The California Consumer Power and Conservation Financing Authority is charged with the responsibility to ensure sufficient surplus of electricity so that we never again face electricity shortages or outrageous prices.

Electricity is a precious and unique commodity. It is essential to our economic health just as water is essential to public health and safety. As California nearly witnessed in 2000 and 2001, an electricity shortage could prove disastrous, driving up prices resulting in potential economic harm to residential consumers and businesses alike. Because of its unique and essential nature, it is necessary to supplement private enterprise efforts to assure adequate electricity supply at reasonable prices.

The Power Authority is charged with the responsibility of ensuring reliable electricity, at reasonable prices. By diversifying its electricity portfolio to include increased renewable energy, permanent conservation efforts, and cleaner burning projects, the Power Authority can prepare California to respond to any eventuality.

Critical to California’s long–term success is the understanding that electricity reserves, like insurance or spare parts, are an economic imperative. As California prepares for earthquakes, droughts, or more motorists on its freeways, so too must it prepare for the likelihood of an electricity shortage. This year peak energy load was considerably lower than projected, conservation was significantly higher than anticipated, and the weather was mild. New power plants were completed on schedule, old plants did not break down as anticipated, and state agencies, businesses, and the public worked well together. Despite these positive factors, blackouts remained a possibility. Most importantly, these positive factors cannot be counted upon in the future.

There are seven main reasons for California to continue with its acquisition of additional resources to ensure sufficient power is available to meet consumers’ needs. They are:

• Reserves must be restored to safe levels;
• California’s long–term purchases were intended to address the reserves issue;
• Old, dirty plants must be retired to make way for newer, cleaner burning plants;
• California must achieve a diverse power portfolio that includes renewable resources;
• Peak load needs must be met at reasonable prices;
• Costs of operating reserves must be drastically reduced; and
• Emergency response and electrical systems must be improved.