A power struggle is raging in California where there is not enough electricity to keep the lights on, but more than enough blame to go around - even if a bickering array of politicians, financiers, environmentalists, consumers and technology moguls cannot agree on who or what sparked the energy crisis that has plunged large areas of the state into darkness.
One thing everyone can agree on is that the crisis, officially a state of emergency in what would be the world's seventh-largest economy, can only get much worse. The rolling blackouts are already reverberating through that economy - threatening everything from milk supplies to petrol deliveries. There is dark talk now of long queues and higher prices at the pump - and of recession.
'California is getting to the point where it's going to have a crisis that's a helluva lot bigger than the one it already has on its hands,' says Bill Greehey, the chief executive of Valero Energy, which supplies about 10 per cent of the state's petrol. 'It's going to be disastrous for our economy.'
Two-thirds of Californians polled by the Los Angeles Times say they expect a recession this year, and some Wall Street analysts have gone so far as to predict bank failures, chaos in the bond markets and a drying up of business lending, as well as job cuts.
So who is to blame? Most point to what they say is a greedy group of power generators cashing in on the state's now discredited deregulation scheme - and the politicians who passed the laws. The scheme forced utility companies to buy in electricity at soaring market rates but pre vents them from passing those costs on to consumers. Now the companies are just a filament away from bankruptcy - and no one wants to sell them any more electricity for fear they cannot pay their bills.
There is also the weather - a hot summer and a significantly colder winter - and drier than usual conditions in the Pacific North-West, limiting supplies of hydroelectric power to the US's most populous state.
Then there is the powerful environmentalist lobby, now taking heat for an array of green-friendly regulations, which have made building new power plants in California next to impossible. And, of course, consumers, who do not see why they should ever have to turn off a light when they leave a room.
And now there is a fresh target for the wrath of the newly powerless: the internet. Silicon Valley is accused of overloading California's power infrastructure.
A recent study suggests the internet now accounts for 8 per cent of national electricity consumption - and could come to consume between 30 and 50 per cent of it in 20 years . This statistic has been seized on by President George W. Bush as he seeks to justify an energy policy that will allow oil drilling and coal mining in the pristine wilderness of Alaska - but the figures are spurious, say some analysts.
The internet, after all, was supposed to conserve energy by making businesses run more efficiently - and it was widely believed that computers and wireless devices use much less energy than refrigerators or washing machines.
Not so, say the two free-market conservative analysts powering the blame-the-internet movement. Mark Mills and Peter Huber of the 'Digital Power Report' and the coal industry-funded Greening Earth Society, insist a Palm Pilot uses as much energy as a refrigerator - citing invisible 'back-end' network and telecommunications infrastructure such as routers, servers and digital transmission systems for the surge in electricity use. Power consumption in Silicon Valley, they say, has been growing at three times the rate of the rest of the California's - with Oracle, Intel, Sun Microsystems and the like using the same mega-wattage as 'a steel mill'.
But others say that's simply 'ridiculous'. Steven Taub, an analyst with Cambridge Energy Research Associates says: 'It doesn't take a lot of steel mills shutting down to offset increased demand from computers. You just can't blame my Palm Pilot for this crisis - it runs on two triple-A batteries! But the tech economy behind those devices has led to an unprecedented economic boom - and that means bigger houses, more appliances, more offices - and more demand for electricity.'
Jonathan Koomey, a scientist and the group leader of the End-Use Forecasting Group at Lawrence Berkeley National Laboratories in Berkeley, says the blackouts are not related to any such rapid increase in demand. He cites statistics from the California Energy Commission showing only a 2 per cent growth rate in electricity demand in the late 1990s at the height of the e-boom, compared with a growth rate of 3.3 per cent in the late 1980s.
'The people who want to build power plants would like everyone to think that there is huge growth in demand so we can reduce environmental regulations,' says Koomey. 'I think we have to build power plants, yes, but I also think people are trying to create a sense of urgency to make it easier for them to argue for their interests.'
Intel chief executive Craig Barrett is among a growing group of tech billionaires now pushing for the construction of new power plants as they try to avoid 'blue screen death' - the loss of millions of dollars whenever power fluctuates, even for a fraction of a second, because the chips being manufactured can be ruined. Intel, which has been operating under what Barrett calls 'mood lighting' between 4pm and 7pm when the company turns half its lights off voluntarily to conserve electricity, has already threatened to move some operations to Oregon, Arizona, New Mexico and even Israel and Ireland - unless, that is, new power plants get built, and fast.
Other giants such as Sun Microsystems, MCI WorldCom and website host Verio have resorted to diesel generators to keep their businesses humming - a trend now so pervasive that environmental regulators fear that diesel exhaust could soon add significantly to pollution.
Last Thursday, California lawmakers approved a $400 million plan to turn the lights back on. The bail-out will allow the state to buy power on the open market and provide it to the near-bankrupt utilities - Pacific Gas & Electric and Southern California Edison - at low cost. But the money won't go far. State Senate leader John Burton said: 'We can only see it getting worse.'
With no end in sight to the crisis, Californians stocked up on flashlights, candles and firewood, while hardware stores were swamped with requests from small businesses for generators.
Useful links
California Public Utilities Commission
