U.S. Denies Northwest Power Price Cap, Approves California Cap

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U.S. Denies Northwest Power Price Cap, Approves California Cap

December 15, 2000 By KOMO Staff

WASHINGTON, D.C. - FERC, the Federal Energy Regulatory Commission, has turned down Washington's request for a West Coast cap on electricity prices.

That's bad news for the Northwest, since the prices here will still soar.

Price Cap Is Approved For California

However, federal regulators did approve a price cap for California in ordering an overhaul of California's electricity market to try to control skyrocketing prices. Those prices have pushed the state to the brink of blackouts this month.

Today's order means privately owned utilities can keep the power they generate rather than be forced to sell it on the open market. They have had to do that recently under the state's 1996 utility deregulation law.

The order allows San Diego Gas and Electric, Southern California Edison and Pacific Gas and Electric to keep the electricity they still generate.

The state Public Utilities Commission will then set the price that the utilities can charge customers.

The three utilities have been hit hard by soaring wholesale electricity prices.

The three utilities will be able to keep electricity equal to about 60 percent of what the state uses on a busy day and 90 percent on a slow day.

The federal commission also limited wholesale electricity prices to $150 dollars a megawatt hour. Suppliers offering to sell power in California at more than that price will have to defend it with FERC.

FERC is also ordering utilities to buy 95 percent of their power more than a day before they need it. The agency is also letting utilities sign contracts outside the state Power Exchange. The exchange was created by the deregulation law to oversee all power sales within the state.

http://www.komotv.com/news/story.asp?ID=8270

-- Martin Thompson (mthom1927@aol.com), December 15, 2000


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