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CNN Today

Power Crisis: Businesses Losing Billions

Aired January 24, 2001 - 2:06 p.m. ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

NATALIE ALLEN, CNN ANCHOR: In light of the power crisis, some companies are being forced to cut working hours, and in some cases, lay off employees.

CNN national correspondent Martin Savidge is in Irwindale, where at least one plant has been forced to do just that -- Martin.

MARTIN SAVIDGE, CNN NATIONAL CORRESPONDENT: Well, Natalie, California businesses since the month of December have been taking a beating and losing billions of dollars due to the power interruptions, either from the rolling blackouts that have been taking place or the mandatory cutbacks or the contract agreements they made.

This is the Miller Brewing Company here in Irwindale, about 30 miles to the east of Los Angeles. Because of power interruptions, because of the unpredictability of those interruptions, they've had to cut back, layoff, one entire shift, the second shift -- that is 160 people. That will go on until further notice.

There was more positive news from the System's Operator today, that is the people who oversee the power grid in California. They say the situation looks better than it has done in a number of days, due to importation of more power from out of state. They also believe that two plants in the north of California that have been shut down for maintenance will be online over the weekend, producing badly needed electricity.

But for businesses, it really has been devastating financially for them. They admit they cannot continue operating under these circumstances, and they demand the state legislature to come up with some sort of long-term plan.

To give you idea of the desperation at this facility alone this afternoon, they will begin hooking up six generators, and basically be relying on the generators alone to produce the power, about 75 percent, to operate this plant because they say they can no longer rely on the local utility to provide them what they need to do business. And they're not alone. There are a lot of other businesses in the state of California that say enough is enough.

Reporting live, Martin Savidge, CNN, in Irwindale, California -- Natalie.

ALLEN: A lot of people will be paying attention to those California state legislature as they decide what to do.

Thanks, Martin Savidge.

Now for more, here's Lou.

LOU WATERS, CNN ANCHOR: If California's power shortage isn't remedied soon, there's fear the nation's economy could begin to suffer. Right now, of course, those most affected by the power crunch are the folks in California, especially home owners and the small business operators.

On phone with us now is Lorie O'Donley, an Independent System Operator out of Sacramento. Lorie, we just heard from Martin Savidge out there in California, who says that you're reporting a better than in the past -- better situation than in the past few days. What does that mean?

LORIE O'DONLEY, INDEPENDENT SYSTEM OPERATOR: ... stage three today, which has been happening for, I believe, more than a week now. The supply situation is still very tight, especially in northern California, and we're trying to find some additional resources out of state. We believe we've -- we've done that for today, and that we'll be OK, without outages.

WATERS: Now, when you look for sources out of state, is that on a day-by-day basis?

O'DONLEY: Yes, you know, basically, the population and business growth in the whole western United States has been so much that we really have a shortage throughout the region here. So yes, you know, we are -- those people have to serve their loads first, of course, and then whatever extra they may have, they're, you know, sometimes able to share with us to help out here in California.

WATERS: And what about the California lawmakers? Is there any promise there for reaching some sort of solution long term to this problem?

Well, that's definitely -- seems to be where it's going to be addressed next, and we're very hopeful that they'll be able to, you know, do something to alleviate the long-term effects here.

WATERS: Lorie O'Donley, thanks for keeping us posted. She's with ISO, the Independent Systems Operator, out of Sacramento. Those are the folks who operate the power grid in California. And it's a better day than in the past today, but tomorrow's another day.

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