WHEN WEST SEATTLE'S Representative Erik Poulsen joined the Technology, Telecommunications, and Energy Committee of the Washington State House of Representatives in 1996, his colleagues thought he was crazy. The Energy Committee was an elephants' graveyard, a place for politicians who'd outlived their usefulness to snooze through interminable hearings of incomprehensible technicality, a place shunned by media seeking the elusive sound bite.
These days Poulsen can barely restrain a grin as he presides as cochair of the Energy Committee. Spurred by the sudden emergence of electricity as a hot issue, fellow representatives of both parties fought for seats this session, only to discover that some things haven't changed: The hearings are still interminable and full of boring, incomprehensible technicalities. But at least the media are there—in force.
The Energy Committee held back-to-back hearings last week, one devoted to forecasts of electricity supplies in the Pacific Northwest, the second on the prospects for supplies and prices of natural gas. By the time the experts finished giving their testimony, the legislators had that caught-in-the-headlights look, and even Poulsen wasn't smiling. And no wonder: Both reports portrayed a future fraught with risk and difficulty; together they offer a presentiment of smash-up.
On Monday afternoon, the Northwest Power Planning Council's Dick Watson reminded his audience that a year ago a council study had predicted that by winter 2003 our region faced a one-in-four chance that electricity supplies would not be able to meet demand, that it would take another 3,000 megawatts of capacity (that's a lot of power) to reduce that risk to 1-in-20, and that power companies were unlikely to see any advantage in investing in new power plants until the crisis was already upon us.
To make matters worse, Watson said, this gloomy scenario assumed that California producers would be able to supply power to the Northwest when supplies here are traditionally short. That assumption has been blown sky-high by the Golden State's own energy crisis.
Even if California manages to get its house in order, electricity prices here aren't going to fall much anytime soon. The dams that provide us with hydroelectric power are suffering because reservoirs are at or near historic minimum capacities and snowpacks are 25 percent below average for this time of year. The Northwest power grid is aging, inefficient, and operating at capacity; even if more power were readily available, we're not well equipped to get it to where it's needed—never mind at what price.
Members of the Energy Committee reacted to Watson's bad news pretty much according to party affiliation. Republicans nodded sagely when Chehalis' Representative Richard DeBolt suggested that if the state would just "streamline the regulatory process," power suppliers would rush to build new power plants, while Democrats, including Poulsen, muttered darkly of supply-withholding, price-gouging, out-of-state producers.
Goodness knows said producers are making out like bandits. Poulsen cites press reports that Duke Energy reports a near 500 percent rise in profits from a single California plant ("There's no question that we've done well," Duke's Tom Williams told The Sacramento Bee). Reliant Energy reports 700 percent profit growth over fourth quarter '99, and Williams 1,000 percent.
But call it gouging or legitimate profit, the current energy market isn't responsible for our dilemma, we are. And "we" includes our elected officials—local, state, and federal.
IT WAS THE FEDS who gave us "deregulation," but it was regional and city governments that all but abandoned any attempt to continue power conservation programs begun in the wake of the oil price shocks of 1973 and 1979. The NWPPC's Watson estimates that if conservation had continued, we'd be 233 megawatts to the better annually and saving about $200 million in energy expenses to boot.
Some on the Energy Committee, among them Representative Jerome Delvin (representing Richland and Benton County), suggested that the current crunch might fade as the gas crunch faded despite OPEC's best efforts. The problem with that scenario came into focus on Wednesday, when Dave Warren, director of the state Energy Policy Office, dropped by with some more bad news.
Warren gave the committee a preview of a forthcoming report by his office on natural gas supply, demand, and pricing. Though his presentation was deliberately dry and understated, the information on view was even scarier. In itself, the current high price of electricity in the region should be just what's needed to get people to invest in efficient new natural gas-fired turbine power plants. Unfortunately, just as electricity prices peaked, Warren said, so did natural gas prices, hitting levels no one could have dreamed of as recently as last fall.
If the cost of generating electricity from natural gas goes up as fast or even faster than the rate you can charge for it, where's the incentive to invest? And there's another, hidden reason investors are reluctant to commit their cash to plants in the Northwest. Right now reservoirs are low and getting lower; but by the time new gas-fired capacity comes on line, they could be brimming over again and hydroelectric power could suddenly undercut the cost of every gas-produced kilowatt hour by a factor of 10—turning investments in gas into a gusher of red ink.
Moreover, Watson explained, a careful survey of all available and suspected North American natural gas reserves suggests that we've only got about enough to last us, at current rates of consumption, about 10 years. The useful life of a power plant is usually figured at 40 years. Who's going to set one up if it's going to have nothing to burn before it's barely out of its box?
Then what's to be done? Despite their intermittent bows to partisan idols, both sides of the aisle seem to acknowledge that there's really only two ways to go to avoid, or at least mitigate, the coming crisis: conservation and alternative sources of energy. If anyone finds it ironic that staunch market-oriented Republicans are discovering the virtues of solar panels, fuel cells, and wind power, let them restrain their horselaughs. For the first time ever, both parties, both houses, both executive and legislative branches in this state are converging on a coordinated energy policy for Washington. Poulsen's Republican cochair, Spokane area Representative Larry Crouse, says that Governor Locke may announce the first results of that process as early as this Thursday.
Don't expect too much. Even with a gun to their heads, politicians' attention span is butterfly-brief. But for now at least, attention is being paid.
For more on the bipartisan plan for short-term energy solutions, visit www.governor.wa.gov