Wednesday, October 26, 2005

Sempra citicized for Power deal

Sempra energy's proposal to buy power from a new plant in Otay Mesa is coming under fire.

San Diego Gas & Electric says a watchdog group's criticism of the utility's plan to buy electricity from a proposed new power plant on Otay Mesa fails to properly calculate the benefits of the deal.

In a filing with the California Public Utilities Commission, the utility says the Office of Ratepayer Advocates seriously underestimated the value of buying power from the new plant.

SDG&E says more electricity will be needed as long-term contracts expire over the next decade – a point it says the ORA overlooks – and that the plant will save money by displacing electricity that would otherwise be bought from older, less efficient power plants.

The utility says that failing to buy power from the new plant, which has been permitted and partially built by Calpine Corp., could leave it without alternative sources of supply within the region.