SDG&E?s Congestion Management Plan Gets Green Light

By Published On: February 12, 2005

San Diego Gas & Electric?s proposal to factor in congestion costs when scheduling power was approved unanimously by the California Public Utilities Commission February 10. The resolution was the only non-consent energy item voted on during this week?s brief business meeting, largely because commissioner Dian Grueneich awaits clearance from the legal staff before voting on energy matters. The new commissioner, and her former legal office, represented a number of clients in cases that the commission affects?including environmentalists involved in the Diablo Canyon steam generator case now pending and, earlier, clients seeking approval for direct access to contract with nonutility electricity providers. The 3-0 vote approving SDG&E?s advice letter allows the utility to implement a CPUC decision issued last July. That decision required utilities to take steps to alleviate congestion in a manner that conforms with their short-term procurement plans. The decision and resolution approved this week aim to ensure that the supply scheduled is actually deliverable in real time. ?This is a summer reliability resolution,? said CPUC Energy Division director Sean Gallagher. SDG&E specifically agreed to curb its imports from Mexico and Yuma, Arizona, that have been clogging up the southern half of Path 15. The utility also agreed to develop new congestion management procedures with the California Independent System Operator. According to the grid operator, SP15 overloading led to ?dec?ing??backing off power sent into the grid in return for payment. That congestion also increased expensive reliability-must-run power in the San Diego region, resulting in congestion-related RMR costs of several tens of millions of dollars. Those costs are allocated to SDG&E transmission customers, states the CPUC resolution. Southern California Edison objected to SDG&E?s proposal, asserting unsuccessfully that it could raise costs for the utilities? bundled customers while producing no benefits. At the end of last year, the CPUC approved a proposal by Edison to boost its local area reliability, which will allow it to recover the cost of buying at least 600 MW of capacity during the peak summer months. The price was kept confidential. San Diego, along with consumer advocates and the Western Power Trading Forum, protested Edison?s plan. Also at this week?s meeting, commission president Mike Peevey noted that the CPUC was the first commission in the nation ?to take on directly? the issue of global climate change. The state regulators will hold a hearing on the threat of greenhouse gas emissions on February 23 and discuss possible voluntary and mandatory solutions discussed. The commission is looking well beyond energy companies, Peevey said, and will assess how insurance companies, Wall Street, and other industries are addressing the issue.

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