CA Schedules Load Reductions to Mitigate Blackouts

California regulators instituted a blackout mitigation program among nonresidential customers in which they can schedule reductions of their power use during peak-demand hours in exchange for a fixed per-kilowatt-hour payment. The action by the California Public Utilities Commission is a smaller version of a proposal made earlier in the month by Houston-based Reliant Energy for a "negawatt" program that would include an auction of voluntarily reduced load, rather than a fixed payment amount.

The private-sector utility load reduction program implements a new state law signed by Gov. Gray Davis in April as part of measures responding to the continuing electricity crisis.

In other actions, the CPUC postponed most of its agenda items except for a series of steps tied to the summer rolling blackouts and long-term conservation programs. Added business and industrial customers are given the opportunity to apply for blackout exemptions based on public health and safety impacts, and in a separate action voluntary curtailment programs during peak-demand times were expanded to allow the same customers to participate in both paid and nonpaid programs for scheduled load reduction programs.

As an outgrowth of recent retail electric rate increases and the need to have rate structures that motivate customers to cut their energy use, the regulators decided to initiate a statewide investigation of the so-called "baseline" rate volumes and their ties to various climate zones. These are the estimated minimal amounts of gas and electricity required by residential customers in various geographical areas of the state.

Under the paid-for, pre-schedule load reduction program, nonresidential customers may reduce their electricity use in four-hour blocks and get paid 10 cents/kWh for morning (8 a.m.-noon) and evening (4-8 p.m.) summer peak times. Some business groups, including the agricultural industry, criticized the incentives as "too low."

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