Counting Negawatts Makes Edison?s Summer Outlook Brighter

For the first time, the California Energy Commission said it would factor into its forecasts conserved megawatts, known as ?negawatts,? from interruptible and other demand-response programs. Changing the equation to include negawatts makes Southern California Edison?s summer supply outlook appear less shaky. Until the June 15 joint agency meeting on the Energy Action Plan, the CEC resisted adding in these numbers because they are not dependable ( Circuit , March 25, 2005). An unresolved issue remains?how many of the negawatts in the programs to count toward supply-and-demand estimates. The California Independent System Operator, for example, has discounted the 1,200 available negawatts in Southern California by 500 MW. The Energy Commission has not nailed down a number, according to David Ashuckian, manager of the CEC?s Electricity Analysis Office. When the latest tweaking of the supply-and-demand forecasts was presented this week, California Public Utilities Commission president Mike Peevey urged his agency, the CEC, and CAISO to adopt a common forecasting methodology so they speak with one voice. ?It will give a greater sense of confidence,? Peevey said. Attending the meeting were more than a dozen state officials?from cabinet secretaries to energy agency commissioners?who proclaimed their support for an updated draft Energy Action Plan. The plan emphasizes the need for energy efficiency to keep blackouts at bay. Aggressive conservation for this summer and 2006 is seen as key to averting possible shortages. The CEC and CAISO continue to project that Edison will cut into its reserve cushion if the mercury soars this summer and/or in 2006. ?Transmission is probably stretched to the limit,? said Robin Smutny-Jones, CAISO director of state affairs. New generation is needed in Southern California, she said. To improve system reliability, Sean Gallagher, CPUC Energy Division director, recommended that all energy suppliers be required to meet the loading order set forth in the commission?s long-term procurement decision and comply with its 15-17 percent reserve requirements. The procurement rules require that power demand be met first with energy-efficiency measures, then demand-response programs and renewables. It is too early to say whether extending the loading-order mandate, now imposed only on investor-owned utilities, to all power suppliers would be accompanied by benefits, such as a guaranteed rate of return on par with that of utilities.

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Counting Negawatts Makes Edison?s Summer Outlook Brighter

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