DUKE ENERGY releases California energy records to counter accusations of price gouging

<br>LOS ANGELES (AP) _ Duke Energy has released operating logs to counter accusations by former workers that it reduced output to boost prices during California's energy crisis. <br><br>Ex-employees

Tuesday, July 3rd 2001, 12:00 am

By: News On 6

LOS ANGELES (AP) _ Duke Energy has released operating logs to counter accusations by former workers that it reduced output to boost prices during California's energy crisis.

Ex-employees told state investigators two of four turbines at Duke's southern California plant were shut down for three days in January during Stage 3 power alerts, which can lead to rolling blackouts.

The records show that during most of that time, units One and Two at the South Bay plant in Chula Vista were either supplying all their power to the California market or providing what are called ancillary services.

That's when a plant is paid not to produce, but to stand by in case of emergency, or if the state's grid is already at capacity.

California's Independent System Operator, which manages most of the state's power grid, has acknowledged that it, not Duke, was controlling the turbines at the time.

``Duke was responding to their requests,'' Jeff Stokes, executive vice president of Duke's western gas and power operations, said Monday.

Stokes added that Duke's prices during those three days were somewhere around 25 percent of the $3,880 figure noted by the Federal Energy Regulatory Commission when it singled out Duke for criticism in a June 19 order extending price controls in California.

State officials were not impressed with Duke's operating logs.

Sen. Joe Dunn, chairman of the Senate Committee to Investigate Price Manipulation, said Duke was releasing selected documents that presented ``nowhere near the complete picture.''

Dunn asked the ISO to analyze whether the Duke logs and its own logs indicate any patterns that suggest price manipulation.

Duke, based in Charlotte, N.C., also on Monday slashed $20 million from California's power bill, becoming the first wholesaler to cut its charges for electricity sold to the state during January and February.

FERC has accused Duke of overcharging the state millions of dollars by selling electricity at rates as high as $3,880 per megawatt-hour when it was only entitled to charge $273 per megawatt-hour.

Duke contested the gouging accusations but said it would abide by the commission's order.

``It's our way to say, let's get beyond that,'' Duke spokesman Terry Francisco said. ``Let's try to come up with a long-term solution.''

The ISO had no comment on Duke's $20 million move.

Meanwhile, California's electric grid operator issued an energy alert Monday for the first time since FERC imposed the cost ceilings, triggering price caps in 11 Western states.

Unexpectedly high temperatures brought higher energy use that required the ISO to declare a Stage 2 alert for about three hours, meaning electricity reserves fell below 5 percent. The ISO maintained a Stage 1 alert into the evening, meaning reserves were below 7 percent.

California wasn't the only state wallowing in power woes Monday. Triple-digit temperatures triggered rolling blackouts across southern Nevada for the first time in the state's history.

By the afternoon, Nevada Power's 1.2 million customers had cranked up air conditioners enough to demand a record 3,924 megawatts of power, forcing the utility to cut about 100 megawatts, or enough electricity for roughly 75,000 homes.

``About 10,000 customers were affected for about an hour,'' said Paul Heagen, spokesman for Nevada Power Co. ``Today was a wake-up call.''

Nevada Power asked its major power users, including the neon-lit resorts on the Las Vegas Strip, for voluntary reductions at about 3 p.m.

Casinos switch to backup generators and took conservation measures that went mostly unnoticed by guests.

The utility also imposed rolling blackouts until it could purchase power on the open market, Heagen said.