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Economic and dam related articles

Dams Hit Dry Spell

by Marc Lifsher, Times Staff Writer
Los Angeles Times, April 17, 2005

A prolonged Northwest drought has cut water levels along the Columbia River, meaning less hydropower is available for export to the south. California's grid operators are worried.

In 1941, folk singer Woody Guthrie wrote a paean to the Columbia River's Grand Coulee Dam, enthusing that power generated by the New Deal monument "is turning our darkness to dawn."

But this summer, the Pacific Northwest's mightiest river could leave California in the dark. A stubborn drought has reduced water levels behind the Columbia's network of power-producing dams by a third, leaving less electricity available for export to the south.

And that prospect is making California's power grid operators nervous.

The Golden State historically has relied on Northwest hydropower to help keep the lights on and air conditioners humming during periods of peak summer demand, and this year will be no exception. California expects to import as much as 6,000 megawatts of Northwest power on the hottest summer days enough to serve about 4.5 million typical homes.

For now, power officials in the Northwest, whose massive hydroelectric dams can produce more than 15,000 megawatts of electricity when running full bore, say they should be able to meet that need, even if they can spare the extra power for only a few hours at a time.

But if California is hit by a severe late-summer heat wave statistically a 1-in-10 possibility the state would have to seek emergency supplies of Northwest hydropower to avoid forcing utilities to cut service to some large customers, according to a forecast released last month by the California Energy Commission.

And if sweltering weather grips Southern California for an extended period, the Columbia Basin's parched watershed might not be up to the task.

"We've got a lot of turbines on the river, and we can probably run them for three hours without depleting much of the water behind the dams," said John Fazio, a systems analyst with the Northwest Power and Conservation Council, which coordinates electricity supplies in Oregon, Washington, Idaho and Montana. "But we can't keep it up for a week."

Even normal weather conditions could severely tax California's electricity grid this summer, according to a recent forecast by the California Independent System Operator, which runs a 25,000-mile transmission grid that covers most of the state although major service areas such as the cities of Los Angeles and Sacramento are outside its jurisdiction.

Power shortfalls could occur despite large-scale imports from the Northwest, Arizona and across the West, Cal-ISO warned, pointedly noting that "in severe drought conditions, neighboring regions' water levels may be too low" to provide the spare electrons California would need at times of peak demand. That happened as recently as 2001, when drought conditions in the Northwest cut hydropower exports to California, contributing to the energy crisis.

"Things will be tight," conceded Jim Detmers, Cal-ISO's acting chief operating officer.

California and the Pacific Northwest have a long history of mutual power dependence, dating to President Franklin D. Roosevelt's creation of the Bonneville Power Administration in 1937.

Roosevelt created the BPA to operate the massive Bonneville and Grand Coulee dams, as well as other hydroelectric dams on the Columbia River and its tributaries. The president envisioned the BPA as a kind of Western version of the Tennessee Valley Authority, the government corporation that dammed rivers and delivered electricity and industry to the rural South during the Depression.

The Northwest project, called a "socialist boondoggle" by critics, struggled for years to win public support. In 1941, the BPA paid folk singer Guthrie $10 a song to write 26 anthems, ballads and blues including "Talkin' Columbia" that praised the mammoth dams and the men and women who built them.

During the next seven decades, the BPA, a self-financing federal government agency, has marketed power from 31 dams and other sources. The agency has been an engine of growth in what had been rural areas of Oregon and Washington, providing below-market-price power to aircraft manufacturers, aluminum smelters, computer makers and farmers.

"The Roosevelt plan was to industrialize the area," said Robert McCullough, an energy consultant in Portland, Ore. "He built the string of dams along the Columbia into the largest integrated hydropower project in the world."

Since its creation in the late 1930s, the Northwest hydro system has been a reliable energy trading partner, sending electricity south on two massive transmission lines to help meet California's summer needs and getting power back to heat homes and businesses during the winter. During recent summers, imports from the Northwest have supplied about 14% of California's electricity needs.

But this year's drought may strain that relationship. Conditions in Oregon and Washington are the driest in almost 30 years. Stream flows are at record lows, increasing the likelihood that farmers will have less water for irrigation and threatening environmental protections for fish and wildlife. Forest managers, meanwhile, are preparing for a difficult fire season.

