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Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Robert Brooks <rebrooks@earthlink.net< X-To: "'GPCM Distribution'" <rebrooks@rbac.com< X-cc: X-bcc: X-Folder: \Vincent_Kaminski_Jun2001_6\Notes Folders\All documents X-Origin: Kaminski-V X-FileName: vkamins.nsf From http://www.enerfax.com: Northwest Spot Power Prices Rise Spot power prices in the Pacific Northwest continued higher yesterday amid unit outages and strong natural gas prices. A projected weekend outage at the 1,087 MW Diablo Canyon Unit 2 nuclear power plant and a 10-day outage at the 820 MW IPP Unit 1 coal power plant should keep supplies scarce heading into next week. At COB, power for today rose over $15 to $270. Power sold at Mid-Columbia for today was up $15 at $267. Concern is mounting about the possibility of a dry year in the Pacific Northwest, which could keep prices high into the spring. In the Southwest, power prices declined amid lower day-ahead demand. According to the California PX, demand will peak at 32,435 MW today. Palo Verde slipped $36 to $137 per MWh, while Mead traded down $32 at $146 per MWh. Alliance Begins Commercial Operations Alliance pipeline is finally ready to begin commercial shipment of Canadian natural gas to Chicago from northern British Columbia today and operators are already talking about expanding the system. Originally scheduled to begin flowing in October, the delayed opening is set for the pipeline to begin transporting today. The addition of the $3 billion Alliance pipeline's capacity curbed price increases at Chicago yesterday relative to spikes in the Northeast. Cold weather headed for the East Coast triggered a 9% price jump in the region's prices yesterday. Prices at the New York City gate surged $0.75 per MMBtu to a record high of $7.20, while Chicago prices were only Up $0.35 at $6.41 per MMBtu. Canada supplies about 16% of US natural gas. Alliance is one of two new pipelines beginning operations this week. BC Gas C$375 million Southern Crossing Pipeline from eastern British Columbia to the West Coast began pumping 250 MMcf per day on Thursday in competition with Westcoast Energy. For its part, the Alliance system is seen by some as a key link in the eventual transport of Arctic natural gas to market. BP Amoco has assumed the transportation responsibilities of eight shippers on the pipeline whose volumes total more than 250 MMcf per day, and plans to increase that amount. Alliance partners include Westcoast Energy, 23.6%; Enbridge, 21.4%; Fort Chicago Energy Partners, 26%; Williams, 14.6%; and Coastal, 14.4%. We will be adding Southern Crossing to the next base case. Also, some corrections are needed in our Alliance model. Further research shows that the maximum receipt capacity from B.C. to be about 300 / day (9,120 / month) and from A.B. to be 1,950 / day (59,280). Alliance receives no supplies in the Northwest Territories and has no plans for doing so. The only existing connection to NWT is into Westcoast. I would change its capacity to 400 / day (12,160 / month), increasing to 500 / day (15,200) in 2002. Nova (TCPL Alberta System) is considering an extension into NWT in the future. The current base case shows a need for more than 500 / day starting in 2006. So, I've set up a supply link from NWT into Nova at 300 / day starting in 2006. Pollution Credits Shutting Down California Power Plants AES says output from three of its power plants in southern California has been cut in half due to a shortage of pollution credits. AES Pacific has curtailed 2,000 MW of a total capacity of 4,000 MW at its three natural-gas fired plants in the Los Angeles area, Alamitos, Huntington Beach and Redondo Beach. The move followed the filing of a petition by the South Coast Air Quality Management District related to its Alamitos plant which had exceeded its NOX emission allocation. Both Huntington Beach and Redondo Beach were close to reaching their NOX allocations. The plants could operate if the California ISO declared a power emergency. An arbitration board is due to rule in late December on the air quality district's petition. California has been struggling to meet surging demand for power this year. There have also been few power plants built during the last decade and the California ISO has had to issue numerous power alerts this year as operating reserves dropped to critical levels. The California ISO says a number of other plants are also running out of pollution credits. Coastal to Buy Pipe for Gulfstream Coastal has agreed to buy steel pipe for the Gulfstream natural gas pipeline from Berg Steel Pipe Corp for $310 million. Coastal's 774-mile pipeline will run from Mobile, AL across the Gulf of Mexico to Tampa. Duke and Williams, which had been developing a competing project, agreed earlier this month to buy Coastal's pipeline. Terms were not disclosed. Coastal's purchase was for the 36-inch diameter pipeline to run through the Gulf of Mexico and the 36-inch and 30- inch pipe for Florida. Pipe production will start immediately with delivery starting early next year in Port Manatee, Florida, and Mobile. All of the pipe is scheduled for delivery by September, and the pipeline is scheduled to start by June 2002. Coastal plans to complete the sale of the Gulfstream system this quarter. According to Williams' Buccaneer website, upon closure of the purchase of Gulfstream by Williams - Duke, Gulfstream will be built in lieu of Buccaneer. Our next base case database will reflect this change. Power Marketers Accused of Manipulating Prices Enron, PG&E Energy Trading, Duke Energy Trading and Marketing, Sempra Energy Trading and Dynegy Power Marketing are among a dozen energy companies accused in a lawsuit of conspiring to manipulate California wholesale electricity prices. The lawsuit claims companies selling electricity in California intentionally limited supply to drive up prices. The suit seeks certification as a class action covering all electricity consumers in California, estimates damages in excess of $1 billion. The allegations in the lawsuit are based on a number of studies of the state's electricity market that concluded it was not functioning normally. Southern California Edison and PG&E's Pacific Gas & Electric filed suit against state officials separately last month for permission to charge customers billions of dollars for losses from open-market power purchases. Bob Brooks GPCM Natural Gas Market Forecasting System http://gpcm.rbac.com
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