Rolling blackouts then become necessary to assure the safe operation of the statewide electric grid. Gas prices increased in California and on the West Coast above and beyond the widespread national increases. Gas storage levels were low, and interstate pipeline capacity was not up to normal levels, further complicating the market and driving prices up. California only produces approximately 13 to 16 percent of the natural gas that it consumes for all purposes. The rest of California's natural gas must be imported.
Electric generation uses about a third of the total natural gas consumed in California.
Natural gas demand for electricity generation in December 2000 was more than double the historical level for that time of year. Predictions Natural gas prices are likely to settle in at present levels. Any major relief is probably two to three years away. May and June now appear to be the months where the electric supply shortage seems to be most critical. An economic downturn could reduce demand, reducing electric and natural gas prices, and mitigating supply issues.