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---------------------- Forwarded by Vince J Kaminski/HOU/ECT on 12/19/2000=
=20 02:45 PM --------------------------- "The Alliance of Energy Suppliers" <alliance@eei.org<@ls.eei.org on=20 12/19/2000 02:08:58 PM Please respond to "The Alliance of Energy Suppliers" <alliance@eei.org< Sent by: bounce-app-ippexecs-33275@ls.eei.org To: "Generation and Power Marketing Executives" <app-ippexecs@ls.eei.org< cc: =20 Subject: Alliance Info Alert Dear Generation/Power Marketing Executive: This Alliance Info Alert includes three items of interest: 1) The weekly Alliance Express newsletter 2) Listing of recent filings at FERC 3) Timeline for FERC action on California Markets (attached) Alliance of Energy Suppliers Express=02=05December 1= 9, 2000 INSIDE WASHINGTON =02=05 FEDERAL AFFAIRS ***FERC De-Federalizes California Markets, Adopts Other Structural Reforms*= ** At a special meeting Friday afternoon, FERC unanimously approved its eagerl= y=20 awaited final order reforming the California wholesale markets, adopting th= e=20 major outlines of its November 1 proposed order and sending back to=20 California the responsibility for addressing state-related matters. At the= =20 same time, FERC deferred consideration of retroactive refund issues as well= =20 as the imposition of region-wide price caps. FERC reiterated their earlier= =20 conclusions that under certain circumstances, California ratepayers were=20 subjected to unjust and unreasonable power rates due to California's=20 "seriously flawed" market structure and rules in conjunction with tight=20 demand and supply conditions throughout the West. FERC adopted the November proposal to eliminate, effective immediately, the= =20 state's mandatory requirement that the state's investor-owned utilities buy= =20 and sell electricity through the PX, and allow these utilities to purchase= =20 electricity through forward contracts and other alternative mechanisms to= =20 manage supply risks. FERC terminated the PX's rate schedules effective at= =20 the close of business on April 30, 2001. In effect, as Chairman James=20 Hoecker stated, the order de-federalizes 60 percent of the California=20 wholesale market established under the state's restructuring law, returning= =20 ratemaking authority over company-owned generation to the California Public= =20 Utilities Commission (CPUC). The agency also modified the effective period of the $150/MWh "soft cap"=20 proposal, limiting its application through April 2001, whereupon a=20 "comprehensive and systematic monitoring and mitigation program which=20 incorporates appropriate thresholds, screen and mitigation measures" must b= e=20 in place. In a related move, FERC ordered a technical conference early nex= t=20 year to develop such a program by March 1, 2001, so that these measures can= =20 be place by the May 1, deadline. ***Energy Secretary Issues Order to Power Generators and Marketers To Bolst= er=20 California's Supplies*** Energy Secretary Bill Richardson has responded to the severely constrained= =20 power supply situation in California by issuing an order, pursuant to Secti= on=20 202© of the Federal Power Act, to require generators and marketers to mak= e=20 power available to meet the state's electricity needs. The emergency=20 directive requires that, if the California independent system operator (ISO= )=20 certifies that there is an inadequate supply of electricity, certain=20 suppliers would be required to make power available to the ISO if they have= =20 power available in excess of the amount needed to satisfy service to firm= =20 customers. Those suppliers that have provided power to the California power= =20 exchange (PX) and the ISO over the last 30 days that have firm capacity=20 available would be subject to the order. Under the order, the ISO is required to provide notice to each supplier=20 subject to the order of the amount and type of service requested by 9:00 pm= =20 EST on the day before the requested service. The ISO must, to the extent= =20 feasible, allocate the requests in proportion to the amount of each=20 supplier's available power. The price for the power provided pursuant to t= he=20 order will be set by an agreement between the ISO and the supplier. If no= =20 agreement is reached, FERC is to determine the just and reasonable rate at = a=20 later date. The order will remain in effect until 3:00 am EST on December= =20 21, 2000 unless modified. ***EPA Sets Plans to Regulate Plants' Mercury Emissions*** EPA Administrator Carol Browner, in a long-awaited announcement, indicated= =20 last week that the Administration will require reductions of mercury=20 emissions from coal- and oil-fired power plants. The agency stated that it= =20 plans to propose new regulations in December 2003, and hopes to finalize ne= w=20 rules by December 