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California Fires Trigger L.A. Power Price Surge: Energy Markets

Los Angeles wholesale power will probably reach record premiums versus prices in San Francisco this summer as the long-distance transmission lines needed to make up for reduced local capacity are threatened by wildfires.

Southern California power spreads have already jumped to their widest of the year as the region has been unable to replace the generating capacity lost with the permanent shutdown of the San Onofre nuclear plant. Hydroelectric output, which normally supplies about 15 percent of the state’s power, has dropped to the lowest level since 2008.