Energy Woes Likely to Worsen

The power shortages now crippling California will be worse than state officials predicted and could spread to the Northeast, Texas and the Pacific Northwest this summer, energy industry experts are saying.

And President Bush's long-range energy plan, expected to be formally unveiled Thursday, is unlikely to offer immediate relief for those shortages or the skyrocketing gas prices that will hit Americans even harder once the summer travel season begins Monday.

Though the Energy Department said Tuesday that gasoline prices may ease around Memorial Day as production is revved up and refinery inventories rise, others cautioned that any relief will be tenuous.

John Cook, director of the Energy Information Administration's petroleum division, said any refinery disruption or pipeline problem could cause prices to soar again. "Today, little cushion exists," he said at a House hearing.

California's problems are only going to get worse. According to a report issued Tuesday by the North American Electric Reliability Council, an industry-sponsored watchdog organization, California can expect  260 hours of rolling blackouts — an average of 20 hours a week — because of a predicted power shortfall that could be as much as 5,000 megawatts during peak demand periods.

A megawatt is enough power to serve 1,000 homes.

While most of the country will have enough electricity, the council's report also warned of potential problems in the Northeast if there is a persistent heat wave, and in the Pacific Northwest and possibly in Texas. The New York City area could have blackouts if there are transmission problems on lines into the region, the report said.

In the Pacific Northwest, there is expected to be enough power to meet summer demand despite low hydroelectric generation as a result of a severe drought. But, the report said, if the region's drought continues, there could be rolling blackouts next winter.

While Texas has plenty of electricity, it "should be closely watched" because the state is shifting into a retail competitive market in June and consolidating some grid management activities, David Cook, the reliability council's general counsel, said.

"There is no magic bullet, no single thing to be done that will solve the challenges we face" in trying to assure electricity reliability, Cook said in testimony before the Senate Energy and Natural Resources Committee.

Bush's proposed energy package will recommend building more transmission lines and power plants to address future electricity needs. The president will also propose changes in air pollution rules to improve the production and distribution of gasoline.

But the White House plan will contain no strategies for increasing supply or lowering prices this summer, according to people familiar with the plan blueprints.

The plan is expected to spark an already brewing debate among consumers who want immediate relief, environmentalists opposed to the building of new power plants, increased drilling and the relaxation of pollution regulations, and supporters who say Americans cannot have cheaper prices and greater supply without making environmental sacrifices.

"If you're going to have lower prices, you need more supply, and environmental regulations have been one of the problems," said Paul Georgia, an environmental policy analyst with the Competitive Enterprise Institute.

Because of  stringent environmental regulations, no new refineries have been built in the United States in the last 30 years, and Georgia said regulations passed under the first Bush and Clinton administrations have prohibited current refineries from making improvements in their operations.

"Trade-offs need to be made," Georgia said. He said Americans who don't want power plants in their neighborhood or oppose the idea of drilling in protected, oil-rich lands like the Arctic National Wildlife Reserve don't understand that "when they turn the light switch on in their house, that electricity is coming from burning coal or some other fossil fuel."

A refinery built today would be much more efficient and environmentally sound than one built 20 years ago, Georgia said, adding that drilling could be conducted in places like the Arctic National Wildlife Reserve without damaging the ecosystem.

"The trade-offs are not as big as people think," he said.

Republicans said they expect the Bush plan — which proposes the opening of public lands for oil and gas drilling and easing regulatory barriers to building plants, transmission lines and the development of nuclear power — to address these issues. But Democrats, who presented their own energy plan Tuesday, have vowed to fight the plan unless the president puts a greater emphasis on conservation and environmental protection.

"We can have adequate supplies of energy and save our environment at the same time," said House Minority Leader Dick Gephardt, D-Mo., adding that "we don't have to just drill our way out of this problem."

The Bush plan does contain provisions for conservation, which the White House outlined during a briefing earlier this week with executives representing renewable energy industries such as solar and wind power and producers of ethanol and organic waste energy plants. The executives were pleased with some proposals for tax breaks for renewables, but, said Jaime Steve of the American Wind Energy Association, "other items need to be included."

Georgia said the country needs only look to California — ground zero for the nation's most progressive conservation efforts — as an example that conservation alone cannot function as an energy shortage solution.

"California has gone further than any other state in conservation and is having the worst problems," Georgia said.