Severe supply shortages cause California blackouts

The California Independent System Operator Monday ordered rolling blackouts throughout California because of a severe supply shortage due to forced plant outages and financial concerns of certain generators known as qualifying facilities. The blackouts are expected to last until 8 p.m. PST, the longest stretch of rotating outages ever experienced by the ISO. The grid operator called for 1,000 Mw to be curtailed throughout California.


By Ann de Rouffignac
OGJ Online

HOUSTON, Mar. 19�The California Independent System Operator Monday ordered rolling blackouts throughout California because of a severe supply shortage due to forced plant outages and financial concerns of certain generators known as qualifying facilities.

The blackouts are expected to last until 8 p.m. PST, the longest stretch of rotating outages ever experienced by the ISO. The grid operator called for 1,000 Mw to be curtailed throughout California dividing the pain among the state�s three investor-owned utilities. The blackouts started at 11:46 a.m. More blackouts are expected Monday evening as the state reaches its evening peak demand of about 30,000 Mw.

�The outages could be increased to 1,200 to 1.500 Mw,� Jim Detmers, ISO vice-president of operations, said in a conference call.

Dick Rosenbum, senior vice-president, Southern California Edison Co., said up to 140,000 customers were affected by the rotating outages between noon and 3 p.m. in Los Angeles, Orange, Riverside, and Kern counties. In all, he said, power was cut to parts of 40-50 towns, including Beverly Hills and Irvine, in the series of 1 hr outages.

He asked customers to "remain calm," take care at street corners, to walk down stairs instead of taking elevators in high rise buildings, and as a "safety precaution" not to use candles for light.

San Diego Gas & Electric Co. territory's rotating outages, lasting about 60-90 minutes each, affected 80,000 of the more than 1.2 million electric customers served by SDG&E. The company's share of the statewide electric curtailment was 74 Mw split into two blocks of 37 Mw each.

ISO officials said more than 12,000 Mw are off line because of planned or unplanned outages. Imports of electricity from the Pacific Northwest are down, compared to previous years at this time. Also contributing to the rotating outages were qualifying facilities (QF) or independent generators that have direct purchase power agreements with the utilities, said Detmers.

Detmers said of 6,000 Mw of QF generation, 2,900 Mw are off line.

Steven Kelly, spokesman for the Independent Energy Producers, said the QFs are frustrated because there appears to be no solution to their financial problems forthcoming from the California legislature. �They are at the end of their rope now,� said Kelly. �It�s been 3 months since they were paid.�

Detmers said the ISO asked some of the QFs to generate electricity, but "we were turned down. The QFs are not under our direct control."

Unlike the big merchant generators, the QFs are not under court order to produce and sell power into the California market without compensation. The California Public Utilities Commission (PUC) also stopped fining the QFs for not producing power when they are not paid.

The QFs could be off line until the credit issues of the utilities are solved. Southern California Edison Co. and Pacific Gas and Electric Co. owe the QFs $1.5 billion, according to a March PUC audit.

Some of the small renewable energy generating plants don�t have big enough balance sheets to weather long periods without compensation, explained Detmers. A group of renewable energy QFs formed a creditors' committee 3 weeks ago to push the legislature into action. But when progress on solving the QF's payment woes slowed to a standstill last week, the creditors' committee and other QFs stopped rattling sabers and started to take action.

Reportedly, Coram Energy, a small wind producer in California, is getting sufficient signatures to file for involuntary bankruptcy against Southern California Edison. Coram declined comment. Coram and the Renewable Energy Creditors Committee have hired Fleishman Hilliard, a national public relations firm, to handle press queries.

�The situation is dire for the companies,� said Jay Lawrence, spokesman for the committee and Coram. �They need to get paid.�

Contact annd@ogjonline.com

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