Message-ID: <28849258.1075863609038.JavaMail.evans@thyme> Date: Tue, 5 Jun 2001 17:17:09 -0700 (PDT) From: mike.swerzbin@enron.com To: brendanb@amerexenergy.com Subject: RE: River's Power Aids California and Enriches the Northwest Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: quoted-printable X-From: Swerzbin, Mike X-To: 'Brendan Boyle ' X-cc: X-bcc: X-Folder: \ExMerge - Swerzbin, Mike\Sent Items X-Origin: SWERZBIN-M X-FileName: my address is: 12404 S.E. Blaine Dr. Clackamas, OR 97015 -----Original Message----- From: =09Brendan Boyle [mailto:brendanb@amerexenergy.com]=20 Sent:=09Tuesday, May 01, 2001 1:35 PM To:=09Mike.Swerzbin@enron.com Subject:=09River's Power Aids California and Enriches the Northwest =20 =09=09=09=09=09[IMAGE]=09 [IMAGE]=09New York Times National << File: spacer.gif >> =09[IMAGE]=09=09= =09=09 [IMAGE]=09[IMAGE]=09[IMAGE]=09=09=09=09 [IMAGE]=09[IMAGE]The New York Times << File: National.gif >> =09[IMAGE]=09[= IMAGE]=09 [IMAGE] SEARCH Today's NewsPast 2 WeeksPast 30 DaysPast 90 Da= ysPast YearSince 1996 =09[IMAGE]=09 =09=09=09=09=09[IMAGE]=09 =09=09=09=09=09[IMAGE]=09 =09=09=09=09=09=09=09 [IMAGE] search [IMAGE] [IMAGE] Today's NewsP= ast 2 WeeksPast 30 DaysPast 90 DaysPast YearSince 1996 [IMAGE] << File:= top.gif >> [IMAGE] Go to Advanced Search << File: NytArticleHeader.gif = >> [IMAGE] [IMAGE] Welcome, betterthanworse << File: gn_home.gif >> Si= gn Up for Newsletters << File: gn_classifieds.gif >> | Log Out << File:= gn_news.gif >> [IMAGE] [IMAGE] =09 =09=09[IMAGE]=09 E-Mail This Article << File: gn_opinion.gif >> Printer-F= riendly Format << File: gn_features.gif >> Most E-Mailed Articles << File= : reale86.gif >> Single-Page View << File: gn_destinations.gif >> [IMAGE]= [IMAGE] May 1, 2001 River's Power Aids California and Enriches the = Northwest By BLAINE HARDEN [IMAGE] Larry Davis for The New = York Times Electricity generated by Rock Island Dam in Chelan County, Was= h., helped the county's public utility earn a record $58.2 million in prof= its last year. Multimedia [IMAGE] [IMAGE] [IMAGE] chartThe Price= of Power Nationwide << File: gn_services.gif >> [IMAGE] [IMAGE] [= IMAGE] Related Articles [IMAGE] [IMAGE] [IMAGE] Plan on California E= nergy Has No Shortage of Critics << File: gn_newspaper.gif >> (April 27, = 2001) Board Orders Limited Price Caps for California Power << File: profi= le.gif >> (April 26, 2001) California Official Spars With U.S. on Power= Policy << File: empty.gif >> (April 10, 2001) [IMAGE] [IMAGE] [IMAGE] = [IMAGE] Other Resources [IMAGE] [IMAGE] [IMAGE] Related Sites * = Interactive Guide: California Power Woes - Associated Press << File: gs_se= arch.gif >> California I.S.O. << File: emailArticle2.gif >> Energy = Department: energy statistics << File: printArticle2.gif >> [IMAGE] [IMAG= E] [IMAGE] [IMAGE] [IMAGE] GEORGE, Wash. - Doing something= nice for California has never been a priority here in the Columbia River = Basin, where high-voltage power lines lope across irrigated fields of alfa= lfa, potatoes and wheat. Politicians from California, as farmers in this = area will explain at great length, have been scheming for decades to sipho= n off the basin's cheap electricity and water. Californians, however, ha= ve been noticeably less irritating as of late. Having fouled up electricit= y deregulation six ways from Sunday, they are skidding into the summer air= -conditioning season desperately short of power. In the last year, much of= their salvation has come from the Columbia River, whose monstrous dams ar= e the largest hydroelectricity machines in North America. All along the r= iver, from Portland, Ore., to British Columbia, utility companies, aluminu= m makers and farmers have joined to help save California - but at a stagge= ring price. Charging whatever California's dysfunctional power market will= bear, people in this narrow stretch of the Northwest have created a kind = of Kuwait along the Columbia. With their record profits, some public util= ities are wiring the emptiness of Eastern Washington with fiber optics, bu= ying diesel generators to make still more power