Welcome to the Hotel California

I?m always baffled that the energy business remains in denial of California?s quirky political reality show. Developers?after all these years?still can?t get it in their corporate heads that California is not only a state to do business in, but it?s a state of mind. If developers want to be welcomed with anything resembling a cheery glass of fresh orange juice and free tickets to Disneyland, then they should be prepared for a makeover. Not just plastic surgery PR, but honest compromise. You?re not doing business in Kansas anymore. California is the fifth-largest economy in the world. California is also the least likely to welcome economic growth for its own sake. Perhaps we here in the Golden State refuse to grow up, wear pinstripes, and get a real job. Just consider that the state?s highest office has been inhabited by movie star governors, as well as Governor Moonbeam, during my adult life. At the same time, this is a place where computer geeks have celebrity status; where gay marriage is sacred or not?depending on which of the 58 counties you happen to inhabit; where voters achieve cognitive consonance over green power with hydrogen-fueled Hummers. Being a native Californian, I find normal much of what strikes outsiders as quirky. I know we?re different. If I tried to set up shop in the Midwest, I would not use a California template. Out with the tofu; in with the tenderloin. What is odd to me is that those in the energy business are constantly astonished at the peculiarity of California politics. I attribute it to the energy business?s two worlds. One is linear and economically rational, which might even fit in perfectly with the state?s energy requirements. Then there?s the nonlinear Silly Putty of political (and thus economic) realities. If developers want to plant some steel in the ground or on the rooftop to access California?s chimera of economic success?and a darn nice climate?then you need to consider how California thinks, acts, reacts, and/or meditates. There are 35 million people here. Certainly all of us completely agree on everything?just like family. With all the factions to consider, one of the energy industry?s biggest shortcomings is the failure to seriously weigh the commitment of environmentalists and, to some extent, environmental justice (race) groups. Never underestimate environmentalists?it will save you grief in the end. Think Julia (Butterfly) Hill. Remember her? She climbed an enormous redwood she named ?Luna? way out in the middle of nowhere and stayed there for two years, gaining fame and a career in marginal poetry. Think of her and her many cohorts as the next vanguard of platform sitters?only the next time, they will likely be sitting on liquefied natural gas platforms. For instance, Calpine?s proposal to build a liquefied natural gas terminal and associated power plant on Humboldt Bay appeared to be logical?if you were thinking linear sense. The area is somewhat transmission-constrained; it has two aging fossil-fuel plants and one very dead nuke. It could use the power. A few elected officials were welcoming the plans. Then environmentalists hit. Calpine didn?t stand a chance. The company gracefully bowed out of the whole plan before its representatives were tarred and feathered and left at the foot of the statue of President McKinley in Arcata Plaza. Calpine is facing similar opposition?a smaller population base but no less insistent?to its plans for a geothermal plant at Medicine Lake ( Circuit , March 18, 2005). Calpine fought off immense opposition to its San Jose Metcalf power plant. It barely won that one, and I don?t doubt that its success was largely because the timing of the project was so close to the energy crisis. A proposed transmission line under the San Francisco Bay proposed by Babcock & Brown has been delayed at least six months. And that?s before the project has been publicly aired. That is, before environmentalists have got wind of it. Developers swear it will have minimal impact, but the reality of the impact and the perception of putting something into the bay are two different animals. You might notice that Sempra avoided public opposition by trying to develop an LNG terminal across the border. The Sound Energy Solutions proposed terminal on the California coast at Long Beach is facing no end of opposition. Dynegy and NRG?s El Segundo plant repower, which would use large quantities of Santa Monica Bay water, has been mired in controversy for many moons because of the impacts of using seawater for cooling. That fight just landed in the state high court ( Circuit , March 18, 2005). Renewables projects are not exempt from the political dance required before being allowed to plop down a development here. For example, Calpine?s Medicine Lake geothermal = sacred Indian land. Wind turbines = foie gras. Photovoltaic installations = diminished property values. In my native Californian mode, I have a difficult time grasping why companies don?t see it coming. It?s not as if native companies such as Pacific Gas & Electric didn?t have a history of opposition to developments. State politics shot down a string of power plants?many of them nuclear?planned for the coastline 30 years ago. Protests went on for years over Diablo Canyon, and strong opposition to the utility?s plan to plug in new steam generators at the facility remains. It is not only from environmentalists, but from generators who could provide nonnuclear replacement energy. As one Schwarzenegger administration liaison suggests, developers should do some public relations. The populace out there has learned to hate energy companies in the wake of Enron. They already hated utilities. (I?ve heard PG&E booed in a theater just at the mere mention of the utility?s name.) This summer, developers could advise consumers to cut back on the use of their product. Advocating conservation might inch the way to the public?s cold heart, if it is followed up with real action. Install scrubbers. Forget coal. Invest in photovoltaics so there?s more than enough manufacturing to supply demand. Screen wind turbines to reduce bird kill. Rethink LNG terminals to offshore. Involve affected communities. If this gets your accountants upset, send them on vacation to San Diego, the redwoods, Lake Tahoe, or Mono Lake. Maybe then they?ll understand why Californians are so demanding. Perhaps the ones who did grow up and wear pinstripes will no longer be shocked when it takes some dancing and a little extra time to secure an energy development here.

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