More details on the false crisis created by Gas AND Electric energy providers, during the time the City capitulated.

From LA TIMES 9/24/02 on FERC ruling:

The case arose from a controversial gas shipping deal between El Paso Natural Gas Co., which owns the pipeline, and El Paso Merchant Energy Group, which sells natural gas. Both are subsidiaries of El Paso Corp., a Houston-based energy conglomerate. The deal ultimately boosted gas prices by $3.2 billion from June 2000 to May 31, 2001, the PUC's Morris said.

The deal between the El Paso pipeline and the same company's marketing unit put as much as 17% of California's daily gas consumption in the hands of one corporate entity. When the contract expired May 31, 2001, the price markup between production fields in Texas and the California border was $6.32 per million British thermal units, according to trade publication Natural Gas Week. A week later, after about 30 competitors had divided up the pipeline capacity, the markup had plunged to less than 25 cents.

NOTE:

All 38 stage 3 emergencies in 2001 occurred before May 31, as did 171 of 173 stage 1-3 alerts, during the time period El Paso were ruled to have manipulated the price of gas. During this time frame ISO levied fines because electric power generators were not delivering promised power.

 

From ISO DMA REPORT:

· Failure to Follow Dispatch Instructions During Emergencies

In Amendment 33, the ISO requested that resources be penalized for non-performance in response to Dispatch Instructions during an actual or threatened system emergency.

The penalty price is equal to the highest energy price paid by the ISO in the hour in which the non-performance occurs. An additional $1,000/MWh penalty applies for non-performance in any hour during which firm load is involuntarily curtailed. A Participating Generator that has notified the ISO in advance that the instructed resource is unavailable or de-rated shall not be subject to such penalties. If such notice is not provided, then the resource is presumed available. If a real-time outage occurs, then the Participating Generator must notify the ISO within the hour.

Result: Assessed $122 million in penalties from December 8, 2000 through July 3, 2001. Compliance has coordinated with the refund proceedings to identify the potential changes to the penalty amounts. Compliance has recalculated penalties based on the mitigated prices determined by DMA and Market Operations. If the refund proceedings were to be concluded at the prices identified, the penalties would be reduced to approximately $42 million.14

 

 

ISO has not released the details of individual fines and so we are left to guess:

1. $42 million/$300 = 140,000MWh / 1,000MW = 280 hours where 1,000MW were withheld. ISO data shows 113,000MWh of non-firm load shedding where the $1,000 fine would not apply.

2. The CPUC claimed that at least 500MW was withheld during some stage 3 emergencies. Using the $1,000 fine listed above $42 million/$1300 = 32,000MWh maximum were withheld during stage 3 rolling blackouts, and according to ISO figures only 19,000MWh were shed during rolling blackouts.

 

http://www.caiso.com/docs/2001/06/01/200106011245292801.xls

http://www.caiso.com/docs/09003a6080/13/f0/09003a608013f05b.pdf

http://www.latimes.com/news/nationworld/nation/la-fi-ferc24sep24.story