Posted on 09/29/2002 12:35:19 PM PDT by Ernest_at_the_Beach
Edited on 04/14/2004 10:05:33 PM PDT by Jim Robinson. [history]
The Laguna Hills resident is professor of economics at Pepperdine University & author of "Capitalism: A Treatise on Economics."
The state Public Utilities Commission last week announced that the cause of California's numerous electric-power blackouts of recent years was the deliberate, malicious withholding of the use of available power-generation capacity by the major power-producing companies.
(Excerpt) Read more at 2.ocregister.com ...
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While totally ignoring any discussion on grid reliabilty.
by foregoing available income today a company would incur a loss, but if it meant a higher price in tomorrow's auction, it might still be rational to forego that income today.
To continue the author's restaurant analogy--a restaurant could turn away customers and keep the food in the fridge until tomorrow gambling that the same hungry customers it turned away today would come again tomorrow willing to pay a higher price for the same food that instead of being prepared today, is kept cold until it can be prepared and sold tomorrow for a higher price. The restaurant doesn't take a loss on its inventory. But what if the food is perishable and must be sold TODAY to meet demand or else it must be tossed in the waste can? Would it make good sense for the restaurant to turn away the hungry customers it has food for, then throw the food it would have served in the waste can?
Of course not, but that is what the PUC expects the public to believe the power companies did. If a power company has the means to generate more power and sell it TODAY, it is sheer stupidity not to do so, because you've lost that sale forever. Power cannot be generated and stored and there's no guarantee whatsoever that you could make up the loss of not selling power when you had the chance.
The PUC certainly has a low estimation of the intelligence of CA citizens, but if those citizens buy the malarkey fed them, perhaps that low estimate is justified.
There are more than a few CA Freepers who don't buy this bunk, thank goodness.
Sorry, but this is just letting enough time go by that the freshness and outrage of the Enron scams has faded a bit from memory. So now, lets start spinning again and get that golden money train back on track. They are really completely confident that people are stupid.
Thursday, December 14, 2000
By Chris Knap, The Orange County Register, Calif.
Power-plant operator AES Corp. will pay a record $17 million penalty as part of a settlement of charges that the company pumped 700,000 pounds of illegal emissions into Southern California's air.
Regulators at the South Coast Air Quality Management District called AES' violation the "most egregious case in the agency's history."
"This is the single largest violation of emission limits the staff is aware of in the last 25 years," AQMD Executive Officer Barry Wallerstein said Wednesday.
Under the settlement AES will pay a $17 million penalty by July 1; install pollution controls on its three Southern California plants; operate the cleanest units at its power plants first and the dirtiest only in emergencies; and either purchase emission credits as needed to make up for this year's excess or have credits deducted from its 2001 allocation.
[snip]
Aaron Thomas, manager of the AES subsidiary that operates the plant, called Wallerstein's characterization "unfortunate" and said the company was not able to successfully juggle competing pressures from the AQMD and the state's power-grid operator.
Also, the PUC did not consider directives from the CA ISO to ramp down because of grid overload. The PUC report is nothing more than a political document. It has little basis in fact.
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