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Calif. Warned on Future Electricity

August 18, 1998

LOS ANGELES (AP) _ The rising demand for electricity in California could lead to planned blackouts and higher rates during hot summer months unless new generating plants are built, according to a report on the state’s new deregulated energy market.

Electricity shortages could begin by 2000 and possibly as early as next year, the analysis of worst-case scenarios concluded.

The analysis, performed by the California Energy Commission, examined what might happen if aging gas-fired and nuclear power plants were shut down and new plants were not built to replace them.

Under the chain of events considered in the report, big commercial users could see higher prices as soon as shortages begin. Price changes would come later for residential and small commercial consumers because their rates are frozen until 2002 under the state’s deregulation plan.

The Energy Commission is considering four applications to build gas-fired generators that together would produce about 2,700 megawatts, about 6 percent of what California uses on a hot day. Plans for seven additional plants, with a combined capacity of about 2,800 megawatts, have been announced by various companies, although the applications have not arrived at the commission yet.

If there isn’t enough power supply, there may be controlled blackouts in different areas.

Demand briefly outstripped supply twice this summer when temperatures soared and millions of users switched on their air conditioners.

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