Power crisis to linger -- experts By Jessica Lowell Wyoming Tribune-Eagle

CASPER – Two energy experts say it may take two years for California to fix its energy problems.

And even when it does, the price of natural gas is likely to settle at a price higher than it was a year ago, they add.

In the meantime, communities like Cheyenne will feel impacts due in large part to the California electricity restructuring debacle.

Since last May, Wyoming consumers have seen increases, sometimes significant, in what they pay for natural gas to heat their businesses and homes.

At the same time, some electricity customers have seen hikes as well. Cheyenne customers of Xcel Energy-Cheyenne Light are facing increases that could range from 57 to 88 percent this year and could go even higher next year.

The reasons are wrapped around the economic model of supply and demand.

Both natural gas and electricity are in relatively short supply. Because demand for both is growing across the West, the prices consumers pay for both are astronomically high.

Roger Cooper, executive vice president for policy and planning for the American Gas Association, said natural gas has become the fuel of choice, especially for industry. Projections show it will play a far greater role in generating electricity over the next decades, he said, and that will affect consumers.

Everett Hoyt, president and chief operating officer of Black Hills Power Corp., said while natural gas will play a significant role, coal still has a place in generating electricity.

Hoyt and Cooper gave their views Tuesday at Outlook 2001, An Economic Forecast Forum, presented by the Wyoming Business Alliance/Wyoming Heritage Foundation.

"Energy is hot; it’s the news across the West," Hoyt said. "But there’s no quick fix."

Cooper said more gas production and transmission is needed, but that won’t happen quickly because of constraints that exist in government regulations, including access to areas like the Rocky Mountain region, where a 10-year supply of natural gas is said to exist.

In the meantime, he said, natural gas imported from Canada will play a role in the Western energy scene.

"They have it, we need it and they need the money," he said.

Without the 13 percent of the national consumption that Canada provides, he said, the price would be even higher.

Hoyt said Wyoming will play a significant role in developing future energy resources because of its reserves of coal and gas.

"We need to facilitate the construction of coal-fired plants and look at environmental regulations," he said.

http://www.wyomingnews.com/story01-main.htm

-- Martin Thompson (mthom1927@aol.com), April 19, 2001