plants offline for repairs or not.
Looking at the numbers provided, I am not ready to rule out delayed and deferred maintainence.
Flowbark sayeth:
This is actually a true (shortened) version of what caused the problem, but I don’t know if that’s only what december was referring to. What you quoted from the link are efforts to stem the effects of the problem, and you are correct about those.
spooje:
Yeah, I know. Hopefully it will be enough to stem the need for as many rolling blackouts, but I’m not sure if two new power plants will be enough to support hundreds of thousands of air conditioners running during the day.
Needs2Know:
You and others might agree, but many others disagree.
Gray Davis is taking the heat for this because A) He’s the governor, and B) His plan is so full of holes that one can strain water from spaghetti noodles. By that I mostly refer to the fact that he is making sweeping claims that his proposed ‘solution’ is the end-all solution to the current problem, which is false. He is attempting to push a stopgap measure for the current problem and use it as a long-term solution, which will very possibly lead to further damage to California’s economy and social structure.
Bush has nothing to do with the cause for the problem, and Bush should have little, if any, intervention in solving the problem. Most conservatives feel that the government shouldn’t get involved at all. I feel the government should provide a loan to the California government, but should let California deal with the actual solution to the problem.
You bias, disgust, and loathe for Bush does not equate being at fault for the problem or the lack of aid from the Federal government.
What makes you think I get my information from the “right wing propaganda machine”? Because I’m trying to be logical? Because I don’t bash Bush with every opportunity I have? Because I don’t agree with you? :rolleyes:
Actually, the reason we do not have problems with power is because LA’s DWP is a municipal company, and therefore wasn’t included in the deregulation.
So you’re admitting that you’re impartial to arguments presented by Bush and republicans simply because you don’t agree with them? Then why are you attempting to debate if you’re not going to listen to the opposition? Arguing with you is then like arguing with a brick wall. The entire second paragraph is exactly the propaganda I’d expect to hear from closed-minded democrats (or similar to closed-minded republicans, for that matter). It is your opinion, it is not fact, and it is not ALWAYS what’s right or best because it’s what you believe.
:rolleyes:
They weren’t “blind”. Did you even read those articles? The Californian government IGNORED the signs and warnings. The Californian government HID warnings and memos from Federal regulators so that deregulation would be approved. You’re trying to downplay the fact that the state government fucked up and knew it to, essentially, that they were tricked into it.
bashire: Thanks for the links and the provision of a concrete argument. Allow me to address it in the Price Cap Thread, which has more of a policy bent and less of a “Who to blame?” bent.
I read an assertion of hidden memos in the article. I’m curious about the details; that sounds like malfeasance.
Appropos nothing, the mistakes were made during the previous (Republican) adminstration.
Let’s not forget that San Diego Gas and Electric screwed up by not shouting louder about the new system’s potential for gaming. As did PG&E for apparently being blissfully unaware of it. And three raspberries for the semi-comatose west coast media.
Asking FERC to set regional price caps to stem large private suppliers’ incentive to withhold output won’t cost the federal government anything. So assuming this is good policy (and it is) W and FERC are ducking their responsibilities to California and all those affected by the Golden State’s lowered output.
Thank you flowbark…ducking responsibility isn’t exactly how I’d put it but I’m sure it will not meet with the same rage and spittle that “neglecting”, “manipulating”, and “punishing” which would be my words would bring. Anyway, you slice it CA has been hung out to dry, with I say a reckless disregard for how it may eventually effect the rest us.
I also have to laugh at the notion that “conservatives” (or Mr. Bush himself for that matter) are disinclined to use “government intervention” in any instance unless it suits their purposes. The conservative argument for “smaller goverment” is in my mind a not very transparent ruse. Mr. Bush has proven in a matter of a few months that he is more than willing to intervene whenever it benefits one of his campain supporters, namely industry. He just seems very disinclined to intervene in behalf of the American people.
Needs2know
flowbark, sorry to keep you bouncing back and forth between threads. I don’t have a lot to add to the policy issue, since it appears to be primarily an economics debate.
I would point out that before that offline chart makes all that much sense, you need to look at a demand curve. California has been undergoing a fairly major boom in both business and housing. This boom started later than the rest of the nation. Additionally, the new homes built here have been built in the desert, not in the mild beach climate. This may lend strength to the theory that maintaince was delayed as plants tried to stay on line, and that we are paying for it now.
You are making it hard to disagree with you, so I’m bowing out of this thread for a while.
Some one asked why California can’t regulate wholesale energy.
Since the 30’s this has been under Federal Jurisciction. When California did it’s partial deregulation they had to get their plan approved by the FERC. By the way, the next three year renewal of that approval comes up for a vote soon.
I have to laugh at the notion that you want to blame Bush for a problem that was brewing before he was even elected.
Of course. It makes you feel better about yourself that way. It makes you feel smug, superior, and safe in your discriminatory ways. I’m glad that you can sleep at night.
And what, pray tell, is so bad about a strong industrial presence? Seems to me that you should be ROOTING for the strengthening of the economy.
flowbark
I’m interested in the details as well, because I want to know A) Whether it really occurred, and B) Whether this is a criminal infraction (which I’m sure it is).
I don’t care if they were Republican or Democratic, they made a mistake, we’re suffering from the results of their mistake, and I think our current governor’s plan is not complete and will not work in the long term as he is making it out to do. Party affiliation makes no difference to me.
