California's Electricity Crisis by Sweeney J.L.

By Sweeney J.L.

For policymakers and others with a significant curiosity in getting past finger-pointing, Sweeney (management technological know-how and engineering, Stanford U.) itemizes the chain of occasions that led California to restructure its electrical energy process, the motives for the failure of that restructuring in 2001, and classes for the long run.

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The amount of electricity used at any instant cannot be perfectly predicted. • The amount of electricity used cannot be controlled by CAISO or the utility. When an appliance, machine, computer, or light goes on, it draws electricity from the system. This is true even if insufficient electricity is available. • Electricity cannot be stored. It is used at the instant it is generated. Therefore, electricity generation must be balanced against electricity use at every instant of time. C A L I F O R N I A’ S R E S T R U C T U R I N G 45 • When loads and electricity generation are spatially separated, electricity must be transmitted from the point of generation to the point of use.

2, since the graph illustrates only the variability across the entire control area. However, additional variability between Northern California and Southern California could require generation to be decreased at one location and increased at another. Third, safe operation of the electricity system requires that operating reserves of generation capacity be made available to compensate for unexpected changes: a generator suddenly fails, a transmission line or transformer is damaged, electricity usage suddenly increases.

Ownership of the three functions, however, would not translate to decision making coordinated among these functions. Decision making and control of its transmission function would be in the hands of the ISO, not the utility owning the transmission lines. The market structure provided incentives for local distribution decisions to be made separately from fossil fuel–fired electricity generation decisions,27 so that a utility that both generated electricity from fossil fuel–fired plants and sold electricity at retail would operate as if two separate companies owned these two functions.

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