FW: Energy Market Report

Until next week I am forwarding these reports. I should be able to update the webpage next week once I have rights.
Jill

-----Original Message-----
From: Energy Market Report [mailto:emr@econ.com]
Sent: Thursday, December 13, 2001 6:20 PM
To: Energy Market Report
Subject: Energy Market Report - 12/13/01

Energy Market Report
Thursday, December 13, 2001

*See attached pdf file.
__________________________________________________________
Western Pre-Scheduled Firm Electricity Prices($/MWh)
December 13, 2001 for December 14 and 15, 2001

Peak(Heavy)
Low Change High Change
NW/N. Rockies 30.25 -2.75 33.00 -2.50
Mid-Columbia 30.25 -2.75 33.00 -2.50
COB 32.00 -2.75 35.00 -1.75
N. California 32.50 -3.25 37.25 -1.75
Midway/Sylmar NA NA NA NA
S. California 31.50 -2.75 36.25 -2.75
Mead 32.50 -2.50 35.50 -3.50
Palo Verde 32.00 -2.00 36.00 -1.75
Inland SW 32.00 -2.00 36.00 -3.00
4-Corners 32.00 -2.50 34.50 -1.50
Central Rockies 26.50 -1.50 28.25 -2.00
__________________________________________________________
Off-Peak(Light)
Low Change High Change
NW/N. Rockies 25.00 0.00 27.00 -1.00
Mid-Columbia 25.00 0.00 27.00 -1.00
COB 26.00 -0.75 27.50 -2.00
N. California 27.50 0.25 31.00 -0.50
Midway/Sylmar NA NA NA NA
S. California 25.00 -0.50 27.00 -1.00
Mead 24.00 -0.50 27.00 0.50
Palo Verde 23.00 -0.50 26.50 0.00
Inland SW 23.00 -0.50 27.00 0.50
4-Corners 23.50 0.00 25.50 0.00
Central Rockies 20.00 0.00 21.50 -0.25
_________________________________________________________
Third Day in the Thirties

As traders filled out their ballots for the Friday/Saturday package, peak
power prices throughout the West shed a couple of dollars from Wednesday's
levels, but were said to remain in "pretty strong" territory. While traders
primarily blamed the softer prices on the usual expectations of lower
weekend demand, others lamented that the stronger trend of late didn't coast
into a third day of trading. "It looks like the winter could be pretty
bullish if there are additional unexpected unit outages on the horizon,"
speculated one marketer. Nonetheless, no traders expected a return to
100$/MWh territory anytime soon, with most reportedly sufficiently hedged to
meet load projections through the New Year. Helping sustain the recent
strength was another strong day in the natural gas market, with NYMEX Henry
Hub front-month pieces gaining 3.7 cents on Thursday to close at
2.756$/mmBtu, while similar goods for February were seen 2.9 cents higher
than a day ago, closing at 2.822$/mmBtu. In other news, a national
electricity deregulation bill set to go to Congress remained in committee
this week, due primarily to concerns over state rights. Such a bill would
reportedly grant authority to the Federal Energy Regulatory Commission above
current interstate powers, which has met opposition from both the 106th and
107th Congresses.

Heavy load energy costs in the Pacific Northwest fell by more than 2.5$/MWh
on lower weekend demand and weather forecasts calling for some milder
temperatures over the next several days. Peak power at the Mid-Columbia
traded between 30.25 to 33$/MWh, with the bulk of transactions taking place
around the 31.5$/MWh mark. In unit news, Colstrip #4 (700 MW), down with a
tube leak since Tuesday, had its ETR extended until Friday. Flow forecasts
for Chief Joseph were little changed, coming in at 90 kcfs Friday, 55 kcfs
Saturday, 50 kcfs Sunday, and 95 kcfs next Monday through Thursday. Weather
forecasts called for temperatures to dip slightly over the weekend, while
the latest six-to-ten from the NWS was predicting mostly above-normal
temperatures from December 19 to 23.

