WASHINGTON - Wholesale electricity price spikes and outages are possible in the US West this summer if temperatures are as hot as forecasters predict, according to a report released on Wednesday by staff analysts with the Federal Energy Regulatory Commission.
Los Angeles, in particular, has inadequate electricity reserves for the peak air-conditioning month of August, the report said.
The report assessing 2005 summer supply and demand was presented to FERC commissioners at their monthly meeting.
"Under projected hot summer conditions, it appears that reserve margins are inadequate in southern California in August, and very tight in September," the report said.
The most recent summer forecast from the National Oceanic and Atmospheric Administration calls for above normal temperatures in the US West this summer, it said.
Southern California may have no extra power at all to hold in reserve during August, the report said. The reserve margin, the percentage of supply held as a cushion against plant problems or emergencies, was projected at just 5 percent in September, based on the weather forecast.
That compares with an estimated reserve margin of about 15 percent in June for Southern California.
For much of the West, "there may be periods of market tightness, most likely expressed as price spikes and possible interruptions," the report said.
However, it also said, "the most likely situation is no serious disruption" in electricity supplies.
Nationwide, the report said, the US power grid was well supplied for the summer. But wholesale electricity prices are likely to be higher, it said, because of rising prices for natural gas and oil used to fuel generating plants.
California has faced tight power supplies during the past few summers, in part due to drought that limited hydroelectric supplies in the Pacific Northwest.
However, California has not faced a repeat of its 2000-01 energy crisis, which unleashed widespread blackouts and the bankruptcy of the state's biggest utility.
REUTERS NEWS SERVICE
