California district-heating plan periled; users may have to buy boilers

If investors back out of an Oakland, California cogeneration/district heating plan because the Public Utilities Commission insists on a lower 1986 buy-back rate, potential users expecting cheap steam and chilled water will have to use higher cost boilers and chillers. The plan to reduce the 1986 buy-back rate from 7.8 cents per kWh to 7.0 cents is designed to avoid penalizing ratepayers in order to subsidize cogeneration, but it may be too low to make the project feasible. The project is part of a downtown redevelopment plan. (DCK)