Despite spot natural gas prices remaining at Wednesday's robust levels and
slightly below-normal temperature forecasts for the weekend, peak power
prices in the Golden State declined a bit on Thursday. Market players said
the day was busy, but couldn't pinpoint exactly why, with generation healthy
and other fundamentals accounted for. Some hypothesized that with greater
scrutiny on the electricity market, some corporations were asking traders to
organize their books more thoroughly then usual at the end of this year.
Peak goods at NP15 changed hands between 32.5 and 37.25$/MWh, falling about
2 and 3$/MWH, respectively, off the high and low ends. The off-peak product
saw action from 27.5 to 31$/MWh, within 50 cents of Wednesday deals at both
ends. Natural gas prices at the Southern California border shaved just a
cent, trading between 2.59 and 2.64$/mmBtu. SCE's CEO Stephen Frank
reportedly will retire effective January 1, 2002. He postponed retirement
to steer the trouble utility through its bankruptcy reorganization. In unit
news, California curtailments were fairly minor on Thursday. Gas-fired unit
Crockett Cogen (260 MW), down since just Wednesday, returned to service on
Thursday. Forecasts for Friday called for highs only in the 46 to 59 degree
range at most major load centers across the state, with overnight lows in
the 35 to 46 degree range. Temperatures were expected to stay slightly
below normal through Monday, while the latest six-to-ten predicted normal
temperatures from December 19 to 23.

Amid cool temperatures and a sustained maintenance outage, peak power prices
nonetheless slumped in line with other prices in the West for the
Friday/Saturday combo in brisk Thursday trade. Heavy load pieces at Palo
Verde changed hands between 32 and 36$/MWh, losing about 2$/MWh off both
ends of the price range. In unit news, Four Corners #4 (750 MW) remained
off-line for condenser repairs, with an expected return of December 15.
Temperatures were expected to stay substantially below normal through
Sunday, with highs in the mid-50s and lows in the 30s. Warming was
predicted for Monday, with the mercury expected to climb back into the
mid-60s. The latest six-to-ten called for below-normal temperatures from
December 19 to 23.

Patrick O'Neill and Jessie Norris
_________________________________________________________

Western Generating Unit Outages

Current Begins Ends Reason
CAISO units <250/5998 total NA NA
planned/unplanned*
Alamitos #3/320/gas 04-Dec-01 ? planned
Big Creek Project/1020/hydro 09-Dec-01 ? @752MW,
planned
Colstrip #4/700/coal 11-Dec-01 14-Dec-01 tube leak*
El Segundo #3/337/gas 02-Oct-01 ? unplanned
Encina #5/332/gas 27-Oct-01 ? planned
Etiwanda #4/320/gas 08-Nov-01 ? unplanned
Four Corners #4/750/coal 10-Dec-01 15-Dec-01 repairs
Grand Coulee #19/600/hydro 10-Dec-01 March repairs
Helms PGP #2/407/hydro 01-Oct-01 ? planned
Hunter #2/472/coal 11-Dec-01 13-Dec-01 unknown
Hyatt/Thermalito/933/hydro 02-Oct-01 ? @607 MW,
unplanned
Moss Landing #6/739/gas 03-Nov-01 ? planned
Ormond Beach #2/750/gas 05-Oct-01 ? @350 MW,
unplanned
Pittsburg #6/317/gas 22-Nov-01 ? planned
Sutter Plants/546/gas 04-Dec-01 ? @235 MW,
planned

For unit owners refer to pdf version.
*Indicates a change from previous EMR.
______________________________________________________________________

Eastern Markets Pre-Scheduled Firm Power Prices ($/MWh)

December 13, 2001 for December 14, 2001

Peak (Heavy) in $/MWh
Low Change High Change
Into Cinergy 15.50 -0.50 19.00 -1.00
Western PJM 21.80 -0.30 22.70 -0.30
Into Entergy 18.50 1.25 20.00 -1.65
Into TVA 16.75 -0.25 18.50 -0.50
___________________________________________________________
Forecasts for colder weather in the new week were revised on Thursday to a
more normal outlook, causing day-ahead power prices to fall across the
Eastern Interconnect. Traders said the next week product was still changing
hands at a premium on Thursday, but most thought it would take a tumble on
Friday as the market absorbs the new forecast. NYMEX Henry Hub natural gas
futures headed higher on colder forecasts Thursday, but the upturn was
limited by the high storage levels. January gained 3.7 cents to end at
2.756$/mmBtu, while February rose 2.9 cents to close at 2.822$/mmBtu.

