Blackouts Droughts*

May 16, 2001

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Power-Grid Overseers Predict

More Blackouts in California

By JOHN J. FIALKA

Staff Reporter of THE WALL STREET JOURNAL

WASHINGTON -- The lights will go out in California more often this summer than energy planners there anticipate, and power-plant operators in the Pacific Northwest may have to conduct rolling blackouts next winter unless Western drought conditions ease.

That is the outlook of the consortium of private utilities and government agencies that oversees the nation's power grid, in what the group is calling the "worst" forecast of U.S. electricity supplies ever issued. The North American Electric Reliability Council, formed following the great 1965 Northeast Blackout to assure the reliability of the nation's electric grid, issues annual power-supply predictions to alert the public to potential problems.

The Princeton, N.J., council issued a special assessment of future power needs Tuesday, noting that California has underestimated drought-related weather problems affecting its hydroelectric dams and overestimated available power supplies from other generators.

New York City and New England, two areas of the country where power problems have been a concern, should be able to weather the summer, the group said, if local power officials take adequate steps.

The upshot of the NERC report is that Californians may have to endure as much as 260 hours of rolling blackouts -- outages with little warning that shut down industries, paralyze traffic-control systems and stop air conditioners. Earlier state projections ranged from 55 to 200 hours of blackouts, but NERC's study noted that they were based on "normal" weather patterns without taking the drought into account. The state also took a "somewhat optimistic" view that its already worn power equipment would escape major breakdowns during the high summer demands.

According to the council, the state's summer peak power deficits will be between 2,000 and 4,000 megawatts higher than the California Independent System Operator, which manages power systems in the state, had earlier predicted. That is roughly the output of two to four large power plants.

Stephanie McCorkle, a spokesman for the California ISO, said it was still analyzing the council's report. "We're not ready to comment on it."

Because the reservoirs and streams that power the state's hydroelectric dams are running at 55% of average capacity, they will generate for only a few hours during peak demand periods, according to the report. The report assumes that new higher electricity prices and state conservation programs under preparation will lower California's peak electricity demands by about 1,250 megawatts.

Because the drought covers the entire West Coast, the report says Pacific Northwest generators will not be able to provide as much help as California anticipated this summer. NERC also projects that unless the drought eases, "energy shortfalls are likely for winter 2001/2002" in the Northwest, where, unlike California, peak demand occurs in December and January.

"Normally we would be looking for electricity imports from California in the winter," said Jerry Rust, a spokesman for the Northwest Power Pool, a group of major utilities. "This year we're not anticipating available power in that time frame."

Two-thirds of the electricity in the Pacific Northwest comes from hydroelectric power, but the Columbia River basin is suffering from its lowest water levels since the summer of 1937, with reservoirs averaging about 53% of normal. Because the water is being carefully rationed, "periods of even moderately above-normal temperatures" could even trigger blackouts this summer, NERC states.

Tony Usibelli, an energy specialist with the state of Washington's Office of Trade and Economic Development, said the NERC forecast was "a reasonable assessment." Area energy planners, he said, are predicting a 1-in-5 chance that there will be some form of shortage next winter. "Whether it translates into rolling blackouts or not is uncertain, but some form of supply disruption could happen."

Regarding other parts of the country, the council predicts New York City will likely install enough new generation to avoid blackouts and says power supplies in New England will be "tight," but adequate, with the addition of new generation and more hydroelectric power imported from Quebec. NERC officials said they are also monitoring Texas, which has sufficient power, but could face adjustment problems when it switches from independent power suppliers to a single supply control system in June.

Write to John J. Fialka at john.fialka@wsj.com

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