I think I read somewhere that the major utilities did strongly object to deregulation, and that they warned of losses and potential bankruptcy. I’ll look it up, but if I’m incorrect I’ll retract any claim about this.
Just because I discourage needless Bush bashing, which Needs2Know insists upon, doesn’t mean I agree with him on all issues. I disagree with his stance on a lot of stuff. Bush and FERC are not “neglecting”, “manipulating”, or “punishing” California, as Needs2Know claims in her partisan conspiracy theory, but I do feel he (and Davis) is fumbling the issue.
Needs2Know
I don’t see CA as being hung out to dry, and I live here. In your biased, closed-minded opinion it is. You might also believe that it is indeed reckless, and that Bush is an evil overlord bent on making us slaves to big business. However, no matter how strongly you believe it, it doesn’t make it true. I’d recommend you maybe consider that your opinion isn’t always the one and only right way.
This just in… Our 2 leaders (snicker) Bush and Davis are having a pow wow tomorrow. Let me tell you, if W decides to go for price caps, I’ll be really disappointed -I’ll have to find another scapegoat. 
RE: Monster and the long-term: To tell you the truth, Monster, I think CA will be fine over the long term (eg in 2 years). This is mainly because the interests of residents and businesses are aligned: both want uninterrupted power. Although Davis has been slow, most of the main elements of a resolution to our current power problems are currently in place. The key exception being price caps. Once they are in place, negotiations can begin in earnest regarding long-term contracts between power suppliers and consumers. I’m not so sanguine about the next 6 months though.
According to Public Citizen (quoted in Extra!, 6/2001, p.24), electricity demand in 2000 was actually lower than that in 1999, at least for one 4 month period. This conflicts with the “surging demand” story which I and others have asserted on this board (among other stories). Now, frankly Public Citizen is a middling source of information. But if their numbers are valid and accurate, it would tend to strengthen the “withholding power” hypothesis.
Just an observation: there haven’t been any threads that debate whether deregulation is a good idea or not.
Finally, let’s quote SPOOFE out of context: “And what, pray tell, is so bad about a strong industrial presence?”
Gonna have to retune that rhetoric, SPOOFE. “Strong industrial presence” sounds sorta creepy. 
Reliant Energy apparently owns half of the generating capacity in the Bay Area.
When Reliant originally bought these plants from PG&E, the possibility that they might exercise market power was considered. To address this problem, the ISO (Independent System Operator - a California nonprofit corporation) signed a RMR (Reliability Must Run) contract with them. The RMR was suppose to handle situations when capacity was tight, but it was riddled with loopholes.
Some loopholes were closed. Others were not. One that remains is that the RMR applies to individual plants, not the company as a whole. And individual plants can apparently duck their obligations by -you guessed it- going off-line.
The companies therefore shut down one contracted plant as they bring another up. Then they do the reverse. Of course the companies maintain that such an odd pattern is a total coincidence.
Another stunt is to sell cheap contracted power to a middleman who re-sells it at a higher rate. Oh yeah, the middleman happens to share the same holding company as the RMR-bound generator. Another coincidence, I suppose.
The whole sorry tale is told at http://www.sfweekly.com/issues/2001-05-30/feature.html/page1.html
To any & all interested – there’s an excellent report by the CPUC that came out last year in an attempt to explain how California got into this and what might happen.
The report can be found right here.
I’d suggest downloading the PDF version. I don’t know about the status of the page since they redesigned the website and I can’t find a path from their home page (http://www.cpuc.ca.gov) to the report. If anyone has problems with the link and wants to read the report, let me know.
It’s been a while since I read it, and I really think that anyone who cares should actually read it in its entirety (70 pp. with pictures), so I’ll decline to mention the points it makes. In my opinion, it shows how one thing led to another, so that no single party is easily blamed, also that the evidence may not be clear.
Keep in mind the report is months old, and new facts & reports have come out since then. But it is a good starting point for how this got started.
Today’s Chronicle has the headline that usage is down 11% (haven’t read the article yet).
panamajack, any posting of factual sources of information which would make people actually read and think is bound to kill a thread!
Anyway, here’s from MSNBC a comparison between California and Pennsylvania:
GENERATING CAPACITY: In 1999, California’s plants had a peak summer generating capability of 53,157 megawatts of electricity, or about 1.6 kilowatts per person. Pennsylvania’s plants were able to crank out 36,627 megawatts. That works out to about 3 kilowatts per person, 87 percent more than California.
IMPORTS/EXPORTS: In order to meet supply, California imported nearly 50 million megawatt hours of electricity from Arizona, Washington and other Western states in 1999. With low snow packs and lower-than-normal hydroelectric output this summer, imports will be expensive, if they are available at all. Meanwhile, Pennsylvania had enough energy left over to sell to its neighboring states.
COST: As California’s population increases, the state must import more electricity to bolster supply. The average California resident pays $1,028 a year for electricity. Pennsylvanians pay only $830, partly because the state produces enough electricity to meet a demand that’s growing more slowly. The downside to those lower prices is higher emissions. Nitrogen oxide emissions in Pennsylvania were more than three times California’s in 1998, the most recent year for which data is available. And while there were no sulfur dioxide emissions from electric facilities in California, Pennsylvania produced 1,096,000 short tons of the pollutant.