Companies Seen Boosting Power Generation Output

San Diego utility customers, who want to reduce their use of expensive electricity or sell energy back to San Diego Gas & Electric, now have the capacity to generate about 140 megawatts of power, according to Eric Pulliam, SDG&E;’s supervisor of alternative energy.

That figure likely will increase--conceivably to 640 megawatts in the near future, Pulliam added.

Some of that power is used by customers who want to reduce their use of SDG&E;’s more expensive electricity. However, others--primarily non-utility businesses--generate electricity with the specific intent of selling it back to the utility.

Pulliam said the utility is “not overjoyed” at the prospect of customers generating power that the utility might otherwise sell for a profit. “It’s a lost-sales opportunity for us,” said Pulliam, who added that the utility’s fixed costs are subsequently spread across a smaller base.

Although utilities such as SDG&E; need power generated by their customers, California utilities are petitioning legislators to give utilities better control over when customers generate power to be sold back to the utility.

“Obviously, we’d like it during our peak usage hours, not off-peak,” Pulliam said.

While that issue is still being argued, SDG&E; is making room in its growth plan for customer-generated power. The utility expects customers to add more than half of the 1,000 megawatts of additional generating power that will be needed by 1995.

However, as long as SDG&E;’s electric rates remain high, the county will remain a hot spot for cogeneration, said University Energy President John Zanot, whose company sold $20 million in cogeneration equipment during the most recent fiscal year. Cogeneration, he added, “isn’t feasible where there’s lots of cheap coal or hydropower electricity available.”