Lights On in Anaheim . . . for Now
While their Orange County neighbors have been buffeted for months with power shortages and rate hikes, Anaheim denizens have basked cozily--and cheaply--in the warmth provided by the city’s robust public utility.
But Anaheim’s independence has limits. It is still tethered to the state power grid, so it would be vulnerable to rolling blackouts if they reach Southern California.
That would be no small matter. A big chunk of the county’s manufacturing is based in Anaheim, and the city is the center of the tourist industry. Ten of the city’s largest power users, including Disneyland and Boeing Co., cut back voluntarily on usage last week during Stage 3 periods, while readying plans to cope if the lights go out.
“We do and we don’t live in a bubble here,” said Melanie Nieman, Anaheim Public Utilities spokeswoman. “We’re integrally tied to the state of California, so it’s good news, bad news.”
Understandably, Anaheim residents are confused and frustrated by this. Nieman has had her hands full explaining why the city’s regulated municipal system may end up ensnared by the state’s deregulation mess.
“We’re thinking we’re not going to get it here and then you hear we will,” said Kenneth Artman, a salesman at Meyers Machinery in Anaheim, which markets computerized industrial equipment. “I mean, what the heck?”
Anaheim is the only Orange County city with a public utility. Other municipalities rely on Southern California Edison and San Diego Gas & Electric.
Anaheim generates about 28% of the power supplied to its 123,000 customers at plants it owns entirely or in part. But like Pasadena, Azusa and other municipalities that operate their own utilities, Anaheim buys the rest of its power, and that binds it to the state’s energy fortunes.
The Los Angeles Department of Water and Power, by comparison, generates the majority of the power for Los Angeles and backstops Burbank and Glendale, providing those areas with more complete protection.
Still, Anaheim holds an advantage over areas served by private utilities because it buys its additional power at stable prices established in long-term contracts.
When spot energy prices were low, these flat-rate deals and Anaheim’s investments in the coal-burning Intermountain Project in Utah and the San Onofre nuclear plant looked like costly mistakes. But that equation turned upside down this year as spot prices skyrocketed, blowing the state’s three large private utilities’ finances to pieces.
Although private utilities have passed on some of their misery in fatter bills to customers, Anaheim’s users saw their bills decrease almost 3% this month.
“It’s quite a contrast from that respect,” said Steve Evans, energy manager for Boeing’s 18-building Anaheim compound, which houses 4,000 employees engaged in lab work, manufacturing, engineering and administration. “Our other sites, which are mostly in Edison territory, are taking quite a hit.”
Disney, too, feels as if it has dodged a bullet--at least for now. Although Knott’s Berry Farm in neighboring Buena Park has conserved energy by temporarily closing rides, Disneyland has remained in full swing, reducing power usage only in areas that customers do not see.
Boeing had assumed its Anaheim site also was safe from the rolling blackouts plaguing territory covered by private utilities, but was disconcerted to learn otherwise last summer when the state’s power crisis took hold. Executives are still pinpointing which systems to shut down in what order and how much power each move would save.
“It got scary [Wednesday] morning,” the first day of rolling blackouts, Evans said. “We’re still getting our ducks in a row.”
*
From 3% to 5% of Anaheim customers would be hit by a blackout at any time, Nieman said. Firehouses, police stations and large venues like Disneyland, Edison International Field, the Arrowhead Pond and the Anaheim Convention Center would be spared whenever possible for public-safety reasons, she added.
Ultimately, the private utilities’ problems may overflow into areas served by municipal agencies, including Anaheim, experts warned.
“If there are going to be state-level solutions, they are going to be using taxes from places that have municipal utilities and have nothing to do with this,” said Robert Michaels, a professor of economics at Cal State Fullerton, who consults for independent power producers.
But for now, Anaheim customers still cling to their remaining shard of superiority.
“I talked to a client somewhere else freaking out because his bill went from $600 to $1,200,” Artman said. “Thank God we’re in Anaheim.”
