Whipsawed by a booming economy, heat waves in California and spiking prices in a deregulated energy market, local utilities say they are facing increasing pressure this summer. Some of the pressure, which could result in higher rates next year in some areas, could be eased if consumers scaled back their energy use and spared their local utilities from having to buy power from expensive wholesale markets.
Energy conservation can mean big money.
In the 10 years before 1997, utility-backed conservation programs saved enough energy in the Northwest to power the cities of Seattle and Eugene, Ore., combined, according to a December 1999 report by the Northwest Power Planning Council. But conservation spending dropped precipitously in the 1990s. The conservation slide was driven by market forces, according to the planning council. By 1995, the BPA's energy prices were higher than prices on the wholesale market, where utilities sell their excess power. With a glut of energy on the market, it made little economic sense to pay to conserve.