Bush Offers No Answers for California

President Bush suggested Tuesday that the rolling blackouts flickering across California could endanger the nation’s prosperity, but offered no hint of what his administration might do to prevent that from happening.

As record heat helped push the state into a second consecutive day of outages, affecting about 300,000 customers of California utilities, the president touted his long-term energy policy and warned anew that Americans “cannot conserve our way to energy independence.”

Speaking at a dinner banquet of the Electronic Industries Alliance, Bush also provided an advance peek at his emerging energy agenda, which is to be unveiled next week.

He said the plan will emphasize energy exploration and the expansion of infrastructures to deliver power across the nation.

“I’m concerned about rolling blackouts in California,” Bush said. “I’m concerned what that could mean to entrepreneur growth and to high-tech industry.”

Unseasonably warm weather fueled a surge in demand and forced two one-hour outages throughout the state Tuesday. The blackouts began at 3:15 p.m., primarily hitting customers of the state’s three big private utilities, Southern California Edison, Pacific Gas & Electric and San Diego Gas & Electric. There is a good chance of more blackouts today before expected cooler weather reduces the risk, said operators of the statewide electrical grid.

Bush told several thousand diners that new technologies are emerging “that will encourage conservation” and “make it easier for all of us--consumer and business alike--to conserve precious energy.”

The president did not elaborate, but added: “We can’t conserve our way to energy independence.”

Vice President Dick Cheney, who is heading the task force drafting the national energy strategy, made a similar point Tuesday in an interview with CNN.

“What’s happened in California,” Cheney said, “is they’ve taken the route of saying, ‘Well, we can conserve our way out of the problem . . . we don’t have to produce any more power.

“So they haven’t built any electric power plants in the last 10 years in California, and today they’ve got rolling blackouts. . . .”

While Gov. Gray Davis has called on Californians to conserve energy this summer as a means of narrowing the gap between the state’s demand for electricity and its limited supplies, his administration also had approved plans for 13 major power plants in the state, most of which will not be online until next year or the year after.

The operators of California’s electrical grid said Tuesday that it appeared Californians were failing to heed Davis’ calls to cut back.

“Right now, it looks like we are seeing a lack of conservation,” said Jim McIntosh, grid operations manager for the California Independent System Operator, which is charged with keeping electricity flowing through the state’s network of transmission wires. McIntosh stressed that conservation is hard to measure. But he said electrical use Tuesday was following historical patterns, and not showing a dip that could be attributed to conservation.

The strain of air-conditioner use during the hot spell has been exacerbated this week by a large number of power plants being shut down for routine maintenance, which their managers want to complete before summer weather begins in earnest. A number of small, alternative power generators also remain shut down because of financial disputes with utilities.

In addition to touting conservation, Davis has called on the Bush administration to impose short-term price caps on wholesale electricity to help the state through its crisis. Bush has been adamantly opposed to such caps, as has Cheney.

California partially deregulated its electricity market in 1998, allowing wholesale prices to rise and fall unfettered, while temporarily holding down the retail rates that consumers pay. The plan was supposed to foster cheaper energy, but prices have soared in the past year, driving the state’s largest utility, Pacific Gas & Electric, into federal Bankruptcy Court and forcing the state to purchase power on behalf of PG&E; and Southern California Edison.

Prices jumped again Tuesday, in some cases topping $500 per megawatt-hour, traders said. Prices have been in the $350 to $400 per megawatt-hour range before Monday, then jumped by $75 to $100 as hot weather settled over the state.

In his remarks Tuesday, Cheney also signaled that the Bush administration’s energy plan will not address a simmering controversy over the application of new pollution standards to aging power plants that undergo renovation.

And he said the energy task force he is heading will not seek to impose more restrictive fuel efficiency standards on sport-utility vehicles and light trucks.

Taken together, the vice president’s comments suggest that the administration has decided to defer action on some hot-button issues that had the potential to intensify opposition to the energy plan, which is scheduled for release May 17.

But environmentalists said the omission of those issues will not dampen their criticism of the plan, which is already drawing fire based on acknowledgments by Cheney and others that it will place more emphasis on energy production than conservation.

In his comments, Bush said his administration, which has been harshly attacked by environmentalists on an array of issues, intends to “foster good, common-sense conservation policy” that also is “sensitive to the environmental concerns of many Americans.”

And laying the groundwork for the introduction of his energy agenda, Bush said:

“We need a policy that encourages exploration and expansion of the infrastructure necessary not only to find natural gas that’s fueling many of the new plants being brought on line but the pipelines necessary to carry that natural gas to places where they’ll be used.”

Bush also said that America needs “more electricity wires” to conduct power across the country.

“It is time for an administration to . . . develop an energy policy that’s good for the long-term economic growth of this country. And that’s exactly what this administration is going to do,” Bush said.

Also Tuesday, Associated Press reported that the Cheney task force will propose legislation to give federal authorities the power of eminent domain to acquire private land for new electrical transmission lines.

The AP report quoted three unidentified administration officials as saying the task force will ask Congress to expand the eminent domain authority already exercised by federal officials over the siting of natural gas pipelines.

While industry groups have sought to give the federal government greater authority over siting of power lines, state officials have opposed it as an intrusion into home rule. In an interview with The Times on Friday, Cheney confirmed that the task force report would address the eminent domain issue but would not say what it would recommend. Efforts to confirm the AP report Tuesday were unsuccessful.

In the interview with CNN, Cheney was asked whether the plan would take a position on the Environmental Protection Agency’s strict enforcement of the “new source review” requirements of the Clean Air Act. Environmentalists have expressed concern that the energy blueprint might weaken enforcement of the requirements, which the Clinton administration applied aggressively to reduce pollution from older power plants.

The new source review provisions require utilities to install modern pollution controls when they renovate older power plants, if the changes constitute “major modifications” of their facilities.

At issue in the dispute are seven lawsuits and one administrative action by the Clinton administration requiring utilities to install the best available pollution control technologies at a number of renovated plants.

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Times staff writers Mitchell Landsberg, Robin Fields, George Ramos and Nancy Vogel in Los Angeles, John Glionna in San Francisco and Elizabeth Shogren in Washington contributed to this story.