2004. In the wake of the decision, EEI called on EPA to make certain that any=20 program to control utilities' mercury emissions be based on the best=20 scientific information available in order to assure the protection of publi= c=20 health. "EEI urges EPA to maintain its commitment to resolving the key=20 scientific and technological issues," said Paul Bailey, EEI Vice President,= =20 Environmental Affairs. Given these uncertainties, EEI is disappointed that= =20 the regulatory determination includes statements regarding public health=20 threats and hazards that are unsupported by current science," said Mr. Bail= ey. "In the meantime, the electric power industry will continue to work with al= l=20 stakeholders to determine the extent to which additional mercury reductions= =20 from power plants may be needed, and how those cuts should be achieved," Mr= .=20 Bailey concluded. MERGERS & ACQUISITIONS ***Calpine Completes Acquisition of EMI Power Assets*** Calpine Corporation has announced that it has completed the acquisition of= =20 power assets from Energy Management, Inc. (EMI). In the deal, Calpine=20 acquired the remaining interest in three recently constructed, combined-cyc= le=20 power generating facilities located in New England, as well as a joint=20 marketing venture between Calpine and EMI. Prior to the transaction, Calpi= ne=20 held a 50 percent net interest in the projects. "We are very pleased to have completed the acquisition of these new and=20 highly efficient power plants. The Dighton, Tiverton, and Rumford faciliti= es=20 were among the first merchant power plants to enter commercial operation in= =20 New England," said Calpine Senior Vice President Bob Alff. "Combined with= =20 our other announced project in the Northeast, we have created a coordinated= =20 system of low-cost assets, with excellent geographic diversity, to provide= =20 power to a very attractive New England market," added Alff. ***Exelon Completes Acquisition of 49.9 Percent of Sithe*** Exelon Corporation and Sithe Energies have announced the completion of=20 Exelon's acquisition of 49.9 percent of the stock of Sithe. The completion= =20 of the acquisition finalizes an agreement in which PECO Energy Company agre= ed=20 to purchase 49.9 percent of Sithe's assets in North America for $682=20 million. PECO has since merged with Unicom Corporation to form Exelon=20 Corporation. Under the terms of the agreement, Exelon has the option to purchase the=20 remaining 50.1 percent of Sithe within two to five years at a price based o= n=20 prevailing market conditions when the purchase option is exercised. Exelon= =20 and Sithe will continue to operate independently, said the companies. ENERGY DATA *** Weekly Electric Output (Week 50)*** Electric output reached 74,737 GWh for the week ending December 9 (Week 50)= ,=20 with the highest increase over 1999 levels in the Mid-Atlantic region, whic= h=20 had a 15.8 percent increase over 1999. Looking at year-to-date information= ,=20 the Pacific Southeast leads the nation in growth of output. For more=20 information, email alliance@eei.org. WHO'S WHO ***Allegheny Energy Announces Leadership Change*** Allegheny Energy, Inc. this week announced the appointment of Michael=20 Morrell, Senior Vice President and CFO, as President of its unregulated=20 supply business, Allegheny Energy Supply Company, effective February 1,=20 2001. Morrell will replace Peter Skrgic, current President, who will be=20 retiring on that date after 37 years of service to the company. In his new position, Mr. Morrell will direct and continue the growth of=20 Allegheny's energy supply business, which operates and markets competitive= =20 retail and wholesale electric generation throughout the eastern US. =20 Additionally, Morrell will identify new opportunities to expand the Company= 's=20 generation holdings, announced a press release. The Alliance Express is a free news service sponsored by the Alliance of=20 Energy Suppliers. This document can be redistributed. Please send=20 questions, comments, or requests to alliance@eei.org, or telephone=20 202/508-5680. ***Due to the holidays, the Alliance Express will not be published next=20 Tuesday, December 26. =3D=3D RECENT FERC FILINGS =3D= =3D (1) RTO DEVELOPMENTS * The following entities filed comments regarding the California wholesale= =20 electric market. EL00-95-000, et. al. Filed December 13, 2000. - AMERICAN PUBLIC POWER ASSOC.: "Market Power: Will We Know It When We Se= e=20 It? The California Experience" - SOUTHERN CALIFORNIA EDISON CO.: "Proof that Soft Price Caps Do Not Resul= t=20 in Lawful Rates" and request for rehearing - SOUTHERN CALIFORNIA EDISON CO.: Request for immediate modification of th= e=20 December 8, 2000 Order - SAN DIEGO GAS & ELECTRIC: Motion to clarify the record * The following entities filed motions for an immediate