Plants closed for maintenance more than before power crisis

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The Associated Press

LOS ANGELES – The frequency of temporary closures of California power plants for maintenance and repairs has increased as much as four times since electricity prices began to rise last summer.

The figures released this week by the state Energy Commission bolster critics’ suspicions that energy companies were shutting down the plants to manipulate the market, the Los Angeles Times reported in its Saturday edition.

“It was about May of last year that they saw they had some market power by withholding power,” said Rob Schlichting, a spokesman for the Energy Commission. “I’m sorry, I find it hard to believe this is all because they’ve had breakdowns, or they had maintenance they had to be doing.”

Statistics reveal that the amount of electricity kept on the sidelines by suppliers because of repairs and maintenance continued to grow, reaching a peak in April when the amount offline was 350 percent higher than in April 2000. Last month, the average amount offline was 14,990 megawatts, about one-third of the state’s load, according to the commission’s figures.

Wholesale electricity prices have increased over the past year from about $30 per megawatt-hour April 2000 to about $2,000 per megawatt-hour this April.

Energy companies defend the plant closures because the generators have been running longer periods during the power crisis.

“We’ve been running them flat out,” said Tom Williams, a spokesman for Duke Energy Corp., which owns four power plants in California. Duke and other wholesale suppliers bought power plants from the state’s utilities when California deregulated its energy market.

The commission figures show that during the first four months of 2000, when electricity prices were flat, energy companies closed their plants less often than in 1999. A spike in natural gas prices one year ago sent electricity rates sharply higher. At the same time, plant closures went up by 32 percent from the same period the year before.

The increase of plants shutting down continued to grow, averaging more than 200 percent during the latter part of 2000 when there were repeated threats of rolling blackouts.

Energy companies said the dramatic increase the first four months this year – up to 350 percent last month – was due mainly to state grid operators ordering them to delay routine maintenance.

Also contributing to April’s low energy reserves were the partial closures of the San Onofre and Diablo Canyon nuclear power plants that deprived the state of more than 2,000 megawatts.

Consumer rights groups infuriated about taxpayers paying more for electricity said deregulation fostered the current problems.

“In a sense, this is what we should expect in a deregulated world,” said Doug Heller, a spokesman for the Santa Monica-based Foundation for Taxpayer and Consumer Rights. “With deregulation, we threw away our ability to ensure reliability – and this is the evidence of it.”

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