As we face a time of electric shortages and potential blackouts, it may or may not be a comfort to learn that this is nothing new. The story of power in Los Angeles has long been a story of lacks: as with water in Southern California, there often has not seemed to be enough of it. The story of power in LA is also a story of struggle: between wealthy investors and the city and county over control and profits, and later between state agencies, the legislature and irritated consumers.

Today, Southern California has two companies that keep the lights on: the Los Angeles Department of Water and Power (DWP) serves business and residences within the city limits of Los Angeles as well as portions of the Owens Valley. Southern California Edison (SCE) serves everybody else.

Los Angeles Department of Water and Power

While the power crisis has the rest of California fretting about price gouging and rolling blackouts, the city of Los Angeles can rest assured that the City of Angels will remain plugged in, thanks to the Los Angeles Department of Water and Power.

But the DWP has a long and spotty past. In 1902, under the leadership of William Mulholland, the Department of Water and Power established the first municipal water works system in LA.

In 1905, LA's first power plant was built at Division Creek in the Owens Valley. The plant generated power from water for the purpose of constructing an aqueduct. This was the first time electric energy had been used in such a construction project.

In 1909, The Bureau of Los Angeles Aqueduct Power was established, with Ezra F. Scattergood as chief electrical engineer. Scattergood began preliminary engineering work for the siting of new hydro generating stations along the aqueduct.

Water from the eastern Sierra was first delivered to the city in 1913 via a 233-mile long aqueduct. It was thought to be a miracle of engineering because the water flowed by gravity from the Owens Valley to Los Angeles.

The aqueduct did more than just supply water to the city - it also brought power to Los Angeles, thanks to Scattergood's successful development of hydroelectric power along the route of the aqueduct. Scattergood became Mulholland's counterpart for the Power System, and was the driving spirit in the development of the municipal electric system.

The first power pole in Los Angeles was built in 1916. After San Francisquito Power Plant 1, north of Los Angeles, was placed in service in 1917, energy was delivered over a new transmission line. This was the beginning of distribution of municipally-generated electricity in Los Angeles.

At the end of the first decade of the century, the groundwork had been set and the plans were in motion to provide ample supplies of both water and electricity to the residents of Los Angeles, whose numbers had tripled from 102,479 in 1900 to 319,198 in 1910.

Power System

The City Power System, which began in 1917, exists under and by virtue of the Charter of the City of Los Angeles enacted in 1925.

By 1939, the City Power System, had become the sole general distributor of electric energy in Los Angeles. By 1940, the once sleepy pueblo had grown to a metropolis of 1.5 million people that provided 41 percent of the state's employment. World War II turned the city into one of the nation's top war production centers, ushering in three decades of explosive population growth and unprecedented economic diversification.

By the early 1970s, oil and natural gas were supplying about 80 percent of the energy for generating DWP electricity. But factors such as the OPEC oil embargo of 1973 and air quality standards in the city caused the DWP to rethink these methods.

As a result, the DWP launched a program of energy resource diversification that has substantially reduced the percentage of DWP electricity generated from petroleum while boosting the share produced from other fuels.

Coal is now the largest single source of power supply for Los Angeles. Natural gas supplies about 20 percent of the city's energy; hydroelectricity accounts for 12 percent; nuclear, 9 percent, and the remainder comes from purchased power, wind, biomass, solar and cogeneration.

Currently, the DWP is the largest municipally-owned utility in the nation, serving 3.8 million individuals and businesses in 464-square-miles, and supplying more than 22 million megawatt (mw) hours of electricity a year to residences. (One megawatt equals one million watts. The average resident uses about 5,000 kilowatt hours of electricity per year. A kilowatt hour is equivalent to a 100-watt light bulb operating for 10 hours.)

Business and industry consume about 70 percent of the electricity in Los Angeles, but residences constitute the largest number of customers. In addition to serving these consumers, the DWP lights public streets and highways, powers the city's water system and sells electricity to other utilities.

Southern California Edison

The other major supplier of power in the Los Angeles area is Southern California Edison. Clients of Southern California Edison are not quite as lucky as DWP customers and have been victims of blackouts and high prices.

Unlike the DWP, SCE is an investor-owned electric utility company. In fact, it is the second largest in the nation.

With 4.2 million business and residential customers spanning a 50,000 square mile service area in coastal, central, and southern California, SCE's transmission facilities include almost 12,000 circuit miles of lines and 800 substations. Its distribution system, taking power from substations to the customer, includes 88,000 circuit miles of line connecting 1.5 million poles, 642,000 transformers, and 490,000 street lights.

SCE's beginnings date to the turn of the 20th Century. Originally there were several power companies serving Southern California, but four of these were the true ancestors of SCE: a company that provided electric lighting for Visalia, the Santa Barbara Electric Company, and a third company that provided electricity for Riverside, Highgrove and Colton. The last link in the chain was the West Side Lighting Company, organized by a group of investors headed by Elmer E. Peck in 1896. Peck's original goal was to try to secure an electric plant operating franchise from the city of Los Angeles, but he had no luck. In the end he went to the LA County Supervisors, who granted him a franchise to operate a plant outside the city limits.

By the mid-1890s, most LA streets were mazes of overhanging telegraph, telephone, fire alarm, trolley, and electric wires. In 1896 the city passed an ordinance prohibiting most overhead line construction. The West Side Lighting Company realized that to extend their lines and business, the best system was the Edison three-wire conduit technology, invented and patented by Thomas Edison. There was a problem with them acquiring a license: in 1894 a group of San Francisco financiers obtained a licence from Thomas Edison's General Electric Company and organized a company called the Los Angeles Edison Electric Company. This was pure speculation on their part: the company never owned or operated a power plant. But they did have exclusive rights to Edison's patented conduit technology. After some wheeling and dealing, West Side Lighting and Los Angeles Edison reached an agreement, and a new company was formed: the Edison Electric Company of Los Angeles. This new company promptly began expanding its service area, building power plants and power lines into areas that had previously had none. It also set about buying up existing local companies like Pasadena Electric Light and Power Company and the Santa Ana Gas and Electric Company. In 1909 the company was renamed the Southern California Edison Company, to better reflect the scope of its service area. Over the next decades, SCE built dams and power plants throughout Southern California, to meet the demands of a rapidly growing population.

