States locked into grid face severe energy test

By William Booth Washington Post Staff writer Sunday, January 28, 2001, Page A03

For fair use- educational purposes only

LOS ANGELES, Jan. 27 -- Power managers across the West are warning that the regions's entire electric system is under severe stress, and that high prices and tight supplies of energy are likely to burden many western states for months.

The most immediate cause of the West's power shortages and steep rate hikes is the meltdown of California's partially deregulated and dysfunctional energy market.

But the long-term problem is this: Supply and demand are unbalanced throughout the region.

The western power grid -- the public-private system that generates electricity and delivers it through transmission lines to consumers -- is overtaxed because of the energy needs created by a booming economy and explosive population growth. The grid is also suffering from a dearth of new power plant construction and a neglect of conservation measures.

"We're all in this together," said Oregon Gov. John Kitzhaber (D). "We cannot afford to let California go down the tubes."

But it is not only California that needs help. While many voices in Washington, D.C., and the West depict California as an electricity hog, in fact most of the increased demand for electricity comes not from California, but from other western states.

About 85 percent of the growth in electricity demand in the last five years in the 11 states of the West has occurred outside California.

Although companies in California have not constructed any major power plants in the last 10 years to meet the state's increasing needs, another point on which the state is criticized, neither has the Pacific Northwest, which has not finished a power plant since 1993.

"Is the California crisis contributing to our supply problems up here? I think not," said John Harrison of the Northwest Power Planning Council, a four-state compact formed by Idaho, Montana, Oregon and Washington that oversees energy planning and wildlife recovery in the states' waters.

"Our supply is extremely tight, too," Harrison said. "We haven't been building any new power plants either."

Most experts agree, however, that the increased costs for power have been caused in part by California, which has been paying extremely high prices on the spot market for wholesale electricity to keep state officials from instituting rolling blackouts, a panicky buying strategy that drives up prices for everyone.

California, Oregon, Washington, Idaho, Montana, Wyoming, Colorado, Nevada, Utah, New Mexico and Arizona are joined together in one enormous power grid. They are so interdependent that the breakdown of a generator in Spokane, Wash., can cascade into a shortfall of power in San Bernardino, Calif.

"We are, quite literally, interconnected," said Ralph Cavanagh, director of energy programs at the Natural Resources Defense Council in San Francisco. "States are just imaginary lines on a map. The grid is what is real."

The current crisis of the "interconnected West" is being exacerbated by a winter that has produced only a drizzle of rain and snow. Precipitation is crucial because so much of the region relies on water to turn the turbines on the hundreds of hydroelectric dams across the West.

While California scrambles to keep the lights on, the managers of the West's power grid are looking to the sky. And they do not like what they see.

"We are looking at a critical shortage of water," said Ed Mosey of the Bonneville Power Administration, a federal agency that oversees electricity sales from 29 dams in the Columbia River Basin, a powerhouse for energy in the Pacific Northwest that serves 10 million people and has been a major exporter of electricity to California during the current crisis.

Mosey points out that a snowflake that falls in the upper Columbia River Basin in northeast Washington state is viewed by energy managers as a resource, as valuable to them as a dollar in the bank.

That snowflake eventually melts and drains into the Columbia River and is held in storage in the Franklin D. Roosevelt reservoir. When power is needed, the water is released, and each time it passes through a dam's turbines, it generates kilowatts that are distributed through the grid to homes and businesses throughout the Western United States.

The Pacific Northwest relies on hydroelectric dams for about 75 percent of its power; 20 percent of California power is hydroelectric energy. To make matters worse, the northern half of California, including the Bay Area and Silicon Valley, is even more reliant on hydropower.

Jeff Cohen of the California Department of Water Resources reports the state currently has only about half of the historic average of rain and snow. In a normal year, California would have 24 inches of precipitation; for the year to date, it has received only about 12 inches.

In the Pacific Northwest's Columbia River Basin, an area encompassing most of Washington, Oregon, Idaho and western Montana, snow and rainfall are also about half of the historic average. One of the Northwest's largest reservoirs is at a 25-year low.

The water that turns the turbines also performs another crucial task: It supports the once-vast migrations of salmon and steelhead in the Northwest. Now that a dozen of these species are listed as threatened or endangered, the dam's operators are faced with difficult choices: to keep generating power or to save the fish.

For decades, California has sold its surplus electricity to heat homes in the chilly Pacific Northwest during the winter. Likewise, the Northwest has shipped its extra power south in the summer to run sunny California's air conditioners.

This arrangement allows the Northwest to store water in its reservoirs as the snows fall in its mountains. But not this year. With the exception of long-term commitments already in place, California is not sending power north this winter. What will happen this summer is the stuff of nightmares for power managers in California.

"We've never had this condition occur in the winter before," said Claudia Chandler of the California Public Utilities Commission. "California has always been a net importer of electricity. But we need it for our peak demand during the hot summer afternoons. Not in the winter. In the winter, we ship north. That's the way the system evolved."

Indeed, while California may be a net importer of electricity, so too is the Pacific Northwest. In an average year, California imports about 20 percent of its power from out of state. The Pacific Northwest imports 8 percent, mostly from California.

These realities, however, have not eased the feeling among many political leaders around the West that California is to blame for creating the current mess.

For example, Sen. Larry E. Craig (R-Idaho) argues that Idaho should defy any federal order to supply California with energy if such an edict would damage his state's resources.

"I don't want California, because of its lack of foresightedness, to take our water and put our ratepayers in jeopardy and, of course, risk the movement of our fish downstream," he said.

As California officials scramble to find long-term solutions to the energy crisis, congressional representatives from the Pacific Northwest urged Gov. Gray Davis (D) to step up his efforts.

In a letter to Davis drafted by Rep. Jay Inslee (D-Wash.) and signed by eight other representatives from Oregon and Washington, the legislators expressed a willingness to cooperate with their neighbor but requested that California guarantee to repay their states in case its utilities declare bankruptcy.

Inslee added that Californians are not alone in having to pay higher utility bills; some of his constituents have seen their rates double recently.

There are also steep rate increases in the works or already in consumer utility bills in Idaho, Utah, Oregon and Montana.

"There is an instinctive desire to help our friends in California," Inslee said. "We just want some insurance that we're not left holding the bag for any insolvencies."

Special correspondent Jeff Adler contributed to this report.

© 2001 The Washington Post

-- Swissrose (cellier@azstarnet.com), January 29, 2001