Rolling Blackouts Hit Southland for First Time as Production Falls

Southern California got its first taste Monday of power deprivation, as summer-like weather and a drastic drop in electricity supplies forced the first deliberate statewide blackouts since World War II.

A series of rolling outages--which could resume today--began about noon, extending from Sacramento to San Diego and continuing into the night. In all, power was temporarily cut to roughly 1.3 million customers.

The blackouts resulted from a patchwork of circumstances: increased demand, more power plant outages, less output from the state’s financially struggling alternative energy producers, lower electricity imports from neighboring states, and sharply reduced voluntary power cuts by big businesses.

The outages--the first since January--show that the power problems caused by the state’s failed foray into deregulation remain acute nearly a year after the first symptoms appeared in the form of skyrocketing wholesale electricity prices.

But the state’s problems may be just beginning, with the unseasonable temperatures foreshadowing a crunch to come. Monday’s demand was 30,000 megawatts--50% lower than what is expected this summer when it turns hot.

The blackouts were the most extensive yet, affecting customers of Southern California Edison, Pacific Gas & Electric and San Diego Gas & Electric, as well as some municipal utilities. In all, the three investor-owned utilities serve about 9 million customers.

Only residents in the territory served by Los Angeles’ Department of Water and Power and the municipal utilities of Glendale, Burbank and Imperial County were immune, because those areas do not depend on the state power grid to deliver their electricity.

In Sacramento, Republican lawmakers were quick to criticize Gov. Gray Davis, ignoring the role GOP lawmakers played in adopting the state’s flawed deregulation plan.

“It sharpens the perspective that the governor’s inaction and delays are now a major cause of these uncertainties,” said Assemblyman Bill Leonard (R-San Bernardino).

Democrat Davis, for his part, issued only a terse statement: “I assure you we are working night and day in Sacramento to stabilize the electricity supply for California.”

The outages, ordered by the California Independent System Operator--the state’s electricity overseer--surprised everyone from Davis to power company executives to emergency relief workers.

“We didn’t know it was coming. The blackout came on the television news and then, right away, all the lights went out,” said San Francisco Fire Chief Mike Kearney, who works in the city’s Ocean View neighborhood.

Computers crashed. Traffic signals went out. Stores and restaurants were forced to close over the busy lunch hour, or make do under primitive conditions.

Across the state, most Californians responded calmly, though many expressed anger at the scant notice they received before the plug was pulled.

Forecasters predicted that the state’s heat wave would continue today, with temperatures remaining 10 to 15 degrees above normal. The weather should start cooling Wednesday, but temperatures may still be five to 10 degrees above normal.

In Washington, President Bush met Monday with his national energy task force, but warned that there are no “short-term fixes.”

At a separate appearance, Energy Secretary Spencer Abraham cited California’s power troubles as a symptom of the worst energy crunch since the 1970s.

Speaking at a U.S. Chamber of Commerce energy conference, he said: “The failure to meet this challenge will threaten our nation’s economic prosperity, compromise our national security and literally alter the way we live our lives.”

Monday’s blackouts began after the state’s alternative energy producers cut production, taking 3,000 megawatts out of the system, or enough to power 3 million homes. More than a quarter of the state’s energy supply is provided by producers of solar, wind and other alternative sources, which have gone months without payment from the state’s cash-strapped utilities.

The alternative energy producers, which sell directly to the utilities, have been curtailing deliveries over the last several weeks because near-bankrupt Edison and PG&E; have been paying little or nothing for the power they generate. Many of these small generators say they have run out of money to continue operations.

Other suppliers reached credit limits and stopped selling to the state Department of Water Resources, which became the state’s primary electricity buyer in mid-January after some generators refused to do business with the cash-strapped utilities. On Monday, state lawmakers warned that they may cut off further funding until they are presented a clear-cut plan for the state to be reimbursed by ratepayers.

Worsening the power situation, suppliers in the drought-stricken Northwest cut transmissions from their hydroelectric plants by 2,000 megawatts.

