Message-ID: <20110747.1075855472701.JavaMail.evans@thyme> Date: Thu, 7 Dec 2000 01:09:00 -0800 (PST) From: phillip.allen@enron.com To: mike.grigsby@enron.com, keith.holst@enron.com, frank.ermis@enron.com Subject: DJ Cal-ISO Pays $10M To Avoid Rolling Blackouts Wed -Sources, DJ Calif ISO, PUC Inspect Off-line Duke South Bay Pwr Plant, DJ Calif Regula tors Visit AES,Dynegy Off-Line Power Plants Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Phillip K Allen X-To: Mike Grigsby, Keith Holst, Frank Ermis X-cc: X-bcc: X-Folder: \Frank_Ermis_Dec2000\Notes Folders\All documents X-Origin: Ermis-F X-FileName: fermis.nsf ---------------------- Forwarded by Phillip K Allen/HOU/ECT on 12/07/2000 09:08 AM --------------------------- Jeff Richter 12/07/2000 06:31 AM To: Phillip K Allen/HOU/ECT@ECT cc: Subject: DJ Cal-ISO Pays $10M To Avoid Rolling Blackouts Wed -Sources, DJ Calif ISO, PUC Inspect Off-line Duke South Bay Pwr Plant, DJ Calif Regula tors Visit AES,Dynegy Off-Line Power Plants ---------------------- Forwarded by Jeff Richter/HOU/ECT on 12/07/2000 08:38 AM --------------------------- Carla Hoffman 12/07/2000 06:19 AM To: Tim Belden/HOU/ECT@ECT, Robert Badeer/HOU/ECT@ECT, Jeff Richter/HOU/ECT@ECT, Phillip Platter/HOU/ECT@ECT, Mike Swerzbin/HOU/ECT@ECT, Diana Scholtes/HOU/ECT@ECT, Sean Crandall/PDX/ECT@ECT, Matt Motley/PDX/ECT@ECT, Mark Guzman/PDX/ECT@ECT, Tom Alonso/PDX/ECT@ECT, Mark Fischer/PDX/ECT@ECT, Monica Lande/PDX/ECT@ECT cc: Subject: DJ Cal-ISO Pays $10M To Avoid Rolling Blackouts Wed -Sources, DJ Calif ISO, PUC Inspect Off-line Duke South Bay Pwr Plant, DJ Calif Regula tors Visit AES,Dynegy Off-Line Power Plants ---------------------- Forwarded by Carla Hoffman/PDX/ECT on 12/07/2000 06:29 AM --------------------------- Enron Capital & Trade Resources Corp. From: "Pergher, Gunther" 12/07/2000 06:11 AM To: undisclosed-recipients:; cc: Subject: DJ Cal-ISO Pays $10M To Avoid Rolling Blackouts Wed -Sources, DJ Calif ISO, PUC Inspect Off-line Duke South Bay Pwr Plant, DJ Calif Regula tors Visit AES,Dynegy Off-Line Power Plants 13:18 GMT 7 December 2000 DJ Cal-ISO Pays $10M To Avoid Rolling Blackouts Wed -Sources (This article was originally published Wednesday) LOS ANGELES (Dow Jones)--The California Independent System Operator paid about $10 million Wednesday for 1,000 megawatts of power from Powerex and still faced a massive deficit that threatened electricity reliability in the state, high-ranking market sources familiar with the ISO's operation told Dow Jones Newswires. But the ISO fell short of ordering rolling blackouts Wednesday for the third consecutive day. The ISO wouldn't comment on the transactions, saying it is sensitive market information. But sources said Powerex, a subsidiary of British Columbia Hydro & Power Authority (X.BCH), is the only energy company in the Northwest region with an abundant supply of electricity to spare and the ISO paid about $900 a megawatt-hour from the early afternoon through the evening. But that still wasn't enough juice. The Los Angeles Department of Water and Power sold the ISO 1,200 megawatts of power later in the day at the wholesale electricity price cap rate of $250/MWh. The LADWP, which is not governed by the ISO, needs 3,800 megawatts of power to serve its customers. It is free sell power instate above the $250/MWh price cap. The LADWP has been very vocal about the amount of power it has to spare. The municipal utility has also reaped huge profits by selling its excess power into the grid when supply is tight and prices are high. However, the LADWP is named as a defendant in a civil lawsuit alleging price gouging. The suit claims the LADWP sells some of its power it gets from the federal Bonneville Power Administration, which sells hydropower at cheap rates, back into the market at prices 10 times higher. Powerex officials wouldn't comment on the ISO power sale, saying all