MID 2004 Annual Report and Consolidated Financial Statements

Photo of old and new windmills

Something’s in the Wind

Everyone needs something to argue about, and in California it’s usually water.

As 2004 drew to a close, a myriad of legislative, regulatory, and popular proposals were being debated. Some proposals would raise costs, some would alter long-established ways of operating waterways, and some could be a prelude to challenging water rights. All bear close watching to determine what impact they might have on MID customers.

Here are some of the things blowing our way:

  • Proposals for water fees due to the state’s ongoing budget troubles. These fees could increase operating costs without providing any additional service to MID customers.
  • A grassroots proposal to restore the Hetch Hetchy Valley. This idea has gained political steam, even though there’s no money to pay for it and no plan to replace the water storage that would be lost. It’s not yet clear how this plan might impact MID customers.
  • Stricter regulations on water that drains from MID canals into local rivers. How much this will cost MID ratepayers is unknown.

The wind is stirring things up on the electric side, too. Sustained high natural gas prices have put upward pressure on electric rates. In addition, MID’s customer base continues to grow at breakneck speed.

MID remains committed to maintaining an adequate supply of electricity to meet customer needs. To fulfill that promise, we’re investing upwards of $175 million in new and upgraded power plants, contracts to purchase power from others, and transmission access.

Sadly, the same cannot be said for California’s utility industry as a whole. Customer-owned utilities like MID are investing responsibly in infrastructure and power resources, but large investor-owned utilities lag behind. In Sacramento, legislators are still debating whether, or how, to deal with energy deregulation going forward. Our state is left vulnerable to a potential repeat of power shortages and rolling blackouts.

Many people look to renewable energy for salvation from high prices and power shortages. Few understand that to “go green” you must spend more green. Renewable energy will be a valuable component of MID’s energy resource mix. We’re excited about making our first investment in wind generation in 2004. But I caution that when the state mandates investing in green energy, costs are going to rise.

Next - Wind Generates Excitement >>

Allen Short MID  General Manager

Signiture of Allen Short
Allen Short,
General Manager

Produced by the MID Public Affairs Department. To order a printed copy of the MID 2004 Annual Report, contact the MID Finance & General Services Division at (209) 526-7473.

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