and paying Wall Street-sty= le wages to electricity traders - while making sure that their electricit= y rates remain among the cheapest in North America. Just north of the bord= er in British Columbia, a state-owned utility luxuriated in its California= windfall by mailing out rebate checks to 1.6 million customers. Their go= od fortune, though, has come with a measure of ambivalence and may well be= short-lived. A severe drought is already hurting farmers across the regio= n. If it continues, utilities along the river will have to buy power and m= ay be punished by the same market forces that gave them a windfall. "This= is not nice money," said Alice Parker, a retired farmer who heads a group= that promotes irrigation in the Columbia Basin. "It is something that is = offered to us not to use water so Californians can run their air-condition= ers." Nice or not, a whole lot of money flooded into the Columbia Basin. = North of here in sparsely populated Chelan County, a publicly owned utili= ty that has two dams on the Columbia made three times as much money last y= ear than it ever had before. With just 35,000 local customers, the utility= last year had a $58.2 million profit. It paid its two top power traders $= 285,000 each, an astonishing income in a county where per capita income is= less than $25,000 a year. The utility refuses to reveal the traders' name= s for fear their children might be kidnapped. The chief operating office= r of Chelan County Public Utility District acknowledged that increases in = the cost of power were "huge" and "obscene." But the executive, Charles J.= Hosken, added, "We would be imprudent if we did not maximize this market = for our customer owners." Next door in equally sparse Grant County, a pub= lic utility that also owns two dams on the Columbia has made even more mon= ey maximizing the market. It had a record $88.8 million in profits last y= ear - more than double its best previous year. Grant County Public Utility= District, which has just 40,000 retail customers, is using its windfall t= o help build a $70 million fiber optic network for local residents. It has= also bought 20 diesel generators to guard against power shortages and, if= possible, exploit the power gold-rush. The utility estimates that those = generators could add $50 million to profits in the coming year. Like Chela= n, Grant is using its profits as a kind of drought insurance to insulate i= ts customers from high market prices for electricity, when, as now, local = needs exceed generating capacity in the river. Power rates in Grant and Ch= elan Counties are about one-fifth as much as in New York City. Grant Coun= ty's utility has rejected, for the time being, the idea of giving a share = of its profits to its customers. "How would it look if Grant County gives= away rebates while so many people are paying more for electricity?" asked= Lon Topaz, director of resource management for the utility. "It would be = lousy politics." An Upside-Down Economy The second-worst drought on re= cord in the Columbia River Basin has combined with California's deregulati= on mess to further distort the energy market. Drought has not only helped = increase the price at which electricity can be sold on the spot market - 1= 0 to 20 times as much as last year's price - it has strengthened a compell= ing bottom-line rationale for conservation. Every megawatt not purchased = and used in the Northwest (often at locked-in, long- term prices that are = a fraction of the current market rate) can be sent south to California. Fo= r many utilities, conservation spells local savings and a long-distance bo= nanza. As a result, a regional economy built on half a century of cheap h= ydropower has been stood on its head. Irrigation farmers here are being pa= id up to $440 an acre not to farm. Similarly, aluminum companies are coll= ecting about $1.7 billion this year by not making aluminum. Companies like= Alcoahave earned profits that delight Wall Street, while keeping about 10= ,000 workers on their payroll, by reselling hydropower that they bought in= the mid-1990's