transactions are proprietary. But the company also sold the ISO 1,000 megawatts Tuesday - minutes before the ISO was to declare rolling blackouts - for $1,100 a megawatt-hour, market sources said. The ISO, whose main job is to keep electricity flowing throughout the state no matter what the cost, started the day with a stage-two power emergency, which means its operating reserves fell to less than 5%. The ISO is having to compete with investor-owned utilities in the Northwest that are willing to pay higher prices for power in a region where there are no price caps. The ISO warned federal regulators, generators and utilities Wednesday during a conference call that it would call a stage-three power emergency Wednesday, but wouldn't order rolling blackouts. A stage three is declared when the ISO's operating reserves fall to less than 1.5% and power is interrupted on a statewide basis to keep the grid from collapsing. But ISO spokesman Patrick Dorinson said it would call a stage three only as a means of attracting additional electricity resources. "In order to line up (more power) we have to be in a dire situation," Dorinson said. Edison International unit (EIX) Southern California Edison, Sempra Energy unit (SRE) San Diego Gas & Electric, PG&E Corp. (PCG) unit Pacific Gas & Electric and several municipal utilities in the state will share the cost of the high-priced power. SoCal Edison and PG&E are facing a debt of more than $6 billion due to high wholesale electricity costs. The utilities debt this week could grow by nearly $1 billion, analysts said. It's still unclear whether retail customers will be forced to pay for the debt through higher electricity rates or if companies will absorb the costs. -By Jason Leopold, Dow Jones Newswires; 323-658-3874; jason.leopold@dowjones.com (END) Dow Jones Newswires 07-12-00 1318GMT Copyright (c) 2000, Dow Jones & Company Inc 13:17 GMT 7 December 2000 DJ Calif ISO, PUC Inspect Off-line Duke South Bay Pwr Plant (This article was originally published Wednesday) LOS ANGELES (Dow Jones)--Representatives of the California Independent System Operator and Public Utilities Commission inspected Duke Energy Corp.'s (DUK) off-line 700-MW South Bay Power Plant in Chula Vista, Calif., Wednesday morning, a Duke spokesman said. The ISO and PUC have been inspecting all off-line power plants in the state since Tuesday evening to verify that those plants are shut down for the reasons generators say they are, ISO spokesman Pat Dorinson said. About 11,000 MW of power has been off the state's power grid since Monday, 7,000 MW of which is off-line for unplanned maintenance, according to the ISO. The ISO manages grid reliability. As previously reported, the ISO told utilities and the Federal Energy Regulatory Commission Wednesday that it would call a stage three power alert at 5 PM PST (0100 GMT Thursday), meaning power reserves in the state would dip below 1.5% and rolling blackouts could be implemented to avoid grid collapse. However, the ISO said the action wouldn't result in rolling blackouts. The ISO and PUC also inspected Tuesday plants owned by Dynegy Inc (DYN), Reliant Energy Inc. (REI) and Southern Energy Inc (SOE). Duke's 1,500-MW Moss Landing plant was also inspected by PUC representatives in June, when some units were off-line for repairs, the Duke spokesman said. -By Jessica Berthold, Dow Jones Newswires; 323-658-3872; jessica.berthold@dowjones.com (END) Dow Jones Newswires 07-12-00 1317GMT Copyright (c) 2000, Dow Jones & Company Inc 13:17 GMT 7 December 2000 =DJ Calif Regulators Visit AES,Dynegy Off-Line Power Plants (This article was originally published Wednesday) By Jessica Berthold Of DOW JONES NEWSWIRES LOS ANGELES (Dow Jones)--AES Corp. (AES) and Dynegy Inc. (DYN) said Wednesday that representatives of California power officials had stopped by some of their power plants to verify that they were