Despite the Columbia's low levels, the Western hydroelectric power forecast is not uniformly grim.

Snow levels in all parts of California's Sierra Nevada are near records as the persistent high-pressure system that kept Oregon and Washington dry shoved the moisture-bearing jet stream southward. The state Department of Water Resources this month reported snow levels at 37% above normal, providing ample melt to power turbines in California's network of dams.

But some experts worry that even that unexpected bounty may not compensate for the sparse rainfall to the north.

Indeed, California's plan to import 6,000 megawatts from the Northwest and at least an additional 3,000 megawatts from nearby Southwestern states this summer amounts to "wishful thinking," said Gary Ackerman, executive director of the Western Power Trading Forum, a trade group that represents electricity generators and wholesalers.

"When you've got hot weather in Phoenix, Portland and California at the same time, those Northwest megawatts are not going to show up in California," Ackerman said. "They'll be taking care of the air-conditioning load up there."

In addition, Cal-ISO which tries to ensure that electricity gets delivered where and when it is needed in California is not allowed to sign long-term contracts with Northwest generators, leaving that job to the utility companies. In a power emergency, the agency might have to take a back seat to other big users, such as industries and cities in the Northwest, that have already lined up supplies of scarce hydropower.

And even if the power is available, it may not come cheaply. If blackouts loom and California needs to buy emergency electricity, dispatchers at Cal-ISO would have to scramble to buy whatever power is available "out of market." Unlike the spot market, where power prices are capped at $250 a megawatt hour, out-of-market power costs whatever the seller decides to charge.

No one is predicting the kind of price increases that occurred in 2000-01, when power shortages were exacerbated by outright market manipulation by energy traders. But tight market conditions that drive up the cost of Columbia River hydropower also push up the price of natural gas burned in modern turbine power plants making even California's home-grown electrons more expensive.

Waiting until the last minute to buy Northwest power carries other risks. It means the state has little or no margin for error if transmission lines become congested or a forest fire more likely now in the drought-stricken region causes line outages, McCullough said.

It doesn't help that the Bonneville Power Administration is charged by federal law with trying to balance regional energy needs with the protection of dozens of species of endangered fish and wildfowl. Significantly increasing water flows through BPA dams to generate more power could kill huge numbers of salmon and could even be forbidden by federal wildlife officials under certain circumstances.

During the energy crisis, traders for the disgraced Enron Corp., who were manipulating the market to boost profit, joked about how dams in the Northwest were killing fish to generate extra power for California.

Northwest power coordinators could say no if "California calls up in a crisis and asks to wipe out a few million salmon," McCullough said. "Should you schedule flows to maximize survival of salmon or set them aside to cover California?"

If California suffers an energy squeeze this summer, it is more likely to strike in the southern part of the state, where electricity supplies are particularly vulnerable to shortages, energy officials said.

During the last few years, power consumption has grown faster in the south than in Northern California, and more new power plants have been built in the north.

Meanwhile, a growing economy is boosting state electricity consumption 4% a year, putting further pressure on old power plants and congested transmission networks.

Clearly concerned about the potential for trouble, the administration of Gov. Arnold Schwarzenegger has made heading off blackouts this summer and next a top priority. The 2000-01 energy crisis and then-Gov. Gray Davis' role in it contributed substantially to Schwarzenegger's victory in the October 2003 recall election.

While state officials fret, California's investor-owned utilities remain sanguine at least publicly about the power prospects for the coming summer.

Southern California Edison Co., the utility unit of Rosemead-based Edison International that serves much of Southern California outside the cities of Los Angeles and San Diego, told a legislative committee this month that it did not expect to import significant amounts of power from the Northwest and had already lined up a 15% power reserve for this summer.

Sempra Energy's San Diego Gas & Electric Co. testified that it was "fully prepared for summer of 2005."

But such reassurances ring hollow with some analysts, who worry about a worst-case scenario of soaring temperatures in California coupled with tight power supplies from the Northwest and elsewhere.

"There's no question this is going to be a very bleak situation," warned Robert Michaels, an energy analyst and economist at Cal State Fullerton. "If things go really wrong, it's going to have political and economic consequences."

Related Sites:
Bonneville Power Administration


Marc Lifsher, Times Staff Writer
Dams Hit Dry Spell
Los Angeles Times, April 17, 2005

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