SPECIAL REPORT * Edison power plant is for sale, and although it may still be needed, Redondo Beach sees . . .A Chance to Get Rid of ‘a Pig in a Parlor’

For half a century, the power plant has squatted on the southern curve of Santa Monica Bay, its block-long facade and ugly, exposed backside overshadowing the Redondo Beach boat harbor and pier and the increasingly upscale shops, hotels, restaurants and condos that gradually have sprouted around it.

Seen from the hills behind the plant, its eight towering smokestacks inject themselves into an otherwise postcard-perfect view of ocean and horizon, dragging the eye from a glimpse of Catalina Island and interrupting the rounded sweep of shoreline that gave the city its name.

Now, with Southern California Edison’s massive generating station on the sales block--due to the state’s imminent deregulation of the electrical power industry--local civic leaders see a unique opportunity to purge the hulk from the coastline and, eventually, to turn its 52 acres--possibly worth $100 million or more--into a seaside mecca.

“This plant is a pig in a parlor,” Mayor Greg Hill said recently, repeating a favorite phrase to sum up the city’s official position on the matter. “It’s just out of place, and its sale provides a great opportunity” to make better use of its precious coastal site.

City officials long to find a developer who could turn the site into a water-oriented village of homes, shops and restaurants, perhaps anchored by a world-class resort hotel with a marine-environment-themed recreation and education component. There could also be canals or a lagoon--”the sky’s the limit,” Hill said.

Problem is, the fate of the Edison plant is not just about land use. It also hinges on whether the facility will be needed to help ensure a reliable source of electrical power as California moves through the sweeping changes anticipated when, on Jan. 1, its energy producers leave a tightly regulated monopoly system and compete for customers in a free market.

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During the summer, a newly created state agency gave Edison’s Redondo generating plant--and several others of the 12 fossil fuel-powered stations the company expects to sell by the end of the year--a “local reliability” (or “must run”) designation. That means the plant must be kept in service to ensure sufficient electrical power for the Los Angeles Basin and beyond.

The designation does not stop the sale, but it threatens the city’s redevelopment dreams because the new owner would be required to keep operating the facility so long as it has “must run” status.

Over the objections of Edison--which is in the final stages of negotiations with undisclosed bidders for the plant--Redondo Beach officials have appealed the “must run” designation to the Federal Energy Regulatory Commission. And the city apparently will get another crack at arguing against the status quo, because the new state agency, the Independent System Operator, is expected to review all such designations next year after it has had some time to evaluate the effects of the state’s massive restructuring of the industry.

What the plant’s ultimate fate will be, and even who will have the final say, is anything but clear.

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“We are all making it up as we go along,” said energy consultant John White of the uncertainties inevitable in undertaking such a dramatic shift. White heads the Sacramento-based Center for Energy Efficiency and Renewable Technologies, an environmentally oriented organization to encourage development and use of cleaner power sources, and he sits on the Independent System Operator’s board of directors.

In Redondo Beach, the escalating tug of war between the city and the giant utility--which expects to announce the new owners for the power plants early next month--is part of a bigger debate over what should become of the post-World War II era behemoths that dot California’s coast.

Built in the 1950s and ‘60s to accommodate the rapidly growing state’s energy needs, the oil- and gas-fired plants use ocean water for cooling and were once considered state of the art.

Most were located in then-sparsely populated or heavily industrial areas and did not share the shoreline with homes and recreation, as the Redondo facility and a handful of other coastal plants do now.

With the technological advances of recent years and the development of cleaner, cheaper, better ways to produce power, most of the coastal plants are obsolete, costly to run and probably could not compete in the free market without the government subsidy that a “must run” designation provides, said energy expert James H. Caldwell.

“It’s very clear right now that while we probably still need some of these old plants to provide a certain amount of local generation, we don’t need them all,” said Caldwell, who is technical director of the energy center that White oversees.

“The problem comes when you try to decide which ones are required and which ones are not. That determination has been turned over to a new agency, but there are a lot of muddied waters” over the details and overlapping jurisdictions, as well as the rapid changes and power plant divestitures engendered by the industry restructuring, Caldwell said.

“What appeared to have happened last summer is that [the Independent System Operator] said, ‘Let’s say [the Redondo plant] is needed until [restructuring fallout] is sorted out.’ And my sense is that it will get sorted out pretty soon,” Caldwell said.

In the view of Caldwell, who grew up in the South Bay and rode his bicycle in the shadow of the Redondo plant, the facility “is the perfect candidate for retirement.” It has had less modernization investment than some of its counterparts and therefore is not as big a factor on the basin’s energy grid, he said.

Edison officials strongly dispute contentions that the plant is wholly outmoded. Its two most recent generating units, built in the 1960s and upgraded, represent “some of the best technology” in use today, according to Bob Jensen, Edison’s public affairs region manager for the South Bay.

Jensen said the city entered the fray at the eleventh hour, despite being informed of some of the issues by him and other Edison officials well over a year ago. Further, the city should have known since December 1996 that the Independent System Operator would be deciding on a must-run status for this and other plants.

“This whole thing has a political bent to it . . . the city has been putting out a lot of misinformation through the media,” Jensen said.

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But city officials said Edison has shared little relevant information about the plant’s status and its impending sale. They said they learned about the “must run” designation only recently, and it was not until fall that they were able to sort through the maze of regulatory agencies to see what standing the city had. The city got a chance to make its case before the federal regulatory board only because Rep. Jane Harman (D-Torrance) interceded on its behalf after it missed a key deadline.

Edison tried unsuccessfully to keep the city out of the federal arena, accusing Redondo Beach officials of distorting the facts, including speculation that the designation would boost the sales price. Federal Energy Regulatory Commission hearings on the plant’s status have not yet been scheduled.

The Redondo Beach generating station and recently added marine research center occupy about 52 acres across Harbor Drive from the city marina.

Its eight generating units were constructed between 1947 and 1967, and the first four are in “long-term shutdown,” according to city documents. Units 5 through 8 operate “intermittently as needed,” on steam turbine technology that is considerably less efficient than the combined cycle gas turbine technology in use today.

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Behind the administration building--which sports a giant mural of whales painted in 1991 by noted marine artist Wyland--and generating units sit a tank farm, switching equipment and storage facilities. Edison is seeking city permission to split off the 22 acres behind the generators and take back that property from the plant buyer.

Edison officials said they are considering trying to develop that land should the plant be shut down and dismantled.

The plant has been a continuing “source of annoyance,” City Atty. Jerold A. Goddard wrote in the city’s motion to be heard by federal regulators.

“Over the life of the plant, residents have regularly appeared before the City Council complaining of air pollution, safety (because of chemicals used in the generation process, among other factors) and noise.”

Still, Edison has been “as good a neighbor as they could be” and has tried to be responsive to citizens’ concerns, said Councilman Kevin Sullivan, whose district includes the power plant.

Sullivan worries about whether the new owner would be as good a corporate citizen as Edison. And he shares other city officials’ concerns that a continuing “must run” designation would encourage the new owners to invest millions in upgrading the facility and keeping it in operation for the foreseeable future.

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Everyone--including the plant site owner--could benefit from its dismantling to make way for development, city officials say. They could sweeten the pot with zoning changes, fast-track permits, even tax or financing breaks.

Meanwhile, Mayor Hill is trying to marshal public opinion to the city’s cause.

“This is the single most important issue the city faces today,” Hill said. “It provides a great opportunity for us as a city--one, we believe, that benefits all and hurts no one.”