DistribuTECH Returns to California-The Land of “Absurd and Chaotic” Energy Markets

As was expected, the 11th annual DistribuTECH conference and exhibition held in San Diego in early February couldn’t have occurred at a better time or place. DistribuTECH began its second decade amid the “absurdity and chaos” of the California energy crisis. The opening session drew the attention of eight local television stations and the local newspapers.

Some hard-hitting industry experts addressed a standing room only crowd during the Keynote session, which opened the three-day event. The speakers included LeRoy Nosbaum, president and CEO of Itron, James Rogers, vice chairman, president and CEO of Cinergy, Joseph Welch, president of International Transmission Co., a new company formed by DTE Energy Co., and David Hawkins, an operations manager for the California ISO.

In his presentation, Rogers said California’s initial deregulation concept was off-base and that the state’s current experience will be helpful in directing future policy decisions. He said when it comes to deregulation, California residents are experiencing “the perfect storm.” To create a perfect storm, three forces must all converge at once. According to Rogers, those three forces are severe imbalance of supply and demand, a flawed deregulation plan and high natural gas prices. Some say deregulation has slowed, but Rogers disagreed. “I believe we are in the middle of deregulation,” he said.

Much of Rogers’ presentation focused on the need for a real energy policy and the role technology will play in the future of the energy industry. “Now is the time for technology and technology related products in our industry,” Rogers said. He encouraged those in the audience to take a close look at the technology being showcased on the exhibit floor. This is the type of technology that will help usher in a successful energy market, he added.

David Hawkins of the California ISO provided an overview of the state’s energy market and possible steps to take to improve the current situation. Hawkins began by saying that it was perhaps a little naàƒ¯ve for those involved in setting up the current deregulation plan to believe “the market would provide.” Generation is a capital-intensive market and generators want some sort of market structure that assures they won’t run only during peak times, he said. Hawkins also added that siting issues are too difficult. Hawkins reiterated what Rogers said, citing other problems such as high natural gas prices, a short electricity supply in the Western states, partially due to lack of rain/snow fall, and the major utilities not being allowed to pass the high rates along to their customers. Hawkins focused on the importance of long-term contracts, but added that California still hasn’t found the magic formula for encouraging such deals. Hawkins stressed that demand-side management is necessary.

Also speaking during the Keynote, Joseph Welch discussed changes in the transmission industry. His newly formed International Transmission Co. will be the first truly independent transmission company, he said. With this step, he hopes to move the transmission market into the new economy. “Our job is to facilitate the creation of markets,” Welch said. Comparing his task to the process of building highways through rural America, he said his company now must turn an old-fashioned entity into a regional, easily accessible solution that facilitates the energy market. “Market-based solutions will create the right climate in the transmission market,” Welch said.

Once the Keynote concluded, the exhibit hall became a flurry of activity. With more than 4,500 people registered for the event, it is no wonder there was a lot of traffic on the floor. Steady floor traffic meant that all 275 exhibitors had an ample audience for their demonstrations.

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DistribuTECH will be back in Miami for the 2002 event. With the many electricity market changes, next year’s conference and exhibition should be just as eventful as this year’s.

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The Clarion Energy Content Team is made up of editors from various publications, including POWERGRID International, Power Engineering, Renewable Energy World, Hydro Review, Smart Energy International, and Power Engineering International. Contact the content lead for this publication at Jennifer.Runyon@ClarionEvents.com.

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