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COMMENTARY

California energy crisis unlikely in Illinois

"A colossal and dangerous failure" is how California's governor has termed his state's electric deregulation plan. Coupled with classic supply and demand problems, California's deregulation law has created a nightmare of rolling blackouts and rate increases.

We in Illinois can't help but ask, "Can it happen here?" The answer is a cautious "Probably not."

Illinois legislators thoroughly examined all aspects of the issue before approving our deregulation law. They did not act in haste, as the California legislature did. And Illinois electric cooperatives, as well as other utilities, are building new generating capacity. No new large power plants have been built in California in more than a decade and power blackouts have been the result.

Earl Struck
Earl Struck

Illinois lawmakers also had the wisdom to allow co-ops and municipally owned utilities to continue to be self-governed and self-regulated. Locally elected co-op directors are best qualified to make decisions about the future for their members, and are making progressive, informed decisions that will benefit those members.

Two years ago, Illinois came close to an energy crisis as temperatures climbed and electricity usage hit record levels. Because a number of plants were shut down for maintenance, and because there were transmission bottlenecks that prevented the importing of electricity from neighboring states, we were headed for trouble. Fortunately, the weather moderated and the demand for electricity decreased. All of us in the industry breathed a huge sigh of relief.

Since then, Illinois electric co-ops have taken steps to improve the supply situation. Southwestern Electric Cooperative, Greenville, built a new 45-megawatt gas turbine peaking plant, and Corn Belt Energy Corp., an electric cooperative headquartered in Bloomington, has added to its energy mix by installing five mobile peaking units throughout its service territory.

Corn Belt is also spearheading cooperative efforts to build a new coal-fired generating plant near Williamsville. It will be the first coal-fired power plant built in Illinois in many years. Using Illinois coal will provide an economic boost for our state, and the plant will utilize new clean coal technology. Using our vast Illinois coal reserves in an environmentally responsible manner will help keep electric rates as low as possible.

EnerStar Power, an electric cooperative headquartered in Paris, is coordinating the construction of a new 225-megawatt peaking plant. It will be built on reclaimed strip mine land just east of Tuscola, in Douglas County. This is an ideal location, as it will utilize an abandoned site without taking valuable farmland out of production.

Southern Illinois Power Cooperative (SIPC) in Marion, a generation and transmission co-op serving six distribution co-ops, is repowering some of its existing boilers to make them cleaner and more energy-efficient. These improvements will allow SIPC to continue to meet the energy needs of co-op members in southern Illinois and continue to utilize Illinois coal. SIPC will also add gas combustion turbines for peaking power.

SIPC also joined with three other Midwest generation and transmission (G&T) co-ops to form the Alliance for Cooperative Energy Services (ACES). Together these co-ops will be better able to coordinate the power demand of their members and the co-op's generating assets. It's a business plan for the deregulated market that makes perfect sense and follows an old but proven co-op principle — cooperation among cooperatives.

Soyland Power Cooperative recently entered into a strategic alliance with Allegheny Electric Cooperative of Harrisburg, Pennsylvania, and created a new entity known as Continental Cooperative Services. Continental will provide wholesale power to nearly 300,000 co-op members in three states. By joining forces, the new organization will be better equipped to negotiate the risks involved in a deregulated market.

Can the California debacle happen here? Through innovation and investment, Illinois electric cooperatives are working hard to see that it doesn't.

Earl Struck is President and Chief Exceutive Officer of the Assoication of Illinois Electric Cooperatives.

4 ILLINOIS COUNTRY LIVING • MARCH 2001


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