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Feds Order Northwest Power to California by Al Gibbs, Staff Writer The News Tribune, December 14, 2000

TACOMA: Utility puts on hold 86% surcharge plan

Six months after an electric power crisis began on the West Coast, the federal government is taking steps to halt it.

Energy Secretary Bill Richardson on Wednesday ordered generating stations in the Northwest to send power to battered California markets, and the Federal Energy Regulatory Commission was considering price caps in energy markets all along the West Coast.

"I think it's very likely they'll try to do something soon," said Phil Moeller, energy aide to Sen. Slade Gorton.

News that Richardson had invoked emergency clauses in the Federal Power Act after a meeting with California officials came during a day when:

* Tacoma's Utility Board delayed action after a hearing on a proposed surcharge that would boost residential customers' bills by 86 percent.

* Two giant California utilities - Pacific Gas and Electric and Southern California Edison - said they face bankruptcy from paying skyrocketing prices of both electricity and natural gas. Their financial problems were one of the reasons Northwest utilities were reluctant to sell power there, fearing they wouldn't be paid.

* Northwest utility officials questioned whether the region has any surplus power to spare because months of drought have dropped hydroelectric reservoirs to lower-than-normal levels.

The Bonneville Power Administration, however, said it would send 1,750 megawatts to California for a few hours Wednesday evening and could export the same during today's peak demand times without threatening endangered salmon and steelhead in the Columbia basin.

"This is not going to significantly affect operations," said Bonneville spokesman Mike Hanson.

Utilities like Tacoma Power and Puget Sound Energy weren't affected by Richardson's order.

"We can't order anybody to do anything," said Rich Nassief, executive director of the Northwest Power Pool, which coordinates energy exchanges in the region.

The possibility that the Federal Energy Regulatory Commission might impose price caps on West Coast markets caused Tacoma's Utility Board to delay action on proposed surcharges to its customers, especially residential consumers whose bills could rise by 86 percent before the end of the month.

The impact of federal price controls "would be hard to say" without more information, said Tacoma Power chief Steve Klein.

"But we'd look for any opportunity to temper" proposed increases.

More than 100 people turned out for a Tacoma Public Utilities board meeting to protest its proposed rate increase. Critics warned of people who would go cold this year because they couldn't pay more for electricity; complained of businesses that kept lights and signs on all night despite the need to conserve energy; and argued that companies might go out of business and lay off workers, making the problem even worse.

"We cannot afford this increase," said Rachel Bennett of Tacoma. "We don't qualify for welfare, but we can't pay our bills."

Peter Ansara, director of the Tacoma Housing Authority, said the surcharge would cost the authority $851,000 in extra power charges - money the agency doesn't have.

"We're in a great dilemma," he said.

Former City Councilman Dick Sonntag said he felt the city's utilities department had become a "bit arrogant."

"We need this agency to understand that we own it, and that this huge increase ... before Christmas is wrong," Sonntag said.

The board put off action on imposing surcharges until early next week.

Tacoma Power is seeking more revenue because it has had to purchase power on the high-priced open energy market to preserve water in the rivers that power its hydroelectric dams, especially the Cowlitz.

While other rivers around the region held about two-thirds of the normal amount of water for this time of year, the Cowlitz only had one-third of the normal amount.

The reservoir was about 50 feet below historic averages.

The region's months-long drought has brought rivers to the 10th-lowest levels in the 72 years that records have been kept.

"And the forecast for December is bad," said Bonneville spokesman Mike Hanson.

Other utilities face the same problems of generating enough electricity to serve customers while preserving enough water to continue operations until the spring snow melt.

Water was flowing into the reservoir at Seattle City Light's Ross Lake at a rate of about 300 cubic feet per second Wednesday, according to spokesman Dan Williams.

But 4,000 cubic feet per second was flowing through the dams generators.

"It's the beginning of winter," he said, "so there's some hope we can pull out of it."

"But it's bad, no doubt about it."