(KFWB) --

Energy advisers to Governor Gray Davis say California is meeting its energy goals despite concerns from state Controller Kathleen Connell. They plan to send her seven new power contracts today to help boost summer electricity supplies.

Connell had said that the state might have to undertake $3 to $5 billion in short-term debt, in order to pay for power purchases. Otherwise, the state treasury might run out of money by fall, she said, before an influx of cash from the sale of more than $13.4 billion in state-issued bonds.

Connell said less than 1 percent of power purchases are through long-term contracts at set prices. Purchases on the spot market are generally more expensive, because prices can widely vary depending on demand.

During times of peak demand Governor Davis has previously reported spending as much as $1,900 per megawatt hour.

But energy advisers say prices are falling because the state has reduced its energy consumption by 7 percent -- the projected amount. That has brought down prices on the spot market to an average near the $195 per megawatt hour price mark that Davis is counting on for his energy plan to work.

State energy advisers have apparently been accurate at predicting how much the state will spend on energy purchases. In April, the state spent $1.8 billion -- 1.4 percent above the $1.78 billion projected spending.

-- PHO (owennos@bigfoot.com), May 22, 2001

Answers

Shocker of shockers! All along we have been hearing about how Davis is building up long-term contracts as a means of stabilizing electricity prices. Now it comes out that they still have LESS THAN 1% long-term contracts?

This means next to nothing has yet been accomplished, and looking forward to relief from the August bond issue is nothing more than wishful thinking.

-- JackW (jpayne@webtv.net), May 22, 2001.