State feels fallout of energy crisis, producers are...eager to build...can't get the cash

SF Chronicle ^ | 4/11/04 | David R. Baker

[randita]

State feels fallout of energy crisis

Producers are ready and eager to build, but they can't get the cash

David R. Baker, Chronicle Staff Writer

Sunday, April 11, 2004

©2004 San Francisco Chronicle

On 14 windy acres at the edge of a Hayward industrial park, Calpine Corp. has everything it needs to build a power plant.

Everything except the cash.

The company already has the blessings of government officials. It has a source of fuel -- a natural gas pipeline running through the park. Water from a sewage treatment plant, literally across the street, will cool the turbines if they're ever installed.

But San Jose's Calpine doesn't have the $350 million needed to build. And banks don't want to lend the cash for new plants. In the messy aftermath of California's power crisis, the banks aren't sure they'll get their money back due to uncertain market conditions.

Calpine's project isn't the only one in question. Three years after blackouts gripped the state and Northern California's largest utility, Pacific Gas & Electric Co., filed for bankruptcy, the state's power market remains in limbo.

An all-out push to build plants at the height of the crisis added enough juice to light an additional 8 million homes. With PG&E set to re-emerge from bankruptcy Monday, the state should have enough power to weather the next two or three years.

But as the crisis eased, so did construction. And with many of California's older power plants pushing retirement age, the state soon could find itself short of voltage. Again.

"In the near future, we may have another crisis on our hands," said Michael Shames, executive director of the Utility Consumers' Action Network, a power industry watchdog group.

The state never resolved the most basic question of the crisis -- the fate of California's grand experiment with electricity deregulation. Utilities like PG&E and power generation companies like Calpine don't know what the market will look like in another two or three years.

Neither do the banks, which won't fund a new plant unless the company building it can sign, in advance, a 10-year contract to sell the power it will produce.

[randita]

Yawn.

[randita]

ping

[Ernest_at_the_Beach]

Thanks, well I would bet someone on the calpowercrisis threads thought this might happen!

[el_tigre]

Interesting thing the author said about cooling down a hot turbine with water. It would break into millions of little pieces. Normally the steam exiting the turbine is cooled down to create a vacuum effect, thereby raising efficiency.

[Ernest_at_the_Beach]

Well this reporter found "Loretta..." Imagine that:

Loretta Lynch, a member of the state PUC, said some of the plants that aren't being built probably shouldn't be.

And she is calling for renewable energy sources....

[Ernest_at_the_Beach]

Reporter likely no versed in power plants...

[Ernest_at_the_Beach]

no ....should be..... not!!!

[Extremely Extreme Extremist]

It's nauseating listening to California liberals who blame the free market for their energy crisis.

[Carry_Okie]

But San Jose's Calpine doesn't have the $350 million needed to build. And banks don't want to lend the cash for new plants. In the messy aftermath of California's power crisis, the banks aren't sure they'll get their money back due to uncertain market conditions.

Not when they can make a bucketload refinancing electricity purchases against the resulting shortages.

What a crock. With interest rates the way they are, this is a slam dunk.

[tubebender]

Calpine bailed out of the $1,000,000,000.00 LNG terminal and generating plant here on Humboldt Bay after the NIMBYs shouted them down...

[snopercod]

Not to worry, the LNG plant in Ensenada,BC is coming along nicely.

[snopercod]

I predict Gray Davis will get a job at SCE.

[Carry_Okie]

Board of Directors.

[upcountryhorseman]

Let's get real! fuel cells, solar, wind turbines are not
going to replace fossil fuels any time soon (if ever).
Cut the regulations and the power of enviromental whacko's
so we can build some power plants and oil refineries in
California.

[SierraWasp]

You have clearly stated the absolute, unvarnished TRUTH!!!

[Willie Green]

You have clearly stated the absolute, unvarnished TRUTH!!!

Asia spends billions on nuke technology
Cheney to Promote American-Made Nuclear Reactors to China

[biblewonk]

Fuel cells and solar won't but wind sure will. It reached 40gw installed power last year adding 8.2 gw in 03. The price comes down each month and within about 5 years it may not need the PTC at all. Wind power sells for less than the fuel price of gas fired power plants.

[snopercod]

...the $350 million needed to build...

That's just the cost of the plant itself. The permits, fees, studies, surveys, etc. come to several billion more.

[snopercod]

Good for the balance of payments!

[SierraWasp]

BULLETIN! BULLETIN! BULLETIN! 2:57pm 04/12/04

Brief power outage at LAX tower delays flights ($XAL) By August Cole

SAN FRANCISCO (CBS.MW) -- About 100 flights at Los Angeles International Airport were affected by a power outage Monday at the airport's control tower, according to the Associated Press. The electricity, which went out at 9:40 a.m. Pacific and was back up around 11 a.m., was knocked out by power surge, the news agency said. The Amex Airline Index ($XAL) fell 0.9 percent.