Thanks for Your Concern, Wall Street
A few odds and ends, mostly odds, from the energy front:
The first comes via Bloomberg News, the financial information service. In a dispatch filed Thursday--a day that saw California slide to within minutes of yet another round of rolling blackouts--Bloomberg offered, without a whit of irony, an upbeat near-term analysis of the U.S. energy industry.
Profits among energy traders and generators, a Wall Street analyst told Bloomberg, could rise by as much as 30% this year. The reason, the dispatch explained, was that “electricity and natural-gas traders are profiting from deregulation. . . .” What’s more, “many benefited last quarter as increased demand sent prices surging in California and other parts of the U.S.”
This belaboring of the obvious was followed by a quote from the Merrill Lynch & Co. analyst. Looking ahead to the summer, Steven Fleishman could hardly contain his enthusiasm: “Hot weather,” he chirped, “could be the cream on the top.”
So there it is, Californians.
Our crisis is their cream.
Wall Street loves us.
The energy companies love us.
We are making so many wonderful people so wonderfully rich.
Last Friday was the deadline for Californians seeking exemptions from blackouts to file their case with the state Public Utilities Commission. Among the applicants is John Lee Hooker’s Boom Boom Room, a blues club in San Francisco’s Fillmore district. Because exemptions will be granted only to those who provide “essential” services--who can demonstrate, for example, that a power cutoff might cost lives--the Boom Boom Room’s case is hardly a dunk by Shaq.
Still, Boom Boom owner Alex Andreas gamely gave it a shot.
“If the lights went out during a show,” he told a San Francisco Chronicle reporter, “there would be a huge panic, and people would freak out.”
As it happens, a similar stampede of exemption-seekers occurred during California’s power crisis of 1948. (Yes, we are living a rerun, even down to the absurdities.) In a study conducted for the Institute of Government Studies at UC Berkeley, researcher Stuart A. Ross found that the 1948 roll call of those seeking to avoid service interruptions included:
The California Bakers’ Assn., which noted that “bread was essential to community health” . . .
Union Ice Co., which argued that its ice was “used almost entirely for the preservation of food and hence was essential to the public health and safety” . . .
The California Brewers Institute, which fretted about what might happen to “its vast quantities of beer in fermentation” . . .
And the Market Street Assn. of retailers, which sent a representative to argue that lighted store-window displays deserved the same consideration as agricultural irrigation pumps: “Both bring sustenance and both depend on electricity.”
About a week ago, the idea of switching to regular, planned power outages--as opposed to unpredictable rolling blackouts--appeared to be gaining momentum. Alas, the governor and the energy bureaucrats instead have settled, at least for now, on a system in which warnings will be issued an hour or so in advance of any potential blackouts. In its debut Thursday, this approach seemed only to add to the general confusion, as the alarm turned out to be false.
“It’s a crapshoot,” a state Chamber of Commerce official said afterward. “We’re not going to get the level of precision that would be optimal, that would allow you to make a decision that would be foolproof.”
Let me make once again, briefly but with feeling, the case for scheduled outages. These outages would last, say, three or four hours and would unfold, on schedule, one or two workdays a week, whether they were needed or not--same days, same times for each customer. Just like garbage pickup day.
In a single stroke, such a system--if properly calibrated and coordinated--could undermine any peak-hour manipulations by generators, saving truckloads of money, and spare Californians the inconvenience and even fear that comes from not knowing if the power will stay on through any given day.
Factories, shops, agricultural concerns and the like could make plans. Backup generators could be rented rather than purchased. Shifts could be split. Retail store jewelry could be locked away safely in anticipation of the outage hours. Traffic officers could be dispatched in advance, not on the fly, to affected intersections. Invalids needing electricity for medical devices could be moved elsewhere. And so on.
It requires no great feat of intellect to build a list of ways in which scheduled blackouts would be superior to rolling ones, even with one-hour warnings. A more difficult riddle is this: Why don’t they want to do it? Every expert seems to agree that blackouts in some form are inevitable, so why not plan them out, beat the generators to the punch, seize control of the situation? What’s to be gained by keeping Californians on edge through a long, hot summer? Just curious.
