The city of Industry has set up its own utility and is eyeing a possible power plant in the west end of town.
The city has bought a vacant warehouse and is studying whether to build a 500-megawatt plant on the 12-acre site. A city-owned and operated plant would give Industry a degree of insulation from California’s power woes and possibly result in surplus power coming into the state grid.
“This is a city that’s virtually all industry,” said Frank Hill, a former state senator and the project manager for the power plant proposal. “And our businesses are very concerned about the reliability of their power and the price they have to pay for that power.”
Among the businesses that came to the city, Hill said, were mechanical steel tubing producer California Steel and Tube, PepsiCo Inc.’s Tropicana Products Inc., toy maker Little Tykes Co. and Hispanic-style cheese maker Cacique USA.
The board of the new city utility, which is known as the Industry Public Utilities Commission, held its first meeting a few weeks ago. According to city manager Phil Iriarte, the utility is set to handle power as well as the city’s water system (Industry is building a 270,000 acre-foot reservoir). The commission even could expand to cover telecommunications.
Other Southland cities have looked into setting up utilities but have not done so, in part because of financial and regulatory hurdles. A city would have to pay Southern California Edison a substantial fee to get out of power supply contracts, for one.
The city that sought to create a utility independent of Edison was Vernon in the late 1980s, according to Larry Kosmont, a Los Angeles-based economic development consultant. That city won the right to form its utility, but only after a protracted court battle with Edison. Vernon remains tied to the state grid and is subject to rolling blackouts.
Industry, though, is not seeking a complete break from Edison and the grid. According to Hill, the city is looking more toward the model of Anaheim or Pasadena, which have their own utilities and their own power plants but still remain part of the overall grid. n
Fine is a staff writer with the Los Angeles Business Journal.
