* Power needed to offset loss of nuclear station
* Grid operator preparing for summer power needs
May 11 (Reuters) - Two retired power plants owned by AES Corp have been restarted to help the California grid operator replace lost generation from the damaged San Onofre nuclear station, the state agency said Friday.
Huntington Beach Units 3 and 4, natural gas-fired units with total capacity of 440 megawatts, are back in service and available for dispatch, the California Independent System Operator (ISO) said in a statement.
The ISO signed contracts with AES under its capacity procurement mechanism for a 30-day period which can be extended, the agency said.
The grid agency is working to prepare Southern California for a summer season without the 2,150-MW San Onofre station which has been shut since January.
The ISO is also working with utilities to complete two transmission projects and plans to utilize more conservation efforts as summer demand climbs.
Both San Onofre nuclear units, located half way between San Diego and Los Angeles, were shut due to premature wear found on tubes in the massive steam generators.
Earlier this week, nuclear regulators squelched talk of a June restart at San Onofre following conflicting statements from officials of Southern California Edison, a unit of Edison International, which operates the plant and holds a 78-percent ownership stake.
While San Onofre's location makes it an integral part of Southern California's high-voltage transmission system, the nuclear watchdog will not rush its process to determine when the units should restart.
While the staff of the ISO said the likelihood of rolling blackouts is low, extreme weather or other power plant or transmission-related problems could occur.
The 1950s-era Huntington units, which AES retired at the end of 2011, would add generation in Southern California and, more importantly, bolster the transmission system to allow power from outside the state to flow to San Diego, the state's second largest city, ISO officials said previously.
Southern California relies more heavily on power imported than does Northern California, the ISO said.
The units were previously taken out of service in the mid-1990s, but restarted in 2003- following the 2001 California energy crisis, according to a company filing.
Officials at NRG Energy said earlier this month that NRG's Encina gas-fired plant in San Diego saw significantly higher operating time in the first quarter due to the San Onofre outage.