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SDG&E seeks bids to meet energy needs starting in 2005

SAN DIEGO, May 22, 2003 — San Diego Gas & Electric (SDG&E) has issued a request for proposal (RFP) for bids to meet the energy needs in the San Diego region beginning in 2005.

The RFP follows a filing SDG&E made last month with the California Public Utilities Commission outlining the utility’s long-term resource plan for the region.

“SDG&E wants to look at a broad range of options to secure the resources that our region will need as early as 2005,” said James P. Avery, senior vice president of electric transmission for SDG&E. “These additional resources will help ensure that SDG&E is able to meet both the typical daily energy needs of customers as well as their anticipated needs on the hottest day of the year.”

The RFP invites prospective bidders to respond in several ways:

— Arrange for significant reduction in customer demand, at least 1 megawatt (MW), available within 10 minutes of notification.

— Supply capacity and power from renewable or fossil-fuel plants under a 10-year power-purchase agreement. This also envisions a purchase option during the 10 years.

The RFP, which calls for potential suppliers to submit their proposals by July 14, 2003, asks bidders to detail how much power or demand reduction they will be able to provide and when. Suppliers have the option of bidding to supply their resources by the summer of 2005, 2006 or 2007.

All sources must originate from within SDG&E’s service territory or must directly connect to SDG&E’s grid because of transmission-line constraints. The additional resources are needed because a proposal to add an additional transmission line, the Valley-Rainbow Interconnect, has been delayed in the regulatory process. If the line had been approved, SDG&E would have been able to import more power, delaying the need for additional resources in the region.

On April 16, 2003, SDG&E unveiled its long-term resource plan, which envisions a balance of resources to ensure continued reliability for San Diego’s growing economy and population. The plan sees significant roles for more energy efficiency and renewable energy in the region, as well as additional transmission lines and local power plants.

While the plan calls first for maximizing energy-efficiency measures, it still sees a need for power-generation facilities or an equivalent in demand-response programs in San Diego beginning in 2005 to supply an estimated 69 MW of need. The plan projects that the need will grow an additional 120 MW in 2006 and another 102 MW in 2007. One megawatt is enough to power 1,000 homes.

SDG&E is a regulated public utility that provides safe and reliable energy service to three million consumers through 1.3 million electric meters and 789,000 natural gas meters in San Diego and southern Orange counties. Exceptional customer service is a priority of SDG&E as it seeks to enhance the region’s quality of life. SDG&E is part of Sempra Energy Utilities, the umbrella for Sempra Energy’s regulated California utilities. Sempra Energy, based in San Diego, is a Fortune 500 energy services holding company.