As the prospects for winter weather and the corresponding strong demand it
brings remained dim on Thursday, heavy load electricity prices skidded lower
in the Mid-Atlantic. Western PJM goods were bought and sold between 21.8
and 22.7$/MWh, down 30 cents to a day ago at both ends. After a brief climb
to the lofty heights of 30$/MWh, LMPs settled back into the high-teens and
averaged 16.94$/MWh through 15:00 EST. Traders reported no new major
outages, and said trading was generally quiet on Thursday. Forecasts for
Friday called for even warmer temperatures, with highs reaching the mid-60s
and lows in the also comfortable mid-50s. Cooling was expected over the
weekend, and forecasts for the first day of the new week called for highs in
the 48 to 57 degree range. The latest six-to-ten predicted below-normal
temperatures from December 19 to 23.

On mild temperatures and not much else, peak power prices softened in the
Midwest on Thursday. Into Cinergy deals were done from 15.5 to 19$/MWh,
with most transactions completed in the 17s. Trades for the front week
contract were heard around 22.55$/MWh. In other Cinergy news, the
corporation sold $275 million in convertible 3 year bonds with a 9.5% yield
on Thursday, up $25 million from the original estimate of $250 million worth
of bonds. On the unit front, nuke Dresden #3 (800 MW) remained down for
water leak repairs. High temperatures for Friday were expected in the
mid-40s, with lows about 5 degrees lower in the 34 to 40 degree range. The
five day outlook showed little change and the latest six-to-ten called for
below-normal temperatures from December 19 to 23.

Heavy load electricity prices weakened on Thursday in the Southeast,
depressed by continued warm temperatures and a healthy generation landscape.
Into Entergy goods changed hands between 18.5 and 20$/MWh, with the bulk of
deals done within a dime of 19$/MWh. Into TVA trades were heard from 16.75
to 18.5$/MWh. In Washington, the fate of TVA's unfinished power plants was a
topic of the day, as members of Congress discussed whether TVA should be
allowed to lease the unfinished stations from its October $3.4 billion asset
reduction to private corporations for financing to complete them. High
temperatures were expected uniformly in the 60s across the Southeast through
Monday. The latest six-to-ten predicted below-normal temperatures from
December 19 to 23.
___________________________________________________________
California ISO Congestion Index in $/MWh

Path Peak Off-peak
for 14-Dec-01 NW1 to NP15 0.00 0.00
NW3 to SP15 0.00 0.00
AZ3 to SP15 0.00 0.00
LC1 to SP15 0.00 0.00
SP15 to NP15 0.00 0.00

OTC Forward Peak Electricity Contracts in $/MWh

Mid-C PV SP-15
Bid Ask Bid Ask Bid Ask
BOM 28.50 30.00 29.25 30.50 30.75 31.50
January 28.00 29.50 29.00 30.00 30.00 31.00
February 24.50 26.00 26.75 27.75 26.50 27.50
March 22.25 23.75 26.50 27.50 27.00 28.00
Q1 '02 25.00 26.50 28.25 29.25 29.00 30.00
Q2 '02 21.00 22.50 29.75 30.75 29.00 30.00
Q3 '02 36.00 37.50 47.50 48.50 44.00 45.00
Q4 '02 31.00 32.50 30.25 31.25 32.00 33.00
Cal '03 30.00 32.00 35.00 36.00 37.00 38.00

Represents the most recent bid/ask spread obtainable
by the Energy Market Report.

Alberta Power Pool Index (C$/MWh)

Peak(14) Peak(16) Off-Peak Flat Change
for 12-Dec-01 41.53 40.88 21.76 35.06 -2.17

BPA's Offer for 12/17/01.

Hours Amount NW delivered COB/NOB delivered

7-22 100MW Market Price* Market Price*

*Market price will be determined at time of request.

NYMEX Henry Hub Gas Futures in $/mmBtu

Close Change
Jan 2.756 0.037
Feb 2.822 0.029

Natural Gas Spot Prices in $/mmBtu

Low High
Sumas 2.59 2.64
So. Cal Border 2.67 2.72
San Juan 2.40 2.45
__________________________________________________________

Economic Insight, Inc. - 3004 SW First, Portland, Oregon 97201,
Telephone (503) 222-2425, Internet e-mail emr@econ.com -
Copyright, Economic Insight, Inc. 2001.