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Electric Executives' Forum - Summer 2001: Are You Ready?

Demand-side programs are all the rage as utilities scramble to find power to serve peak loads.
Fortnightly Magazine - June 1 2001

So I think we're better positioned than some."

Guarding Against Blackouts

Portland General Electric initiates new programs to increase customer efficiency.

It has been said that rolling blackouts are a possibility in Oregon. Does that apply to your territory?

... We've been working on this for some time. We planned ahead. We did buy ahead. We buy about half of our retail electricity on the [wholesale] market. The rest we generate ourselves. Since we assumed that prices were going to be higher-it was more prices, necessarily, than supply-we planned out as far back as a couple years ago to have some extra energy for our customers. So we think we're well situated. Certainly with the low hydro that we have this year and with all the issues in California, there could be some supply issues in areas around us, but we think we're well positioned.

Were the contracts you entered into long-term?

We don't do [contracts] very far into the future anymore. We used to do long-term contracts of 10-20 years. Now we do two-year contracts-we have [some] on five [year contracts] but not much-most of it's one to two years now.

Is it wise to enter into long-term contracts now, or is that a bad idea because prices are so high?

If I could get a long-term contract at a price that I thought was reasonable, I would enter into it. But right now, as I price long-term contracts, they're above $90 [per megawatt-hour] probably, and I don't think that's reasonable. But if I could get a $55 or a $60 or a $65 for five years, we'd probably do that. ...

What have you done to plan for the unlikely occurrence of shortages?

... The types of things we're doing are talking with customers, getting customers who might commit to come offline or change their usage patterns if we get into difficult situations.

What is your most innovative program that will alleviate summer demand?

Probably the demand buyback [program, under which PGE pays large customers to reduce their load during peak demand periods]. We figured out how it was effective for the individual customer, as well as helping our system, to be able to bring that energy back, and share with other customers. ... This isn't just something that we figure we'll use this summer. We'll continue to use this through time, in the future when we think that there might be shortages. ...

How many megawatts do you hope the program will add to your system?

About 150 MW, I think, is where we are right now. We're out working on some other pieces of flexibility that we can probably even increase from there.

You also have just implemented a program that gives residential customers $12 coupons toward the purchase of high efficiency compact fluorescent light bulbs. How much power will that save collectively?

We hope that it will be 2 MW. That's a modest goal. We're hoping it will be much more, but [that's] just what we thought was immediately doable. ...

What, besides your wholesale contracts and