NRG CEO Crane stays mum on potential California contracts

NRG Energy (NYSE:NRG) CEO David Crane said Aug. 7 that he wasn’t going to predict when the independent power producer might find out the fate about potential power contracts for its affiliates in Southern California.

During NRG’s quarterly earnings conference call, an analyst noted that Crane didn’t say much about California in his main presentation. The analyst went on to ask Crane about potential contracts with Sempra utility subsidiary San Diego Gas & Electric (SDG&E) and Edison International utility Southern California Edison (SCE).

In July, SDG&E sought California Public Utilities Commission (CPUC) approval to enter into a power purchase tolling agreement with NRG’s 630-MW Carlsbad gas plant.  Meanwhile, SCE will need resources to help compensate for the retirement of the 2,000-MW-plus San Onofre nuclear station.

“We always like to promise things we know we can deliver on,” Crane replied. “We are very pleased with San Diego Gas & Electric’s submission of the power purchase agreement.” But NRG cannot predict when the CPUC might make a decision on the issue.

“Predicting when government acts is something we don’t get in the business of,” Crane said. “We are very excited about that project,” Crane said in reference to Carlsbad.

“We look forward to the day that the California Public Utilities Commission acts upon that,” Crane said. “We can continue to add to the stability of the electricity supply in Southern California,” the NRG CEO said.

In March, CPUC directed SCE and SDG&E to procure energy supplies, including natural gas and alternatives like renewables and energy efficiency.

As for any potential business with SCE, such submissions are governed by confidentiality agreements, Crane said. “You may have to ask them as to what their timing is,” he added.

Nevertheless, NRG Energy would be prepared to provide both “conventional generation” and “preferred resources,” such as renewable energy, Crane said.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.