25 September 2002 – San Diego Gas & Electric (SDG&E) has formally issued a Request for Offers (RFO) to prospective sellers of electricity to buy electricity and generating capacity to cover the utility’s “net short” energy requirements starting on Jan. 1, 2003.

Net short is the difference between the amount of electricity needed to cover SDG&E’s customer demand and the power provided by existing contracts, including the long-term power contracts recently allocated to the customers of SDG&E by the California Department of Water Resources (CDWR). Because the CDWR has already purchased a substantial amount of electricity on behalf of the state for many years to come, the remaining net-short amount of additional electricity SDG&E needs to buy is only a small percentage of the utility’s overall estimated load forecast from 2003 through 2007.

The RFO is in response to a decision Aug. 22, 2002, by the California Public Utilities Commission (CPUC) authorizing the state’s three investor-owned utilities to begin buying power again to cover their net-short needs. The CPUC authorized the utilities to enter into contracts of up to five years for power from traditional sources, and up to 15-year contracts from renewable sources.

The CDWR has been buying electricity to meet the combined net-short needs of SDG&E, Southern California Edison and PG&E since early 2001, but the agency’s power-buying authority expires on Dec. 31, 2002.

SDG&E sent the RFO directly to 188 prospective suppliers, including companies with renewable sources, as well as demand-response resources.

“We’ve tried to target all the companies that may be interested in responding to our request, but we encourage other generators to contact us,” said Lad Lorenz, SDG&E’s director of fuel and power. “Our goal is to meet 1 percent of our overall energy needs in 2003 with power from renewable resources, and we hope that some of these new contracts will help us achieve that.”

Responses to the RFO are due to SDG&E by 8 a.m. Sept. 30, 2002. Companies interested in responding can get more information from SDG&E’s Web site at www.sdge.com/rfo.html .

SDG&E is a regulated public utility that provides service to 3 million consumers through 1.3 million electric meters and 775,000 natural gas meters in San Diego and southern Orange counties. SDG&E is part of Sempra Energy Utilities, the umbrella for Sempra Energy’s regulated business units. Sempra Energy (NYSE: SRE – News) is a Fortune 500 energy services holding company based in San Diego.

Source: San Diego Gas & Electric