Federal Government uses UPLAN model to examine price volatility in ERCOT

LCG, October 11, 2022--The U.S. Energy Information Administration, or EIA, released its latest supplement to the Short-Term Energy Outlook (STEO) in the Texas market, assessing various possible scenarios using LCG’s UPLAN NPM model, with a special focus on the effects on wholesale power prices and market conditions.

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Michigan Governor Supports Reopening Palisades Nuclear Facility

LCG, September 16, 2022--The Governor of Michigan last week sent a letter to the U.S. Department of Energy (DOE) in support of Holtec International’s application for a federal grant under the Civil Nuclear Credit (CNC) program to save the Palisades Nuclear Facility in Southwest Michigan. The federal grant could result in restarting the baseload, carbon-free, nuclear power plant.

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Industry News

California Capsule: Davis May Cut Deal to Save Grid Buy

California Gov. Gray Davis has conceded that he may have to change the terms of his deal with southern California Edison Co. for the state to purchase the utility's electric transmission facilities if he wants the legislature to approve the deal.

Davis and his administration staff handled the negotiations with SoCal Ed behind closed doors, and many of the provisions of the memorandum of understanding between the governor and the utility need approval not only by the legislature but the California Public Utilities Commission.

"There is a determination to try and solve this problem," Davis said, "whether or not it means amending the memorandum of understanding or trying a slightly different approach."

Davis' comment came following a meeting with state Senate Democrats where members of his own party had sharp questions about the grid buy. An earlier meeting with Republican senators deteriorated into outright animosity when the governor directed a stream of obscenities at a lawmaker who questioned proposals to seize power producers' facilities.

Senate President Pro Tem John Burton, a San Francisco Democrat, said "It's clear that the deal, as is, could be problematic. This has to do with what's in the bill, what's in it for the people of the state."

But some lawmakers seemed bent on muddying the waters by tacking on irrelevant provisions. State Sen. Jackie Speier, a Democrat from Daly City, said she wants to amend the bill to provide penalties for independent power producers who overcharge for electricity.

Somehow, lights are still on in California, despite the dimness in Sacramento.

  • California Attorney general Bill Lockyer who, it should be noted, thinks he would make a good Democrat governor, filed a motion in San Francisco Superior Court yesterday asking that two independent power producers be ordered to turn over confidential financial records. Lockyer is conducting an investigation hoping to discover that power producers broke the law by overcharging for electricity.
    Yesterday, the attorney general asked that Reliant energy Inc,. and Mirant Corp. be forced to cough up their records, which he had subpoenaed but which were not forthcoming by a March 19 deadline. He accused the two companies of dragging their feet "so they can keep enjoying these exorbitant profits and prices for as long as possible." Adding a little fire to his rhetoric, Lockyer said "I'm going to pit bull them."
    Reliant said it would be happy to provide the records if Lockyer could provide assurance that the confidential information wouldn't be leaked all over the state.

  • The Sacramento Municipal Utility District voted last night, as expected, to approve electric rate increases of between 19 and 27 percent. The new rates will go into effect immediately after a final vote, scheduled for May 3. SMUD was hit from three sides all at once: Wholesale electricity, which the municipal utility buys to supplement its own generation, has tripled in cost since last October. The price of natural gas, which the utility uses to produce power in its own thermal plants, has also risen sharply. And a dry winter with a small snowpack has reduced production at SMUD's hydroelectric plants on the American River to about 53 percent of normal.

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