Californian Tech Firms Struggle With Energy Crisis

It's not like the California power shortage caught Silicon Valley by surprise. The power shortage was hammered home brutally last June, when a 109 degree day overloaded the power grid, and rolling blackouts cost high-tech firms millions of dollars.

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Doing something about it is something else, especially when the solution clashes with the area's environmentalist mindset.

After the summer's power outage, Pacific Gas and Electric bought a portable floating power plant in Texas and shipped it through the Panama Canal, planning to anchor it in the San Francisco Bay and pump in 95 megawatts of power.

But the company pulled back a few weeks later, convinced it couldn't win local government approval over environmental protests. The last heard of the floating power plant, it was moored off the coast of Oregon, waiting for somewhere to go.

Around the same time, the city of San Jose was mulling a plan for a power plant on its southern edge that would have produced enough juice for 600,000 homes.

The plant's largest problem -- it was on the edge of networking giant Cisco's (CSCO Quote) planned 20,000-worker headquarters and campus in an area known as Coyote Valley. Cisco objected to the plant's looks and possible pollution -- although it was backed by both the Sierra Club and consumers' groups.

Cisco joined with nearby residents in pressuring the San Jose City Council to veto the power plant. The council obliged, killing the project six weeks ago, a decision that may be reversed by a state agency. The company that proposed the plant has since suggested a location for a new plant on the bare hills of a range 25 miles east of Silicon Valley.

Not that Cisco is immune to the same concerns. Earlier this week, San Jose citizens turned in 43,000 signatures demanding a citywide vote on Cisco's campus plans. Why? Because they believe it's an environmental mistake.

There's still hope for some relief. Staff members of the state's energy commission have recommended that the agency approve a small, temporary plant to be build near San Francisco's airport despite early opposition from a Silicon Valley nonprofit that promotes renewable energy.