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No Watts from California by Chris Mulick, Herald staff writer Tri-City Herald, January 13, 2001

Anyone still harboring hope the power-sapped Northwest will get help from the south this winter had their hopes dashed against the California shoreline Friday.

Typically, California sends electricity north to cover power demand peaks in the winter and in turn receives northern imports to feed air conditioners in the summer.

But the three West Coast governors said Friday after a meeting in Sacramento that California won't have excess power to ship north this winter beyond existing agreements for power swaps with the Bonneville Power Administration.

"We hope to resume that relationship next winter," California's Gov. Gray Davis told Western reporters via conference call.

Power analysts, who annually assume California imports will be available, already had seen the writing on the wall.

"We have been planning on this basis," said Dick Watson, director of the power planning division for the Northwest Power Planning Council. "We would typically assume there would be some power to get out of California. Our study we did last year explicitly assumed there would be. That's an assumption that doesn't hold true."

It's been a lousy start to a winter that is only a few weeks old. Not only can the Northwest expect little in the way of imports from the south, dry conditions have produced less water than normal to spin turbines at Northwest hydroelectric dams.

Early projections indicate winter precipitation will be only 75 percent of normal. Water levels behind Grand Coulee Dam are the second-lowest for this time of year since 1975. Only in 1989 -- when the region teetered on the brink of energy shortages throughout February -- were levels lower.

"Pray for rain," is how Watson put it to the Washington state Senate Environment, Energy and Water Committee this week.

Blackouts have been avoided up and down the West Coast, but only after power-guzzling factories were closed because of high power prices, putting thousands of workers on the street. Also, consumers have voluntarily sacrificed through energy conservation measures.

Environmental protections concerning fish recovery and air emission limits from power plants also temporarily have gone by the wayside at different times.

The Northwest will be fine if temperatures remain moderate. But a prolonged cold snap could put the Northwest in peril -- unless heavy rains fill reservoirs and wash out the worries.

California came as close to blackout conditions as it has throughout the crisis on Thursday, when stormy weather arrived as power plants producing a combined 15,000 megawatts -- enough to light more than 10 cities the size of Seattle -- were shut down for maintenance.

Kellan Fluckiger, chief operating officer for the state agency that runs the California power grid, called it "as exciting a day as we've ever had around here."

He assured skeptics the supply shortages are legitimate. Some suspect the crisis is being partially manufactured by members of the California Independent System Operator's governing board who stand to benefit from high power prices.

"There is no crying wolf here," Fluckiger said. "Emergencies that we talk about are real."

Davis, Washington Gov. Gary Locke and Oregon Gov. John Kitzhaber tried to put up a unified front Friday afternoon in an attempt to assure Western residents California is doing all it can to conserve. Davis said his state will exceed the 10 percent conservation mark that Locke and Kitzhaber have asked of residents in the north.

"People outside the region don't understand the strong conservation measures California is taking," Kitzhaber said. "I'm impressed with what's going on down here."

The governors also called for federal price caps throughout the region and hope to make their case for caps at an energy conference in Portland on Feb. 2.

Wholesale energy prices on the spot markets have routinely topped seven times or more what they are normally. This has driven two of California's three largest utilities to rack up combined debts of more than $9 billion, pushing them to the brink of bankruptcy.

At the same time, the companies' credit has plummeted, making it more difficult for them to buy power from sellers, including ones in the Northwest, because they worry they won't get paid.

"Clearly, we need a timeout," Davis said. "We need an opportunity for the markets to stabilize."

Meanwhile, California plans to buy power through more affordable long-term contracts for resale to utilities. Davis said he will reveal more details next week.

"I expect to solve this problem in 90 days, and in six months this will be a very distant memory," he said.

It had better be. Analysts already are bracing for what could be an even more brutal summer in the West this year than last.

Though California has much blame to carry for what Locke called the state's "miscalculations of deregulation" and for not building more power plants, Watson said the Northwest also is partially at fault.

"We haven't built diddly squat the past several years," Watson said. "There's blame to spread around here."