Message-ID: <23007621.1075840622101.JavaMail.evans@thyme> Date: Tue, 12 Dec 2000 04:18:00 -0800 (PST) From: carla.hoffman@enron.com To: tim.belden@enron.com, robert.badeer@enron.com, jeff.richter@enron.com, phillip.platter@enron.com, mike.swerzbin@enron.com, diana.scholtes@enron.com, sean.crandall@enron.com, matt.motley@enron.com, mark.guzman@enron.com, tom.alonso@enron.com, mark.fischer@enron.com Subject: DJ US Southwest Pwr Mkt Rises On Unit Outage, CalPX Chaos Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Carla Hoffman X-To: Tim Belden, Robert Badeer, Jeff Richter, Phillip Platter, Mike Swerzbin, Diana Scholtes, Sean Crandall, Matt Motley, Mark Guzman, Tom Alonso, Mark Fischer X-cc: X-bcc: X-Folder: \mark guzman 6-28-02\Notes Folders\All documents X-Origin: GUZMAN-M X-FileName: mark guzman 6-28-02.nsf ---------------------- Forwarded by Carla Hoffman/PDX/ECT on 12/12/2000 12:26 PM --------------------------- Enron Capital & Trade Resources Corp. From: "Pergher, Gunther" 12/12/2000 10:51 AM To: undisclosed-recipients:; cc: Subject: DJ US Southwest Pwr Mkt Rises On Unit Outage, CalPX Chaos 17:13 GMT 12 December 2000 DJ US Southwest Pwr Mkt Rises On Unit Outage, CalPX Chaos NEW YORK (Dow Jones)--Prices for prescheduled power in the southwestern U.S. rose Tuesday due to a unit outage and uncertainty about the market rules of the California Power Exchange, traders said. The 498-megawatt San Juan coal-fired unit 4 in New Mexico tripped off the grid Monday due to a tube leak, but it is expected back on line Tuesday night. Traders also said total uncertainty about the market rules in California have thrown the market into chaos. On Sunday, the California Power Exchange cleared power sales at prices above $250/MWh because the Federal Energy Regulatory Commission approved an emergency request from the California Independent System Operator to move to a new "soft" price cap. The ISO asked to be able to purchase power for more than $250 a megawatt-hour, so long as any seller agrees to provide documentation on costs to justify the high price. In time, the FERC could reduce prices for any sales above $250/MWh if the FERC deems the price unreasonable, according to the "soft" cap rules originally proposed by FERC. The CalPX says that its day-ahead market has also moved to the soft price cap, but the ISO on Sunday constrained almost all CalPX prices for Monday down to $250/MWh, from an average of $611.53/MWh. The ISO staff and middle managers apparently don't believe the new soft-cap applies to the CalPX market, though late Monday the ISO constrained some prices for Tuesday down to $250-$500/MWh but left the CalPX clearing prices for nine hours unchanged at $926.34-$1,020.99/MWh. Traders said Tuesday that no ISO constrained pricing formula comes up with even figures as $280/MWh and $500/MWh, and that somebody at the ISO is just making up prices arbitrarily. With all the uncertainty about what final prices will be, suppliers avoided the CalPX market Monday and Tuesday. With fewer sell offers and steady demand, the CalPX has risen sharply higher than the bilateral market. The much-higher CalPX clearing prices Monday, in turn, pushed the southwest bilateral market higher early Tuesday, traders said On-Peak/MWh 1 Day Previous Palo Verde $ 400.00-$ 520.00 $ 300.00-$ 375.00 Mid-Columbia 650.00- 850.00 750.00- 1,000.00 COB 600.00- 800.00 700.00- 900.00 After the bilateral market completed most of its trading, the CalPX posted Wednesday on-peak clearing prices that averaged $1,406.76/MWh, up $417. How the ISO may change those prices later Tuesday is unknown. The CalPX made an emergency filing late Monday with the FERC to include its market in the new "soft" cap rules. -By Mark Golden, Dow Jones Newswires; 201-938-4604; mark.golden@dowjones.com (END) Dow Jones Newswires 12-12-00 1713GMT 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.