DWP, FREEMAN URGING CONSERVATION LOS ANGELES NEEDS TO FIND NEW WAYS TO KEEP LIGHTS ON FOR OTHERS.

Byline: RICHARD NEMEC Local View

AS California wades through rolling electricity blackouts and private-sector utilities once viewed as financially invulnerable as Fort Knox tumble toward bankruptcy court, Los Angeles residents and their government-run utility need to pay close attention. It has been estimated between $140 million and $170 million is past due to the city utility from the state's electricity grid operator and private utilities.

Even in these times of multibillion-dollar debts that have helped precipitate the state's energy crisis, $140 million is still ``real money.'' As a result, everyone from the mayor to the City Council is trying to tell the city Department of Water and Power how to manage the situation.

To his credit, DWP general manager David Freeman is trying to advocate patience and cooler heads than are customarily found when the politicians take over. A person needs to only review the state's power mess to understand what happens then.

Since DWP is inextricably tied to the same western states electricity-transmission grid as California's private-sector utilities that are spilling billions of dollars of red ink, the city has a very real stake in seeing the electricity mess cleaned up.

If the situation is not resolved - and soon - electricity reliability, risk and cost for Los Angeles residents could escalate, as they already have for customers of Southern California Edison and Pacific Gas and Electric Co. Thus, local politicians as well as DWP's leadership need to be engaged in the state legislative, regulatory and economic deliberations.

During last week's rolling blackouts that were luckily confined to the northern half of the state, California's independent, nonprofit transmission grid operator drew on emergency supplies of several hundred megawatts each day from DWP. Eleventh-hour supplies and greatly stepped-up energy conservation helped keep a very bad situation from getting worse.

Since the New Year, as the crisis mentality and political posturing has grown considerably around the state, Los Angeles has jumped into a higher, more serious profile than its pre-holiday jousting about the city being a good place to celebrate since we were sure all our holiday lighting would remain turned on.

Mayor Richard Riordan raised the city profile in a Jan. 10 letter to Gov. Gray Davis, saying DWP would be glad to continue selling emergency supplies to the state, but he wanted assurance that city residents wouldn't be left holding a big, unpaid bill.

While offering to work closely with the state in developing new generation if the state would, in effect, guarantee a long-term market for the extra megawatts, the mayor on the other hand asked for the governor's assurances the current emergency supplies that are going unpaid eventually will be covered.

Not to be outdone, the City Council passed a resolution that assures Californians that L.A. will continue to provide extra supplies of electricity, and the DWP's governing board held a special emergency meeting to determine if fiscal prudency will allow the city utility to keep selling without some resolution of the mounting unpaid bills.

Freeman has been shuttling between the politicians and the bean counters trying to keep everyone happy while he helps Davis in his star-crossed attempts to ``keep the lights on.''

Even though the complicated demise of California's electricity deregulation effort has been oversimplified by state officials with off-hand indictments of private-sector energy companies, Freeman knows that DWP's long-term fate is tied to some of these firms. A case in point is the coal-fired Mohave generating plant in Nevada in which Southern California Edison Co. owns the majority interest that state regulators Thursday blocked it from selling.

DWP was slated to sell its much smaller share of the same plant, which Edison operates, contingent upon the state approving Edison's sale because the buyer is looking for the whole enchilada. DWP still may sell its interest, which it doesn't need for L.A.'s future power growth.

Needless to say, in the midst of the state's biggest power shortage ever, it is not politically acceptable to sell off any generation owned by California-based utilities, and a new state law bans private-sector utilities from doing that until at least the year 2006.

Like it or not, the city and DWP have to share in this statewide energy crisis.

Even before the governor's declared state energy emergency or last summer's electricity price spike, Freeman had pushed DWP hard to develop its ``Green Power for a Green L.A.'' program to promote more use of wind, solar and biomass power; he had pushed more environmentally sensitive approaches to energy use; and he had encouraged large customers to join in efforts to ``store'' electricity.

When he is not overpoliticizing the issue, Davis makes an articulate, legitimate case for Californians to step up their conservation efforts. Even with our almost embarrassing excess power capacity, L.A. residents should look for new ways to save energy.

But they shouldn't be discouraged if the state still finds itself short of power for many more months, maybe years, ahead, and Edison finds itself in bankruptcy court. The supply shortage is very real and will not bend easily to anyone's political will.