EnXco, which operates about 300 MW of wind, had 10 MW off-line that week because the turbines could not be maintained or components repaired or replaced because of the cash crunch. "This is the terrible domino effect from the failure of [Southern California] Edison and PG&E to pay and from the failure of the governor and legislature to address our problems," said an angry Kelly Lloyd, chief financial officer of EnXco, formerly FORAS. "This is already a worst case scenario."
The company, which was owed $5 million as of the second half of March, had stopped all capital purchases and was no longer offering workers over-time, although it had yet to lay anyone off. And it might have as much as 100 MW of wind turbines not operating by the middle or end of April, said Lloyd, if it did not receive assurances that it will be paid.
As rumours spread that renewable power plants were taking plants off-line to make a political point, the wind companies were considering their legal options to try and stave off more disaster. When Coram Energy Group, a wind power operator based in Tehachapi, signed an involuntary bankruptcy petition against Southern California Edison (SCE), the act was felt even on Wall Street. If two other companies join Coram's petition, they can force SCE into bankruptcy as long as they are owed a total of more than $350,000. It might be the only way to save Coram, says the company's Brian O'Sullivan, a former president of the American Wind Energy Association. SCE owes Coram $350,000 -- and as of the second half of March the small wind company was down to one month's cash reserves.
EnXco and Coram are among five companies that generate wind, along with FPL Energy, CalWind Resources, and Wintec, and three other non-wind companies that have formed a creditors committee to try and collect their debts. Collectively they employ 800 in California. As of March 1 they were owed more than $500 million by the utilities SCE and Pacific Gas & Electricity. PG&E, which has made partial payments, and SCE owe a total of $1.48 billion to QFs.