modification and t= o=20 intervene regarding the Commission's emergency order December 8 approving t= he=20 CA ISO's tariff amendments. ER01-607-000, ER00-95-000 et. al. Filed=20 December 13, 2000. - WESTERN POWER TRADING FORUM - RELIANT ENERGY POWER GENERATION - PACIFIC GAS AND ELECTRIC - CA ISO - DYNEGY POWER MARKETING * SOUTHERN ENERGY COMPANIES filed a supplemental protest regarding PJM's= =20 Order 2000 Compliance Filing. RT01-2-000. Filed December 14, 2000. (2) OATT/TRANSMISSION * UGI UTILITIES filed an interconnection agreement with ALLEGHENY ENERGY= =20 SUPPLY CO. ER01-617-000. Comments due by December 28, 2000. * PUBLIC SERVICE COMPANY OF NEW MEXICO filed proposed revisions to its FER= C=20 Electric Tariff, a statement of Policy and Code of Conduct governing the=20 relationship between itself and wholesale power marketing affiliates and a= =20 notification of a change in status relating to its authorization to sell=20 power at market-based rates. ER01-615-000. Comments due by December 28,= =20 2000. * AMERICAN ELECTRIC POWER SERVICE CORP. (AEP) filed an executed=20 interconnection agreement between INDIANA MICHIGAN POWER CO. and DUKE ENERG= Y=20 BERRIEN. The agreement is pursuant to AEP COMPANIES' OATT. ER01-626-000. = =20 Comments due by December 29, 2000. * COMMONWEALTH EDISON CO. filed revisions to its OATT to reflect the=20 creation of a new generation subsidiary of EXCELON CORP., COMED's holding= =20 company. ER01-628-000. Comments due by December 29, 2000. * DETROIT EDISON COMPANY filed a Service Agreement for Network Integration= =20 Transmission Service under the Joint OATT between itself and CONSUMERS=20 ENERGY. The Service Agreement is between itself and NORDIC MARKETING. =20 ER01-622-000. Comments due by December 28, 2000. * DETROIT EDISON COMPANY filed service agreements for short-term firm and= =20 non-firm point-to-point transmission service under the joint OATT between= =20 itself and CONSUMERS ENERGY. The Service Agreement is between itself and H.= Q.=20 ENERGY SERVICES. ER01-621-000. Comments due by December 28, 2000. * LOUISIANA GENERATING filed a motion to intervene and protest regarding= =20 SOUTHWESTERN ELECTRIC POWER COMPANY's Restated and Amended Electric System= =20 Interconnection Agreement between SOUTHWESTERN and LOUISIANA GENERATING. = =20 ER01-504-000. Filed December 13, 2000. * ALLIANT ENERGY CORPORATE SERVICES filed a response to several protests= =20 regarding its proposed amended OATT. ER01-312-000. Filed December 14, 200= 0. * ELECTRICITIES OF NORTH CAROLINA, PIEDMONT MUNICIPAL POWER AGENCY and the= =20 CITIES OF ORANGEBURG and SENECA, SC filed a motion to intervene and protest= =20 regarding DUKE ENERGY, CAROLINA POWER & LIGHT and SOUTH CAROLINA ELECTRIC &= =20 GAS' proposed accounting and rate treatment of start-up costs associated wi= th=20 establishing a new RTO. EL01-13-000. Filed December 14, 2000. * SOUTHERN COMPANY SERVICES filed a proposed amendment to its OATT in orde= r=20 to incorporate creditworthiness criteria, interconnection procedures and=20 source and sink requirements. ER01-668-000. Filed December 14, 2000. * BONNEVILLE POWER ADMINISTRATION filed a petition for declaratory order= =20 stating that its proposed OATT satisfies the Commission's reciprocity=20 compliance principles. NJ01-1-000. Filed December 14, 2000. * AMERICAN TRANSMISSION CO. filed proposed Open Access Transmission rates= =20 and requested expedited consideration. ER01-677-000. Filed December 15,= =20 2000. (3) MARKET COMPLAINTS * H.Q. ENERGY SERVICES filed for an Order directing the NY ISO to restore= =20 the original market clearing prices for energy on May 8, 2000. EL01-19-000= . =20 Comments due January 2, 2001. * NEW ENGLAND POWER CO. filed an answer to the RHODE ISLAND ATTORNEY=20 GENERAL's protest regarding the application of the joint owners of the=20 undivided interest in the Millstone 3 nuclear plant to transfer ownership t= o=20 the DOMINION Applicants. EC00-137-000 and ER00-3639-000. Filed December 1= 3,=20 2000. (4) MERGERS/CORPORATE RESTRUCTURING (5) MISCELLANEOUS * CA ISO filed an amendment to schedule 1 of the Participating Generator= =20 Agreement between CA ISO and SIERRA PACIFIC INDUSTRIES. ER01-619-000. =20 Comments due by December 28, 2000. * AUTOMATED POWER EXCHANGE filed a new rate schedule under which it will= =20 provide its auction and scheduling service in its California market. =20 ER01-658-000. Filed December 14, 2000. * AUTOMATED POWER EXCHANGE filed a new rate schedule under which it will= =20 provide its auction and scheduling service in a new geographic market, know= n=20 as the APX Midwest Market. ER01-659-000. Filed December 14, 2000. Nancy Tarr Manager, Business Development ntarr@eei.org 202-508-5680 _________________________________________________________ - Timeline.doc
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