off line for legitimate reasons. The California Independent System Operator, which manages the state's power grid and one of its wholesale power markets, and the California Public Utilities Commission began on-site inspections Tuesday night of all power plants in the state reporting that unplanned outages have forced shutdowns, ISO spokesman Pat Dorinson said. The state has had 11,000 MW off the grid since Monday, 7,000 MW for unplanned maintenance. The ISO Wednesday called a Stage 2 power emergency for the third consecutive day, meaning power reserves were below 5% and customers who agreed to cut power in exchange for reduced rates may be called on to do so. As reported earlier, Reliant Energy (REI) and Southern Energy Inc. (SOE) said they had been visited by representatives of the ISO and PUC Tuesday evening. Representatives of the two organizations also visited plants owned by AES and Dynegy Tuesday evening. AES told the visitors they couldn't perform an unannounced full inspection of the company's 450-megawatt Huntington Beach power station until Wednesday morning, when the plant's full staff would be present, AES spokesman Aaron Thomas said. Thomas, as well as an ISO spokesman, didn't know whether the representatives returned Wednesday for a full inspection. AES Units Down Due To Expired Emissions Credits The Huntington Beach facility and units at two other AES facilities have used up their nitrogen oxide, or NOx, emission credits. They were taken down two weeks ago in response to a request by the South Coast Air Quality Management District to stay off line until emissions controls are deployed, Thomas said. AES has about 2,000 MW, or half its maximum output, off line. The entire Huntington plant is off line, as is 1,500 MW worth of units at its Alamitos and Redondo Beach plants. The ISO has asked AES to return its off line plants to operations, but AES has refused because it is concerned the air quality district will fine the company $20 million for polluting. "We'd be happy to put our units back, provided we don't get sued for it," Thomas said. "It's not clear to us that the ISO trumps the air quality district's" authority. As reported, a spokesman for the air quality district said Tuesday that AES could have elected to buy more emission credits so that it could run its off line plants in case of power emergencies, but choose not to do so. Dynegy's El Segundo Plant Also Visited By PUC Dynegy Inc. (DYN) said the PUC visited its 1,200 MW El Segundo plant Tuesday evening, where two of the four units, about 600 MW worth, were off line Wednesday. "I guess our position is, 'Gee, we're sorry you don't believe us, but if you need to come and take a look for yourself, that's fine,'" said Dynegy spokesman Lynn Lednicky. Lednicky said one of the two units was off line for planned maintenance and the other for unplanned maintenance on boiler feedwater pumps, which could pose a safety hazard if not repaired. "We've been doing all we can to get back in service," Lednicky said. "We even paid to have some specialized equipment expedited." Lednicky added that the PUC seemed satisfied with Dynegy's explanation of why its units were off line. -By Jessica Berthold, Dow Jones Newswires; 323-658-3872, jessica.berthold@dowjones.com (END) Dow Jones Newswires 07-12-00 1317GMT Copyright (c) 2000, Dow Jones & Company Inc G_nther A. Pergher Senior Analyst Dow Jones & Company Inc. Tel. 609.520.7067 Fax. 609.452.3531 The information transmitted is intended only for the person or entity to which it is addressed and may contain confidential and/or privileged material. Any review, retransmission, dissemination or other use of, or taking of any action in reliance upon, this information by persons or entities other than the intended recipient is prohibited. If you received this in error, please contact the sender and delete the material from any computer.