Issue 3 and Volume 104.

Utilities Running Scared?

I cannot believe that the top executives of nearly all our large U.S. power companies are running scared and avoiding investment in new, efficient gas-fired generation facilities due to the deregulation activity of our federal and state governments.

They seem to only be interested in investments in distant-states’ utility franchise territories or foreign facilities, which will absorb too much of their management staff’s available time and produce questionable results due to the unpredictable wide swings in currency evaluations.

Why can’t these major business organizations, with all their assets and capabilities, compete with other independent power producers in their home area? Are they not capable of obtaining financing for the facilities at as good, or better, interest rates? Are they not capable of planning the new installations of distributed generation facilities in their most strategically needed areas? Do they think it will be satisfactory to just down-size their organizations to become a transmission company?

Are they not aware of the most efficient designs of systems and equipment to achieve their desired operating cost goals? Isn’t it obvious that the most efficient and reliable equipment, as made in the U.S., is just as available to them, and when coupled with a combined steam cycle and thermal storage to chill the inlet air during hot weather, is the least-cost concept? Can’t they buy and site this equipment as well, or better, than an IPP or a major utility subsidiary infringing on their territory?

Isn’t all this indecision only leading to a potential future power generation supply problem for the entire nation? Or is it not a future problem, but perhaps a present problem, judging from our recent summer outage statistics?

It also will be a financial problem for these executives and their utilities, in the near term, unless they change their direction!

Robert E. Cates,
President, R.E.C. Associates Ltd.
Kingwood, Texas

QF Confusion

It appears that you are not familiar with the features of the Crockett Cogeneration Project. The 240 MW project, located adjacent to the C&H Sugar Refinery in Crockett, Calif., has been operational since June 1996. It has been dispatched off-and-on daily on a regular basis for 2+ years. That should make it the first fully dispatched qualifying facility in the United States, contrary to what was claimed for the Kathleen, Ga. facility in your feature article in the December 1999 issue of Power Engineering. Not only is the Crockett project dispatched daily, it is also used by PG&E for load following, a feature that was not claimed by the Kathleen facility.

F. D. Wareham,
Former President, ESOCO Crockett Inc.,
Crockett Cogeneration Facility Operator

Mediation Key to EPA Lawsuits

In regard to your magazine’s January opinion piece and feature article describing the recent EPA lawsuit against seven utilities for alleged Clean Air Act violations, I wish to suggest an alternative solution to assist in resolving this major controversy in our industry.

As an engineer-mediator with 30 years engineering and management experience in the power industry, I know that where bad faith and semantics are involved, the most timely and cost-effective solution is to regroup and review the situation from a mediated perspective. The disputants can still agree to mediation as a collaborative problem-solving process to allow each party to state individual interests and ultimately find common interest as a basis for settlement.

The mediation process lends itself to this approach and often provides consensual resolution each party can live with.

Furthermore, by order of a memorandum issued by President Clinton on May 1, 1998, the EPA as a federal agency is encouraged to pursue consensual methods for resolution of disputes. Of course, it takes two to “party,” and the utilities and the individual states who have joined the fray must also be agreeable to enter into the non-binding mediation process. Needless to say, we are all stakeholders in improving the air quality.

Joe Grynbaum, PE,
Mediation Resolution International
W. Hartford, Conn.