Further adding to the woes, the Mohave power plant in Nevada, a major supplier to California, went down for unscheduled maintenance. That resulted in another 1,400-megawatt reduction.

Monday’s outages hopscotched across the state with seeming randomness--knocking power out on one side of the block but sparing another, darkening half a mall while leaving the other side lighted. But there was a method to the madness.

Utilities divide their millions of customers into “blocks” that areblacked out one by one. Also, customers on a circuit that provides power to essential services, such as fire departments and police stations, are exempt from blackouts, representing up to half of all utility customers.

On Monday the disruptions rotated statewide from block to block on roughly an hourly basis.

The strain on California’s grid was apparent early in the day when Cal-ISO declared a Stage 2 emergency at 6 a.m., indicating that reserves were projected to fall below 5%.

A 10 a.m. transformer failure at the Nevada plant pushed the grid into a Stage 3 emergency, meaning the state was within 1.5% of running out of available power. Within two hours, the blackouts began.

Most Californians took the hassle in stride.

When the lights went out at Marshall Fundamental Magnet in Pasadena, Principal Susan Ballantyne had the staff escort students to their classes after the second lunch period ended.

“We said, ‘Use your wristwatch.’ ” Ballantyne said. “ ‘When fifth period is over, release the students. Sixth period will begin as usual.’ It did.”

Because the clocks were off, Ballantyne had the dismissal bell rung by hand.

The blackouts rolled virtually to the ISO’s own doorstep. An outage in south Folsom, near Sacramento, extinguished store lights, snarled midday traffic and stopped cash registers at the city’s large outlet mall, less than a mile away.

Most merchants shut their doors, leaving shoppers simmering outside. Some posted apologetic signs. Others simply locked their doors.

For Melissa Koppel and her mother, Sarah, it was their second blackout of the day. They were shopping at a mall in nearby Citrus Heights, but were chased out by a noon blackout. They headed to Folsom, arriving just in time for the lights to go out there.

For some, the outages were more than an inconvenience.

At Delco Machine & Gear in Long Beach, a maker of precision parts for the aerospace industry, Monday’s brief blackout shut off dozens of sophisticated metal cutting machines. The cost: at least $30,000 worth of damaged goods.

“This isn’t like shutting off a washing machine or a hair dryer,” said Nick Campanelli, vice president of manufacturing. “I just lost a tremendous amount of parts that I can’t recover.”

In Los Angeles, customers were spared any upset, thanks to the independently run Department of Water and Power. Still, general manager S. David Freeman used the occasion to scold state residents. Despite months of dire electricity problems and screaming headlines, Californians still do not seem to grasp the problem, Freeman said. “There is a shortage of electricity in this state,” he said. “That is a fact. The general public doesn’t seem to believe it, but it’s true.”

Customers of Edison and PG&E; were shielded from soaring wholesale prices by a retail rate freeze. But the swelling electricity debt caused a financial crisis at the two utilities, which turned into a statewide supply crisis early in the year.

State lawmakers have been wrestling with various fixes, including the planned sale of $10 billion in bonds to buy electricity, the potential purchase of the utilities’ power transmission systems, expensive conservation programs, and expedited power plant construction. Most of these potential solutions have yet to be enacted.

Throughout the crisis, Davis has been unremittingly optimistic, talking about steps he is taking to encourage conservation and get more power plants built by summer. And he has embarked on a costly program to keep the lights burning, at a rate of about $50 million a day or more than $2.7 billion so far.

But in a sign of lawmakers’ frustration, Assemblyman Fred Keeley (D-Boulder Creek) said many legislators are ready to cut off funds for electricity purchases.

“We can’t continue burning through the general fund without a clear message from the administration about what the endgame is,” Keeley said, echoing a letter sent last week to the Davis administration by Sen. Steve Peace (D-El Cajon), chairman of the Joint Legislative Budget Committee.

