The last thing needed by California’s electric utilities,already strapped for hydroelectric power, natural gas and cash,is another shortage.
But utility officials say the state is positioned to weather unscathed a developing tightening of supplies of coal, which generates about half of all U.S. electricity.
Some industry experts have rung the alarm bells over a potential coal shortage: the nation’s last-reported coal supply levels earlier this year were 27% lower than the previous year’s, according to the Department of Energy.
And, of course, rolling blackouts are set to occur in California regularly during the hottest summer months when power demand peaks as temperatures rise and both corporate and individual consumers run air conditioning units at high settings.
But California does not rely very heavily on coal,the state has no coal-fired power plants of its own,and the municipal utilities like Anaheim’s that partly rely on out-of-state coal have access to large reserves.
Rosemead-based Southern California Edison, a unit of Edison International, relies on coal for about 10% to 15% of its power generation needs. Edison spokesman Steve Conroy said the company has long-term contracts to buy coal from the Black Mason mine in Arizona, which insulates Edison from a possible drop in nationwide coal supplies.
“We’re not expecting any supply problems associated with coal,” Conroy said. “The Midwest has coal supply issues, but that has no impact on us whatsoever.”
Edison owns 56% of the two-unit, 1,600-megawatt Mojave coal-fired plant in Nevada, which gives the utility around 900 megawatts of supply. At the New Mexico-based Four Corners plant, Edison owns 48% of two of the plant’s five units, which yields about 720 megawatts for California customers.
One megawatt is enough electricity to supply about 1,000 homes.
Anaheim’s Public Utilities Department and the Los Angeles Department of Water and Power both own stakes in the coal-fired Intermountain Power Plant in Utah.
“Right now, the California market is so messed up that discerning the impact of one variable like pricing or availability would be very difficult,” said Marcie Edwards, general manager of Anaheim’s Public Utilities Department.
Still, she said, “I see no problems at the present time in the coal market that would affect Anaheim.”
The Intermountain plant is a significant coal burner, she acknowledged, but the vast majority of coal requirements at the facility are supplied under long-term contracts and coal is delivered at approximately the same rate at which it is burned. Even if problems develop, the plant has a 700,000-ton reserve supply on site, about a 60-day supply.
Coal burning generators engaged in “just in time” supply practices are finding that strategy riskier with coal prices rising to reflect decreasing reserves, according to a spokesman with St. Louis-based Arch Coal Inc., the country’s second-largest coal company.
“Just in time” is when the coal arrives just as a power generator needs it, generators who rely on such coal supplies have little to no backup or inventory coal on site. n
