96 Generation Gap a Threat to Region, John Webster, The Spokesman Review

Generation Gap a Threat to Region
by John Webster, editorial board
The Spokesman Review, December 12, 2000

Plentiful, affordable electricity is a necessity, not a frill.

Spokane -- Kaiser's frustrated, laid-off Steelworkers are not alone. Blue-collar jobs at power-hungry industries all over our region are in jeopardy. The cause? The Northwest and California have grown, but have failed to increase electrical generating capacity accordingly.

That's why managers of the West's electrical distribution grid are struggling right now to avoid blackouts as cold weather causes power demand to exceed supply.

That's why prices for natural gas also have gone into orbit, forcing utilities, including Spokane's Avista Corp., to request additional rate increases to cover their costs. Natural gas is the much-in-demand fuel for turbines, the only large-scale electrical generating technology that remains viable in a region where new projects face a gantlet of economic, political and regulatory challenges.

And, the chaotic energy market is the reason why Kaiser shut down its Mead aluminum smelter until next fall.

Stung by a layoff that follows a painful strike and comes two weeks before Christmas, some Steelworkers are lashing out at Kaiser's management for its decision to sell the company's power allotment instead of using it to make aluminum. However, if Kaiser management were the issue, similar shutdowns would not be occurring elsewhere around the region. In fact, production cuts due to power costs are occurring at other companies and in other industries.

Last week, Columbia Falls Aluminum announced a production cutback for the second time this year at its smelter in Montana.

Alcan Aluminum has cut production at a plant in Kitimat, B.C.

Georgia-Pacific Corp. is closing a paper mill (another power-intensive industry) in Bellingham, laying off 800.

Those are only a few recent examples of cuts that have been occurring for months. More are likely.
It is cold comfort, but most workers being laid off from Mead will continue to get up to 70 percent of their pay, plus medical benefits.
For all laborers, the larger concern is whether industrial employers such as Kaiser can afford to remain in the Northwest, at all, over the long term.
Kaiser's financial position may be stronger, and its survival more likely, if the company collects extra profits by idling the smelter and selling its power to others in need of it. Kaiser's option to do that ends next fall. What then? What can improve the odds Mead then will restart?
The ultimate concern -- which ought to lead the agenda for our state and federal policy makers -- is the energy shortage. Additional conservation can help relieve it. Expedited permitting for new power plants can help relieve it. Keeping Northwest power in the region, rather than exporting it, could help relieve it.
Permanent closure of basic industries could relieve it, too. But that would be a terribly damaging, and indeed temporary, solution. Power freed in that way easily could be gobbled by growth, lost to California or erased by cuts in hydroelectric production for environmental reasons.
We need more power. Demand, from the West's growing economy and population, is intense. Policy makers must plan and fight for ample, low-cost energy for all sectors of the economy.

John Webster, for the Editorial Board
Generation Gap a Threat to Region
Spokesman Review, December 12, 2000

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