Tech Industry Draining California's Power Supply Wednesday, June 21, 2000 By Michael Liedtke

SAN FRANCISCO  As California's tech-savvy businesses and households plug into an increasingly wired economy, the state's power system is sputtering like a frayed electrical cord.

The decision by California energy regulators earlier this week to temporarily turn off the power in parts of heat-ravaged Northern California hammered home a point that Silicon Valley leaders have been trying to make for some time: The promising New Economy could be short-circuited unless steps are taken to upgrade California's power grid.

"The Internet has had far more of an impact on the (power) grid than we had foreseen," said Justin Bradley, director of environmental programs for the Silicon Valley Manufacturing Group, a trade organization. "It could be a very ugly situation this year and next, particularly if the weather doesn't cooperate."

Northern California's record heat wave  with the normally cool San Francisco tying an all-time record of 103 degrees in mid-June  would have drained the state's power supply, no matter what.

But the advent of personal computers and the Internet is making it more difficult for power suppliers throughout the United States to keep up with the digital age's increased demands.

Computers consume about 13 percent of the nation's power, according to EPRI Corp., a Palo Alto research and development group that studies the utility industry.

The Internet's borderless community also is taxing U.S. power suppliers because about 80 percent of online traffic comes through this country.

To handle all the Internet action, businesses are turning entire offices into warehouses for the powerful computer servers and peripheral equipment needed to navigate networks. These so-called "server farms" consume 10 to 12 times more power than the traditional office building filled with human workers.

Add it all up, and "We are pushing our energy transmission system harder than ever before," said Karl Stahlkopf, EPRI's vice president of power delivery. "Improving our power system is going to be absolutely necessary if we are going to reach the productivity gains (envisioned) in the New Economy."

Computers aren't California's only energy drain. The state's population  already the largest in the country  is increasing at an annual clip of about 600,000 people, many of whom are flocking to the state to cash in on high-tech prosperity.

Pacific Gas and Electric Co., the largest power supplier in Northern California, is scrambling to keep up with the growth. When temperatures soared June 14, PG&E's electricity demand hit a record 23,362 megawatts, a 19 percent increase from the peak level just five years ago.

To meet such strong demand, California imports 19 percent of its electricity from neighboring states, according to the Independent System Operator, which regulates the state's power grid. That option might not be as readily available in the future because of the rapid growth in population in other Western states such as Nevada, Arizona, Oregon and Washington.

Some help is on the way for California. Five power plants, with a combined capacity of about 3,600 megawatts, have been approved by the California Energy Commission. An additional 14 power plants are under consideration.

Winning approval for future power plants usually is a daunting task in California because of environmental concerns and resistance from residents who don't want the facilities in their communities. Calpine Corp., for instance, wants to build a power plant in San Jose  the biggest city in the Silicon Valley  but already has encountered opposition from the city's mayor.

Environmentalists believe the high-tech industry should be exploring other ways to address its energy needs before lobbying for more power plants.

"There are lots of ways for companies and factories to manage their energy usage better," said David Nemtzow, president of the Alliance to Save Energy, a nonprofit group in Washington, D.C. "They can get more efficient equipment and shift more work to off-peak hours. Building more power plants may be necessary, but it should be the last place that you look for answers."

The around-the-clock demand of the New Economy is redefining the traditional concept of off-peak time.

James Macias, a Calpine vice president who has worked in Northern California's energy industry for 22 years, remembers a time when a power outage in the middle of the night wasn't a big deal because relatively few customers were inconvenienced.

"Now if you have a 30-minute outage at 3 a.m., it's a big problem because everything in business is tied to being online and operating 24 hours a day," Macias said. "Hopefully, people will take these blackouts as a wake-up call because they're going to happen again."

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-- Martin Thompson (mthom1927@aol.com), June 21, 2000