Despite numerous press conferences and a lot of hype from political leaders, the bulk of the nearly 10,000 MW in California’s long-term electricity deals still have not been nailed down in formal signed contracts. The agreements are suppose to provide up to 7,000 MW this year and up to 10,000 MW over next 10 years.

Numbers released by Gov. Gray Davis’s office late Tuesday said that 19 contracts with seven suppliers have been signed, but another 25 “agreements in principle” with “various suppliers” are still unsigned. The total contracts and nonbinding agreements add up to more than 8,800 MW over the next 10 years, the governor’s office said.

Davis long has argued that long-term contracts “should stabilize the market and drive down the price of electricity,” and his office’s latest statistics indicate that the state water resources department is making 95% of its purchases in the day- and hour-ahead markets, as opposed to the more volatile, expensive real-time market where the state transmission grid operator, Cal-ISO, has had to make large purchases in the past to keep the lights on.

The Davis administration said on Tuesday that DWR had reduced the average cost of these spot supplies from $330/MWh to a portfolio averaging $228/MWh at the end of February. The average price of the 10-year deals is $69/MWh, according to Davis’s staff.

Without providing any specifics, Davis’ people maintain that DWR’s long-term agreements are helping expedite the construction of 10,000 MW of new power plants over the next 24 months, although many of those plants were planned and approved prior to the state stepping in to buy electricity in mid-January.

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