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CPUC Denies Two ‘Peaker’ Power Plants In San Diego County

Evening Edition

The California Public Utilities Commission today authorized San Diego Gas & Electric to purchase energy from the re-powered Escondido Energy Center, but denied the utility from procuring power from two proposed plants, slated for areas in Otay Mesa and near the San Diego-Santee city limits.

SDG&E's 25-year contract with Escondido Energy Center involves re-powering the existing 35 megawatt facility, which will increase to 45 megawatts after it is expanded. The CPUC approved the contract because of its relative low cost, small size increase, high viability and environmental benefits.

The CPUC declined to allow the utility to enter into similar agreements with Pio Pico Energy Center and Quail Brush Power, in part because those plants were scheduled to come online in 2014, but evidence demonstrated there won't be a need for more power locally until at least 2018 -- four years into the contracts' 20-year terms.

CPUC officials say the increased rates for buying the extra power at least five years before it is needed would be unreasonable to ratepayers.

“It’s only natural to look at these projects and conclude that they might help address not-yet-defined future problems. However, as tempting as it may be, I think this is the wrong approach,'' CPUC Commissioner Mark J. Ferron said. "We run the risk of paying for new generation twice -- once now and a second time if we have different, conflicting, future information.''

SDG&E is required to either issue new Requests for Offers to meet the remainder of its 298-megawatt need, or to submit a renewed application that better matched the timing issue or demonstrated a different showing of need for either Pio Pico Energy Center or Quail Brush Power, according to the CPUC.

"If SDG&E is able to amend the contracts we declined and bring them back to us, we will consider them,'' CPUC President Michael R. Peevey said. "San Diego is going to need plants with flexible operating qualities in the very near future.''

County Supervisors Dianne Jacob and Dave Roberts opposed the Quail Brush plant. They said it would harm the environment, create visual blight in nearby Mission Trails Park, intrude upon sensitive habitats and set back regional efforts to develop cleaner forms of energy. San Diego City Councilman Scott Sherman also opposed the Quail Brush project.

"As the local representative for Mission Trails Park, this issue hits close to home,'' Sherman said. "I am opposed to the construction of this power plant in the middle of an unspoiled regional park.''

The proposed plants also drew fire from members of environmental groups including the Sierra Club and the Environmental Health Coalition.

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