Electricity: The Panic Eases

California’s electric power shortage remains critical but, billions of market-soothing taxpayer dollars later, the aura of panic is easing. Obtaining enough power still is a day-to-day problem and may depend on favorable court orders, but this no longer feels like a runaway situation. An outline of a solution is also emerging in Sacramento.

There are two main paths--one is the power generation proposals announced under an emergency order late last week by Gov. Gray Davis, the other is a grab bag of legislation proposed by a bipartisan group of state senators and by Assembly Democrats. The underlying problem is that California does not generate enough power to meet its own needs. If the new programs produce as promised, this problem will largely be solved over the next three years.

Despite the urgency, the Legislature needs to craft a coherent package including guarantees that new power generation will not significantly harm the environment. Some relaxation of air quality rules is acceptable in a crisis; for the longer term, the environment has to keep its place at the table.

We applaud Davis’ goal of putting 5,000 megawatts of new power on line by this summer, possibly enough to avert blackouts, but question his offer of bonuses to developers who complete new plants by July. This tactic successfully speeded up rebuilding of the Santa Monica Freeway after the 1994 Northridge earthquake, but the state should think twice before spending taxpayer money on a private facility that is likely to generate big private profits.

The Assembly package wisely includes a $150-million loan guarantee program for the development of clean, efficient renewable energy programs, which could otherwise be shoved aside in the rush to build more power plants. A key piece of the puzzle is a bipartisan package in the state Senate to expedite siting of major new plants and “peaking plants” and the repowering of old, inefficient power plants. A pivotal point in the measure authored by Sen. Byron Sher (D-Stanford) allows construction to begin while builders seek needed air pollution credits, possibly from a state pollution offset bank. Currently, a requirement to meet air quality rules before construction begins causes long delays.

The bipartisan Senate cooperation is heartening. But elsewhere the issue is developing a disturbing partisan tone, especially among Assembly Republicans. Instead of pulling together with others trying to remedy the crisis, they have gone on the attack against the Democratic governor in particular and are masquerading as populists by opposing any rate increases.

The state’s spending to keep the power flowing has reached the billions, even as the governor and legislators negotiate a plan to help the major utilities repay huge debts to the power generators. Ultimately, however, customers of the troubled utilities will pay higher rates, especially when, a year from now, rate controls imposed by the disastrous 1996 deregulation law expire.

The next crisis may be a shortage of natural gas and a danger that the gas-producing companies will stop selling to Pacific Gas & Electric Co. for fear of nonpayment. Most of the big new plants proposed would depend on natural gas fuel, and not enough thought has gone into ensuring an increased supply.

Californians are largely taking it on faith that the decisions being made in Sacramento are sound and that it’s worth the huge cost to keep the lights on. As the crisis continues to ease, state officials must make a candid accounting of how much they’ve spent, and on what. Even if the lights stay on, officials can’t afford to keep the people in the dark for long.