By the OGJ Online Staff
HOUSTON, Apr. 11--Terry Winter, CEO of the California Independent System Operator, said Pacific Gas & Electric Co.'s bankruptcy reorganization filing introduced a new element of uncertainty with respect to maintenance and investment in the transmission system at a time the grid operator is already struggling to maintain reliability.
Winter addressed the California House Committee on Government Reform Tuesday.
"We literally are in uncharted waters," he said. "It is the first [bankruptcy] of this scale and represents for the first time that the debtor in possession will not have available to it sufficient generation capacity to serve its customers."
Winter said he expected the bankruptcy court to allow the utility to keep its transmission system and generation capacity maintained in a manner "consistent with good utility practice."
Besides maintenance, the ISO is particularly concerned about the impact of the bankruptcy on needed investments in the transmission system that range from modest upgrades of existing facilities to building new transmission lines. Transmission bottlenecks play a big part in the state's energy crisis.
"The ISO has identified no less than 170 such projects as necessary to maintain reliability on the PG&E network over the next 5 years," he said.
He noted that constraints on the so-called Path 15, a transmission corridor that transports electricity generated in the south of California to the north, was a primary cause of recent rolling blackouts in the state.
Completing the identified transmission projects will also ensure that the regional system is connected adequately with neighboring states. California needs adequate access to new power supplies in a wider region, he said.
He emphasized to legislators that the California energy crisis is not only a supply problem but also a transmission problem. Winter fretted that delaying the transmission projects will keep the problem from being solved and impair regional reliability and efficiency.
"Will the bankruptcy court with its traditional focus on maximizing the value of the debtor's estate, recognize the criticality of allowing these investments to go forward?" Winter said.
