Ann de Rouffignac
OGJ Online
HOUSTON, Feb. 14�The California Electricity Oversight Board�s summer forecast for electricity supply and demand predicts the state will avoid blackouts this summer. But a forecast by the California Independent System Operator (ISO) projects July supply shortages at a staggering 4,600 Mw and expects rolling blackouts on numerous occasions. And a third forecast by Cambridge Energy Research Associates shows the state short 3,000 Mw at peak and expects 20 hrs of rolling blackouts this summer.
The oversight board, appointed by the governor, found the state lacked 4,966 Mw. But that number is predicated on several assumptions.
The board assumes that plant outages run at historic averages of about 3,050 Mw at any one time and also that the state is able to import a full 4,834 Mw from out of state including the drought-stricken Pacific Northwest. Officials with Bonneville Power Administration, which controls about 11,000 Mw of hydroelectric power in the Northwest and sends power to California on a routine basis, say water reservoir levels are about 50% to 60% of average. BPA is short 3,000 Mw to serve its own firm contracts, says Steve Wright, BPA executive director. BPA expects to have little surplus power to send to California unless the dry weather conditions change.
Plant outages in California are running 250% above average, according to the California Energy Commission. Most observers agree that the extreme number of outages will not be fixed until the credit problems of utilities that can�t afford to pay for power are fixed. But the fleet of power plants in California is aging and plant operators are running 30-year-old-plus plants around the clock. The older plants will necessarily break down and require maintenance more often when pushed this hard. The oversight board�s estimate of 3,050 Mw of outages for July may be optimistic.
Another difference that accounts for the more optimistic oversight board forecast is a higher number for installed capacity. The board says the ISO control area has 45,025 Mw of installed capacity compared with ISO estimates of 44,050 Mw. The 1,000 Mw difference is attributed to the age of some of the power plants. Many units are no longer producing at their nameplate capacity. Some have been derated or no longer produce at maximum output, says Patrick Dorinson, spokesman for the ISO.
The three entities agree that demand is outstripping supply but the state�s oversight board is optimistic that 5,053 Mw of additional generation will be in place by July to make up this deficit.
The state identifies an extra 1,000 Mw of new emergency peaking facilities in addition to the 1,133 Mw of peaking plants expected to be online by June and already under contract with the ISO.
ISO officials say they are not familiar with the 1,000 Mw identified by the Electricity Oversight Board.
Other generation supplies identified by the state include 1,262 Mw approved by the California Energy Commission and expected to be online by July, 1,244 Mw of thermal and renewable projects to be restarted, and other smaller upgrades. The new generation and expansion of existing facilities total 5,053 Mw, making up for the deficit of 4,966 Mw, according to the oversight board.
CERA�s forecast of a 3,000 Mw deficit and at least 20 hrs of rolling blackouts assumes economic growth of only 1.5% and 80% availability of hydroelectric resources, Daniel Yergin said at its energy conference in Houston Feb. 12.
Joe Bob Perkins, president of Reliant Energy Wholesale Group (which owns 4,000 Mw of generation in the California market) noted that hydroelectric resources were running 40% to 60% of average output, not 80%. He also said CERA�s estimate of economic growth that translates into additional electricity demand was unusually low.
�You would have to look back real far to find that small a growth in California,� he said.
Perkins expects more than 20 hrs of blackouts.
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