History of Regulation

A word that has been getting tossed around a lot in the past few months is deregulation. But before there was deregulation, there was regulation. And for regulation's beginnings we must turn the clock back to the early 1900s. As the various small utility systems combined and consolidated, the public became increasingly concerned about the prices these new, larger companies could charge. So in 1912, following the passage of the Public Utilities Act of 1911, the state assigned the elected Railroad Commission regulatory authority over a range of private companies including the burgeoning power industry so critical to the community welfare that the U.S. Supreme Court in 1877 had found them to be "clothed with a public interest." Things were fairly stable for several decades (the Railroad Commission changed its name to the Public Utilities Commission in 1946) until the energy crisis of the 1970s and early 1980s. The PUC suffered from two major shortcomings: by giving companies a guaranteed rate of return on expenses, the utilities were encouraged to build more plants, hire more people and focus on the short-term horizon between rate cases -- which contributed to reliability but put constant upward pressure on prices, and while the PUC controlled the investor-owned energy utilities, it had little sway over the broader policies that determined how energy was produced and consumed. So in 1974 the California Energy Commission was formed to deal with energy use, planning, and conservation. The Energy Commission committed the state to more environmentally friendly (and expensive) power, increasing energy costs. By the 1990s, electricity rates were 50 percent higher than they were on average across the rest of the nation.

In 1995, the PUC voted to open California's electricity industry to competition. In this new vision, consumers would be able to choose their own energy provider, and the increased competition between these providers would mean lower prices for energy. In 1995 the State Legislature made it law. So far so good, but there was a fatal flaw in the plan: the law required the utilities to shed their generating and transmission facilities, to freeze rates until they completed the sale of their assets, and buy power in a huge open auction market for electricity, known as the Power Exchange where supply and demand were matched every day and hour. In this commodities market, wholesale energy prices soared, but the utilities were unable to increase the rates they charged their customers, leading them deeply into debt and bringing us to our current state of crisis. The final irony is that very few people have switched electricity providers since choice became available: less than 1 percent of residential customers, and 15 to 20 percent of industrial consumers.

What the Future Holds

So what lies ahead? The most immediate problem facing SCE is its financial well-being. It has been teetering on the brink of bankruptcy for several months, and a true solution has proved elusive. Conservation efforts and increased supplies have prevented wide scale blackouts. Current plans under consideration include the purchase by the state of California of SCE's transmission lines, and erasing a large portion of SCE's debt. Will deregulation survive? In all likelihood, yes, it will. Other states are following in California's footsteps and deregulating their utilities (but they are not instituting the price freezes that drove our utilities into near bankruptcy). And deregulation need not be a bad thing, as some of the more imaginative ideas for future power supplies indicate.

Some fundamental problems remain. How does California balance a growing population of energy-hungry consumers with environmental concerns that accompany the construction of new power plants? In this field, the DWP has shown the most vision. The Green LA project is a renewable energy program aimed at promoting the use of environmentally-friendly power sources like sun, wind, and water. Part of this project is a solar energy program, offering incentives to DWP customers who install solar systems in their homes.

Another exciting idea for the future would place power generation in the hands of each consumer: we would all be energy providers and vendors utilizing low emission backyard power systems. All of these systems would contribute power to the larger grids. Power to the people, indeed!*

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References

1. Blackout: The Energy Crisis. Originally aired on PBS's Frontline on June 5, 2001.
2. Energy Crisis Overview: How We Got Here. SF Gate, 2001.
3. The Energy Web. Wired, July 2001.
4. Los Angeles Department of Water and Power History.
5. Myers, William A., Iron Men and Copper Wires: A Centennial History of the Southern California Edison Company.
Glendale, Calif. : Trans-Anglo Books, c1983.
6. Southern California Edison Company - Early Vignette.

Photo Credits

From the top of the page:

1. DWP plant opening. May 1957. Regional History Collection, Water & Power-Plants-Installations. Boulder Canyon transmission line in the high mesa west of Victorville. Late 1930s. Regional History Collection, Industry-Electric-#1.
2. Boulder Canyon transmission line in the high mesa west of Victorville. Late 1930s. Regional History Collection, Industry-Electric-#1.
3. Boiler room, plant #3, Long Beach steam station, Southern California Edison Company. Regional History Collection, Industry-Electric-#1 (CHS/LAACC).
4. Transformers operating at 220,000 volts to supply power to LA 200 miles away. Sept 1929. Regional History Collection, Industry-Electric-#2. (CHS/LAACC).
5. One of the immense dams built by the Southern California Edison Company at Huntington Lake. Regional History Collection, Industry-Electric-#1 (CHS/LAACC).
6. Aerial view of Long Beach steam plant, Southern California Edison Company. April 17, 1925. Regional History Collection, Industry-Electric-#1 (CHS/LAACC).
7. Interior shot of Scattergood steam plant shows huge round domed electric generator in mid-ground. January 1960. Regional History Collection, Industry-Electric-#1. Los Angeles Examiner collection.
8. Interior shot of Scattergood steam plant shows huge round domed electric generator in mid-ground. January 1960. Regional History Collection, Industry-Electric-#1. Los Angeles Examiner collection.

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