California regulators foresee demand rising 19% during this decade

By the OGJ Online Staff

HOUSTON, Aug. 29 -- California electricity consumption is expected to rise at a slightly faster pace during the next 10 years, than in the previous decade, the California Energy Commission said in its annual forecast.

The state agency is projecting electric demand will rise about 1.8%/year between now and 2010, up from 1.4%/year in 1990-2000. But the pace is down substantially from the 3.2%/year growth in demand the state experienced between 1980 and 1990.

Peak demand is growing about 1,000 Mw/year, equivalent to the output of two large, modern power plants. Government standards for energy efficient appliances and buildings has moderated electricity consumption, but the CEC said new products are expected to boost average per capita use to 7,755 kw-hr by 2010, up from 7,442 kw-hr in 2000.

Supplying peak demand will continue to be critical, but the uneven geographic distribution of demand growth and higher demand during traditional nonpeak hours is increasingly important and must be addressed, the CEC noted. Higher growth in high-energy-using "round-the-clock" industries are expected to produce higher levels of electricity consumption.

The agency is forecasting commercial and industrial demand will grow at 2% and 2.2%/year, respectively, outpacing residential demand, which is projected to rise 1.7%/year. Commercial floor space is expected to grow at a rate of 1.5%/year, down from 2.4%/year between 1990 and 1998, while electricity use per square foot is expected to rise 0.5%/year, compared to 0.7%/year in the past decade.

In the industrial sector, decreasing use of electricity per shipment is expected to partially offset a projected 4.5% rise in shipments. The declining use per shipment is the result of a shift to a less energy intensive mix of industries, the CEC said.

The CEC said peak demand in San Diego and parts of northern California has grown faster than the state overall. Meanwhile, demand is up in the western US, creating competition for generation resources. Even if unused capacity exists, the system may not be able to deliver power where it is most needed.

It is projecting demand in the San Diego area will rise 2.3%/year in the next 10 years, down from 2.4%year in 1990-2000; 2%/year in Southern California Edison Co.'s territory, up from 1.4% year in 1990-2000; 1.8%/year in Pacific Gas & Electric Co.'s territory, up from 1.6%/year in 1990-2000; 1.1%/year in Los Angeles, compared to 1%/year in the previous decade; 1.7%/year in the territory served by Sacramento Municipal Utility District, compared to 1.6%/year in the previous decade; and 0.9%/year for other, up from a minus 0.9%/year in 1990-2000.

Growth in the Bay Area was led by the now hard-hit high tech sector, which expanded an explosive 42% over a four-year period. High tech industry also boosted the Sacramento area's electricity consumption 20% between 1996 and 2000. Growth in electricity demand in southern California was modest, remaining in the single digit range, the CEC said.

With respect to natural gas, the agency, which oversees permitting of new electric and gas facilities, is projecting supplies available to the state will increase to 7.9 bcfd within the next 20 years. California currently consumes 5-6 bcfd. The CEC said the Southwest will continue to supply about 44% of California's needs, Canada will supply 25%, with the remainder split between the Rocky Mountain and California suppliers.

It predicted the link between electricity and gas will "tighten" because all major power plants being built or under consideration will rely on gas for fuel. "The Energy Commission expects electricity generation will be the principal cause of increasing natural gas consumption in California over the next decade," it said.