Gino DiCaro

Report Warns of Tight Power Supplies

By Gino DiCaro, VP, Communications

Capitol Update, Sept. 24, 2004 Share this on FacebookTweet thisEmail this to a friend

A recent draft report by the California Energy Commission warns of future energy shortages if action is not taken soon to attract new energy investment.

If a number of older power plants retire and additional resources don’t come on line before 2008, electricity reserve margins could become dangerously thin, according to a draft update to the CEC’s 2003 Integrated Energy Policy Report.

Since the 2001 crisis, nearly all of the new power plants slated for construction have been postponed or canceled due to a combination of factors: low wholesale electricity prices, the Enron scandal, regulatory uncertainty and reluctance by Wall Street to finance new electricity generation projects.

Bringing more power online is a task as important as any facing California today. An important first step to increase investment in new generation is a robust and competitive wholesale market. A healthy wholesale market will increase investment in new generation and lower energy costs for both bundled utility and Direct Access (DA) customers. The way to accomplish this is through a competitive wholesale procurement process as provided in AB 57 (Wright, Ch. 835, Stat. 835). The California Public Utilities Commission is presently implementing AB 57, with several resource adequacy and procurement proceedings currently underway.

Download report
Read more Energy articles

Capitol updates archive 989898989