The Public Utilities Commission, whose chairperson is appointed by Davis, is supposed to implement a plan in which money from utility ratepayers’ bills would repay $10 billion in bonds. Those bonds, in turn, would reimburse the budget for the money the state is spending to keep the lights on.

A representative of one of California’s power generators, citing the soaring cost of power on Monday’s extraordinarily volatile spot market, estimated that the state spent as much as $83 million for electricity--far more than the recent daily average of $50 million per day.

On Monday, the Department of Finance delivered its sixth letter to the Legislature, seeking another $500 million in general tax money to buy electricity. The request pushes the total sought by the Davis administration to $4.7 billion.

Meantime, Assembly Republican leader Bill Campbell of Villa Park was planning to deliver a letter to Davis today, demanding the resignation of PUC Chairwoman Loretta Lynch. Campbell said the PUC, which is supposed to oversee the private utilities, has been marred by “inaction and delay.’

“We have an entity called California Public Utilities Commission that should have solved it,” Campbell said. “We’re trying to fix things in the Legislature that should have been done by the PUC.”

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Times staff writers contributing to power coverage: Stanley Allison, Eric Bailey, Mark Z. Barabak, Tina Borgatta, Bettina Boxall, Miguel Bustillo, Carol Chambers, Marla Dickerson, Irene Garcia, John M. Glionna, Scott Gold, Abigail Goldman, Carl Ingram, Greg Johnson, Oscar Johnson, Maria L. La Ganga, Thuy-Doan Le, Roberto Manzano, Scott Martelle, Jennifer Mena, Terence Monmaney, Dan Morain, Soraya Sarhaddi Nelson, Anne-Marie O’Connor, David Pierson, Bob Pool, H.G. Reza, Nicholas Riccardi, Louis Sahagun, Richard Simon, Doug Smith, Jason Song, Margaret Talev, Mai Tran, Rebecca Trounson, Martha Willman and Richard Winton. Also contributing were correspondents Deborah Sullivan Brennan, Paul Levikow, Rene Luna and Gene Maddaus.

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Power Points

Background

The state Legislature approved electricity deregulation with a unanimous vote in 1996. The move was expected to lower power bills in California by opening up the energy market to competition. Relatively few companies, however, entered that market to sell electricity, giving each that did considerable influence over the price. Meanwhile, demand has increased in recent years while no major power plants have been built. These factors combined last year to push up the wholesale cost of electricity. But the stateearss biggest utilities-Pacific Gas & Electric and Southern California Edison--are barred from increasing consumer rates. So the utilities have accumulated billions of dollars in debt and, despite help from the state, have struggled to buy enough electricity.

Daily Developments

- Rolling blackouts from San Francisco to San Diego cut power to more than 1.3 million customers.

- U.S. Energy Secretary Spencer Abraham warned that the nation faces its earsearsmost serious energy shortageearsears since the 1970s. He added that Caliia’earss problem earsearswill not fix itsel

- President Bush met with his national energy task force, but said there are no earsearsshort-term fixes.earsears

Verbatim

earsearsThere is a shortage of electricity in this state. That is a fact. T general public doesnearst seem to believe it, but itearss true.earsears

ednesday David Freeman, general manager of the DWP

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Complete package and updates at www.latimes.com/power

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Supply vs. Demand

California’s blackouts Monday were triggered when demand for electricity surpassed the amount of power available. How Monday’s power demand compared to a week ago:

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PEAK DEMAND

Monday: 30,000 Megawatts (7 p.m.)

Last Monday (March 12): 28,675 Megawatts (7 p.m.)

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However, the problem was an unusual number of power plants going offline rather than a surge in demand. The following numbers demonstrate the problem, although they do not include small generating plants, which provide 25% of the state’s power and which also shut down in large numbers Monday.

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POWER OFFLINE

Monday: 12,367.11 Megawatts

Last Monday (March 12): 9,711.46 Megawatts

Source: California ISO

Compiled by NICHOLAS RICCARDI and MALOY MOORE / Los Angeles Times