under a cheap long-term contract. Even residential custom= ers are being offered a chance to make a few dollars from the power crunch= . AvistaUtilities has announced that it will pay its customers in Washingt= on and Idaho 5 cents for every kilowatt they do not use, if their consumpt= ion falls more than 5 percent below last year's level. For utilities in = the Northwest, by far the largest profits from California's electricity cr= isis have been secured in British Columbia. A number of private American u= tilities have also benefited from California's troubles. BC Hydro, a uti= lity owned by British Columbia with dams on the Columbia and Peace Rivers,= is the first corporation in the history of the province to exceed $1 bill= ion in profits, as measured in Canadian currency ($712 million in United S= tates currency). Continued 1 | 2 << File: toshiba_emlart.gif >> | Next>= > << File: mostEmailed2.gif >> Home << File: singlePage2.gif >> | Back t= o National << File: 01powe.1.jpg >> | Search << File: multimedia.gif >> |= Help << File: chart.gif >> Back to Top << File: relatedArticles.gif >> = E-Mail This Article << File: otherResources.gif >> Printer-Friendly Form= at << File: g.gif >> Most E-Mailed Articles << File: serve?bfmid=3D232712= 48&siteid=3D35542624&bfpage=3Dnytimes_6 >> Single-Page View << File: NYTMe= nuTop.gif >> [IMAGE] =09=09=09=09=09 home << File: USAMenuBottom.gif >> Classifieds Automobiles << File: a= dLinks.gif >> Job Market << File: marketplace.gif >> Real Estate << Fi= le: circulation.logo.gif >> Personals All Classifieds [IMAGE] News= Quick News NYT Front Page Arts Business Health Internation= al National New York Region Obituaries Politics Science Sp= orts Technology Weather Corrections [IMAGE] Opinion Editoria= ls / Op-Ed Readers' Opinions [IMAGE] Features Automobiles Books = Cartoons Crossword/Games Job Market Living Magazine Movies= Photos Real Estate Travel Week in Review Special: Auto Sho= w [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] [IMAGE] Destinations = Boston.com College Times Learning Network New York Today NYT Store= [IMAGE] Services Archives E-Cards & More Help Center Media Ki= t NYT Mobile Our Advertisers [IMAGE] [IMAGE] Newspaper Home De= livery Customer Service [IMAGE] Your Profile Review Profile E-Mai= l Options Log Out [IMAGE] [IMAGE] [IMAGE] [IMAGE] Text Version = [IMAGE] [IMAGE] [IMAGE] =09[IMAGE]=09=09 [IMAGE] Click Here to Re= ceive 50% Off Home Delivery of The New York Times Newspaper. [IMAGE]= SEARCH Today's NewsPast 2 WeeksPast 30 DaysPast 90 DaysPast YearSince= 1996 Copyright 2001 The New York Times Company | Privacy Information= =09[IMAGE]=09[IMAGE]=09[IMAGE]=09 [IMAGE] [IMAGE] [IMAGE] NASA resear= ch creates "smart bed" sleep surface Outdoor air conditioning? Why = break your back and the bank for clean floors? Private DVD theater put= s a floating 6-foot screen right before your eyes Join the e-mail revo= lution without buying a computer Protect any area with an invisible in= frared fence This year's hottest kitchen item...for under $100 Br= ing a drained battery back to life without opening your hood! [IMAGE] = [IMAGE][IMAGE] [IMAGE] [IMAGE] Post a Job on NYTimes.com [IMAGE] = Search NYTimes.com Classifieds AllAutomobilesJob MarketReal EstateOffice = Space Browse the NYT Store Front PageBooksCardsCrosswordsPhotosPost= ersPublicationsReprintsVideos Explore Shopping at NYTimes.com = =09 - spacer.gif=20 - National.gif=20 - top.gif=20 - NytArticleHeader.gif=20 - gn_home.gif=20 - gn_classifieds.gif=20 - gn_news.gif=20 - gn_opinion.gif=20 - gn_features.gif=20 - reale86.gif=20 - gn_destinations.gif=20 - gn_services.gif=20 - gn_newspaper.gif=20 - profile.gif=20 - empty.gif=20 - gs_search.gif=20 - emailArticle2.gif=20 - printArticle2.gif=20 - toshiba_emlart.gif=20 - mostEmailed2.gif=20 - singlePage2.gif=20 - 01powe.1.jpg=20 - multimedia.gif=20 - chart.gif=20 - relatedArticles.gif=20 - otherResources.gif=20 - g.gif=20 - serve?bfmid=3D23271248&siteid=3D35542624&bfpage=3Dnytimes_6=20 - NYTMenuTop.gif=20 - USAMenuBottom.gif=20 - adLinks.gif=20 - marketplace.gif=20 - circulation.logo.gif