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Enron Mail |
FYI
Randy -----Original Message----- From: jdietert@simmonsco-intl.com [mailto:jdietert@simmonsco-intl.com] Sent: Wednesday, April 17, 2002 2:17 PM To: jdietert@simmonsco-intl.com Subject: Recent Power Price Spike An early heat wave in the Midwest, Mid Atlantic and the Northeast has caused electricity demand, power prices, spark spreads, and implied heat rates to spike over the last few days in those regions as follows: (Embedded image moved to file: pic31185.pcx) Based on these spark spreads and implied heat rates, we suspect that the increased electricity demand has likely caused a temporary increase in electricity-driven gas demand (difficult to quantify, but likely to show up in next week's gas storage numbers). Implied heat rates and spark spreads have been high enough to bring simple cycle peaking units as well as combined cycle units into the market. Furthermore, many lower marginal cost coal and nuclear units are currently offline for traditional maintenance, and the biggest beneficiary from a generation standpoint are gas-fired units. Temperatures in the Midwest are expected to drop today and Thursday along the East Coast, so the spike should be short-lived and gas-fired electricity production should come back down somewhat as a result (based on power prices so far today, it already appears that prices are beginning to come down). ***************************************************************************************************** This e-mail is based on information obtained from sources which Simmons & Company International believes to be reliable, but Simmons & Company International does not represent or warrant its accuracy. The opinions and estimates contained in this e-mail represent the views of Simmons & Company as of the date of the e-mail, and may be subject to change without prior notice. Simmons & Company International, its partners and/or employees may have positions in the securities discussed. Simmons & Company International may make a market in the securities discussed and may have served as a financial advisor and/or underwriter to companies discussed. Simmons & Company International will not be responsible for the consequence of reliance upon any opinion or statement contained in this e-mail. This e-mail is confidential, and may not be reproduced, in whole or in part, without the prior written permission of Simmons & Company International.
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