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Calif. Adds Big Calpine Plant to Growing Power Fleet Nigel Hunt Reuters - June 17, 2002

LOS ANGELES -- The largest new power plant to come on line in California in 16 years was due to be officially opened on Monday, helping to diminish the threat of blackouts this summer despite concerns about growing energy demand.

California Gov. Gray Davis was due to open the 880 megawatt Delta Energy Center in Pittsburg, the second major plant to be opened in the San Francisco Bay Area during the past 12 months.

One megawatt is roughly enough power for 1,000 homes.

San Jose, California-based independent power producer Calpine Corp announced earlier Monday that the natural gas-fired facility had begun commercial operation, its third major new power plant in California during the last 12 months.

"The fact that it is in the Bay Area is a big deal. That is an area which is still a concern to us both from a generation standpoint and a transmission standpoint," said Gregg Fishman, spokesman for the California Independent System Operator (ISO) that controls most of the state's power grid.

The San Francisco Bay Area was among the areas hit hardest by rolling blackouts last year due to a lack of high-voltage transmission lines needed to import power during emergencies.

"Every megawatt coming on line is important to California's overall electricity balance, this plant particularly as it is in Northern California which has more problems getting electricity," said California Energy Commission spokeswoman Susanne Garfield.

Fishman said over the past 18 months about 4,300 MW of new plants had come on line, including the Delta Energy Center.

"That increase goes a long way toward making this summer a little easier to handle," he said.

California suffered six days of rolling blackouts between January and May 2001.

There were forecasts it faced the prospect of hundreds of hours of blackouts during the summer when demand normally peaks due to heavy use of power hungry air conditioning systems.

SEEKING BALANCE
Last summer, however, turned out to be blackout-free due to a major conservation drive, a sluggish economy and new power plants.

The first major new power plant in 13 years was opened in late June 2001, the 320 MW Sunrise facility near Bakersfield in central California. The plant is operated by Edison Mission Energy, a unit of Edison International .

Calpine followed in early July by opening the 540 MW Sutter Energy Center in Yuba City and the 555 MW Los Medanos Energy Center in Pittsburg.

The California ISO in April issued a summer assessment report for 2002 which said that the state should have enough power to meet its needs boosted by the new plants and improved output from massive hydropower dams in western states.

Fishman warned, however, that actual loads had recently been running above those recorded on days with similar temperatures last year, noting that conservation had been a key factor enabling the state to escape blackout free last summer.

"We may have seen a drop off in conservation or quite possibly some economic turnaround. Most likely it is a combination. It is a cause for concern," he said.

Figures issued by the California Energy Commission showed the peak demand in May this year was around 3.9 percent above May 2001 although still 6.9 percent below May 2000 levels.

The only other major new power plant expected to come on line in California this year is the 1,121 MW La Paloma gas-fired plant in Kern County. PG&E Corp unit PG&E National Energy Group is building the plant and said last week it was expected to begin operations in "late 2002".