particularly just now in the Pacific Northwest and California. Prices have risen to $600 -$900 per megawatt hour in the Northwest and to $750 (limited by a regulatory ceiling) in California. To translate, $750/mWh is the same as 75 cents per kWh -- the units we buy at residences. The "usual" price is around 3 cents. (Last year the price hit $7,500 and maybe even $9,000 in the mid-west. - That's $75 dollars/kWh versus 3 cents! Remarkable.)
The prices have caused industrial plant to close in the Northwest -- aluminum smelters, paper mills, etc.
Well, "the market works." The high price limits demand.
But when the plants closed in late June, thousands of workers in Washington were laid off. How is it the market forces a cut in their incomes when they aren't in the market for industrial power?
There was a quote in a San Diego paper that was interesting.
And of course he hadn't. The California state senators and assemblymen who did vote for it have expressed surprise -- they thought competition was going to lower prices.Randall Case of Bonita said he was stunned this week to receive an electricity bill $20 higher than before."I turned off the light and went outside to read by sunlight," Case said. He also called SDG&E. "They said, 'It's deregulation, you voted for that,' " Case reported. "I said, 'I don't remember voting for that.' "
There have also been layoffs in Ohio, Montana, and probably elsewhere that I haven't yet heard about. And the summer is just getting started.
Gene Coyle
