California weighs move to smaller power plants
Date: 13-Feb-03
Country: USA
The California Public Utilities Commission, investor-owned utilities, other energy companies, and consumer groups have been studying "distributed generation" to weigh the benefits of moving a new generation of small, customer-owned power stations closer to where the electricity is consumed.
The Federal Energy Regulatory Commission and other states also are looking at distributed generation.
FERC Chairman Pat Wood has endorsed distributed energy as part of the agency's proposed standard market design rules to connect the nation's patchwork of power grids and make them more efficient.
Last month, FERC asked the energy industry for recommendations on how to create incentives for distributed generation to help meet growing demand for power without investing in conventional power plants.
California has the capacity to generate about 53,000 megawatts of electricity.
Most of the output is delivered to customers by three investor-owned utilities - PG&E Corp.'s (PCG.N) Pacific Gas & Electric unit, Edison International's (EIX.N) Southern California Edison, and Sempra Energy's (SRE.N) San Diego Gas & Electric - and the nation's largest municipal utility, the Los Angeles Department of Water and Power (LADWP).
One megawatt is power for about 1,000 homes.
The CPUC, California Energy Commission and the state's Air Resources Board are encouraging development of new power technologies and smaller, more efficient plants.
LADWP has tested small plants powered by fuel cells, which convert hydrogen and oxygen into water, producing electricity and heat. It has successfully tested fuel cell plants generating up to 2 megawatts of electricity.
The CPUC said potential benefits include reducing peak power demand on the statewide grid, increasing the life of existing power distribution gear, reducing capital risk for the utilities, increasing service reliability and developing new power technologies.
"Most parties agree that distributed generation has the potential to reduce system demand in areas experiencing load growth, and that it should be considered an option to defer distribution investments," the CPUC said in a draft decision to be considered at the commission's meeting Thursday.
