Skip to comments.(Cal PUC)Ruling may pull plug on peak power plan
Posted on 03/30/2005 3:25:32 PM PST by Robert357
A controversial plan to slap sky-high electric rates on large power consumers to encourage energy conservation during key times this summer should be postponed, an administrative law judge has ruled.
The California Public Utilities Commission judge reviewing so-called critical peak pricing plans from San Diego Gas & Electric and two other large utilities concluded there was insufficient time to implement the programs this summer.
The judge, Michelle Cooke, instead suggests considering similar plans for next year or 2007 as part of a comprehensive rate redesign.
At the earlier urging of the commission, SDG&E had presented a proposal to triple rates for the largest consumers of power during peak demand periods, bringing rates to twice the highest seen, including during the state's power crisis of 2000 and 2001. These large consumers have advanced meters that allow for time-sensitive rates.
By discouraging power use during the critical periods, SDG&E concluded that the region's peak power demand would be reduced by about 28 megawatts. The region's all-time record usage was reached last summer at slightly more than 4,000 megawatts.
SDG&E had also proposed to lower rates during noncritical periods this summer, so most customers would see little change in their total electricity costs during the summer.
The judge's proposal is subject to approval by the PUC. Commissioners are scheduled to vote on it at an April 21 meeting, after a comment period.
The proposal has triggered protests from large power consumers, including Wal-Mart, J.C. Penney and Costco. The retailers and others said there was not enough time to prepare for the new rate plans and argued that the high peak rates would be punitive without providing the demand reduction needed during periods when supplies are likely to be short this summer.
The San Diego Regional Chamber of Commerce is hoping the delay is approved.
"We are delighted with the proposed decision," said Mitch Mitchell, vice president of public policy for the chamber. "We believe the critical peak pricing plan sends a very bad message to the largest power consumers. There are alternative plans for the PUC to consider and hopefully they will do so now."
A spokesman for SDG&E said scrapping the critical peak pricing program for this summer would have little impact on the utility's preparation to ensure adequate power supplies for this summer.
Utility spokesman Ed Van Herik said the company has an array of conservation programs and peak power-shaving plans in place. SDG&E has also secured additional supplies, including a new small power plant that is expected to be ready for this summer. The utility believes it can meet expected demand this summer, barring unusual events.
Michael Shames, executive director of the Utility Consumers' Action Network, said the group supported plans to scrap the critical peak pricing plan. Shames said existing conservation and peak shaving programs appeared to be working well. He said that given recent forecasts that supplies should be adequate to meet normal summer demand, the critical peak rates could not be justified.
But Shames also noted that protests over plans to implement the high rate plan were a preview of what's to come when SDG&E proposes time-of-day rates for all customers as part of its proposal to install advanced electric meters for all customers.
The PUC had earlier asked SDG&E and the other utilities to formulate the plans for large power consumers to avoid potential electric shortages this summer, when extraordinary heat could push demand beyond supply.
In response, SDG&E presented a plan that would have been triggered whenever the temperature at the Miramar Marine Corps Air Station was 84 degrees or warmer, when total area demand exceeded 3,620 megawatts or when emergencies arose. A megawatt is sufficient to power about 1,000 homes.
The local utility's proposal would have tripled electricity costs during key hours for the largest commercial customers, which include those using as much or more power than supermarkets or big-box retail stores.
This sounds like a lot of economic harm for a 0.7 percent reduction (28/4000) in peak load.
My recommendation would be watch out what might be in the works for this summer when it comes to electricity.
This water year is looking like the 43rd worst year for flow in the Columbia River power system in the past 45 years.
The following shows the cumulative percipitation (read that the amount of hydroelectric power that California may be able to get from the Pacific Northwest.
While its kind of early to think about summer power outages, I thought that you might enjoy the following post.
Sort of like cities deciding that they need to reduce the parking associated with commercial developments and appartments to "encourage" use of public transportation.
Socking it to the "rich" or high users seems to be a common thread of many politically correct groups. It doesn't matter if it is electricity, gas, or parking spaces. Unfortunately the "rich" can afford it, while other folks can't. That sort of tells you who really gets hurt in the end.
As opposed to a rebate program for people to install timers on electric water heaters.
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