California and the West should enjoy lower priced electricity this summer due to an abundance of hydropower after this winter\u2019s heavy storms. Snowpack in the Pacific Northwest and British Columbia--the source of much of California\u2019s hydropower during spring and summer--is at about 150 percent of normal and snowpack in California itself is at 171 percent of normal, according to Alan Haymes, Federal Energy Regulatory Commission economist. Haymes told federal regulators May 19 that because California can make more hydropower than in previous years, its need for imports should decrease. In addition, the Pacific Northwest and Canada are looking to send more hydropower into California, which likely will create congestion along the West Coast inter-tie transmission lines. The abundant supply of hydropower should drive down the price of power across much of the West, Haymes said. Meanwhile, demand is expected to remain slack due to the slow pace of economic recovery, according to David Andrejcak, FERC acting deputy director of engineering, planning, and operations. The combination of surplus hydropower and limited demand, he explained, is resulting in curtailment of other power generators in the Northwest, including wind power operators (see page 1). Their comments came as part of FERC\u2019s Summer 2001 Energy Market and Reliability Assessment. That review found the price for electricity is expected to decline 5 percent in Southern California south of Path 15 from an average of $49.72\/MWh last year to $47.03\/MWh this summer. The price of power at Mid-Columbia in the Northwest is expected to decline by 34 percent, from $47.08\/MWh to $31.20\/MWh this summer. FERC projects power purchased at Palo Verde in Arizona to decline to $44.55\/MWh from $48.43\/MWh last year. California gets power from each of these hubs. Natural gas prices are expected to be up a bit from last year, according to the assessment, but not enough to have any major economic impact. In other action, FERC opened a notice of inquiry to seek comment on how it might adjust its incentives for construction of new transmission infrastructure across the nation. Since 2006, FERC has assessed incentives on a case-by-case basis but new factors--such as \u201csmart\u201d grid technology, the growth of renewable energy, as well as new policies on transmission planning and grid reliability--indicate a potential need for adjustment. Commissioner Marc Spitzer said some past incentives granted by the commission for transmission projects may have been too generous. That perception raises the prospect that the commission might retroactively adjust incentive packages. In response, commissioner Phil Moeller argued against retroactive adjustments because transmission builders need regulatory certainty. \u201cThis commission should ensure that if it decides to make changes to its incentive policies it does so only prospectively,\u201d he said.