Market Update Report

"Energy Market Report" <emr@econ.com< on 10/19/2001 07:30:29 PM

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Subject: Energy Market Report - 10/19/01

Energy Market Report
Friday, October 19, 2001

*See attached pdf file.
__________________________________________________________
Western Pre-Scheduled Firm Electricity Prices($/MWh)
October 19, 2001 for October 21, 2001

Peak(Heavy)
Low Change** High Change**
NW/N. Rockies* 23.75 NA 24.50 NA
Mid-Columbia* 23.75 NA 24.50 NA
COB* 23.50 NA 24.50 NA
N. California* 22.50 NA 24.80 NA
Midway/Sylmar* NA NA NA NA
S. California* 22.25 NA 23.75 NA
Mead* 23.00 NA 25.00 NA
Palo Verde* 21.00 NA 25.00 NA
Inland SW* 21.00 NA 25.00 NA
4-Corners* 21.00 NA 24.00 NA
Central Rockies* 15.25 NA 19.50 NA
_________________________________________________________
Off-Peak(Light)
Low Change** High Change**
NW/N. Rockies* 23.75 NA 24.50 NA
Mid-Columbia* 23.75 NA 24.50 NA
COB* 23.50 NA 24.50 NA
N. California* 22.50 NA 24.80 NA
Midway/Sylmar* NA NA NA NA
S. California* 22.25 NA 23.75 NA
Mead* 23.00 NA 25.00 NA
Palo Verde* 21.00 NA 25.00 NA
Inland SW* 21.00 NA 25.00 NA
4-Corners* 21.00 NA 24.00 NA
Central Rockies* 15.25 NA 19.50 NA

*Denotes trading of flat, 24-hour products.
**"NA" changes are not applicable because prices for on and off peak goods
are not comparable to flat products.
__________________________________________________________
Western Pre-Scheduled Firm Electricity Prices($/MWh)
October 19, 2001 for October 22, 2001

Peak(Heavy)
Low Change** High Change**
NW/N. Rockies 26.00 NA 28.00 NA
Mid-Columbia 26.00 NA 28.00 NA
COB 26.00 NA 28.00 NA
N. California 25.50 NA 27.30 NA
Midway/Sylmar NA NA NA NA
S. California 26.00 NA 27.00 NA
Mead 26.50 NA 28.00 NA
Palo Verde 26.00 NA 28.00 NA
Inland SW 26.00 NA 28.00 NA
4-Corners 26.00 NA 27.00 NA
Central Rockies 23.50 NA 26.00 NA
_________________________________________________________
Off-Peak(Light)
Low Change** High Change**
NW/N. Rockies 23.75 NA 24.50 NA
Mid-Columbia 23.75 NA 24.50 NA
COB 23.50 NA 24.50 NA
N. California 22.50 NA 24.80 NA
Midway/Sylmar NA NA NA NA
S. California 22.25 NA 23.75 NA
Mead 23.00 NA 25.00 NA
Palo Verde 21.00 NA 25.00 NA
Inland SW 21.00 NA 25.00 NA
4-Corners 21.00 NA 24.00 NA
Central Rockies 15.25 NA 19.50 NA

**"NA" changes are not applicable because prices for on and off peak goods
are not comparable to flat products.
_________________________________________________________
Taking Stock in Gas

Western peak power prices rose Friday on the usual weekend premium and
hydroelectric curtailments in the Northwest. The annual Vernita Bar fish
operation commenced on Thursday, reducing the amount of generation during
the peak hours, and increasing output over the light load hours. "During
the heavy load hours we can roughly generate about half of what we can for
the light load hours," said one hydro operator. Some traders, however,
questioned the amount of impact the flow restrictions were having on the
dailies. "Reduced hydroelectric output isn't the real market-moving force,
gas is," said one analyst. While spot gas prices dipped slightly on Friday,
NYMEX Henry Hub futures contracts were sharply higher in moderate trade.
The gas contracts were propelled higher by some short covering ahead of the
weekend, a cooler six-to-ten-day forecast, and long-term outlooks released
earlier in the week calling for a "colder-than-usual" winter. November Hub
gas settled 19.5 cents higher at 2.681$/mmBtu, after reaching a session high
of 2.72$/mmBtu. December rose 19 cents to close at 2.99$/mmBtu. Total U.S.
storage stood at 3.042 tcf, or about 92% full. Some analysts believed that
gas inventories could climb to a record 3.15 tcf in the three remaining
weeks of stock-building season.

Day-ahead energy costs in the Northwest got a good boost Friday on the
typical risk associated with trading three days out, and on reduced
hydroelectric output during the peak hours. A few traders seemed a little
surprised that off-peak prices rose by an average of 2.25$/MWh given that
Vernita Bar operations allow for more generation during the light load
hours, but factor in all-day Sunday and there is no surprise. Peak power at
the Mid-Columbia ranged from 26 to 28$/MWh, with the bulk of transactions
occurring between 27 and 27.25$/MWh. The only unit of consequence remaining
off-line in the Northwest was Bridger #4 (520 MW), but the Wyoming-based
thermal unit was expected to return over the weekend. Weather forecasts
called for normal temperatures into the first part of the new week, with the
possibility of precipitation. NOAA announced their winter forecast for the
U.S. on Thursday, and said the Northwest can go either way as far as being
cold or warm. They also said to expect more rain than last year.

California electricity prices for Sunday and Monday strengthened in Friday
trade, with the light load prices up the most on the inclusion of the
all-day Sunday block. Peak prices at COB ranged from 26 to 28$/MWh,
climbing a buck, and off-peak goods traded between 23.5 and 24.5$/MWh,
firming up 1.5$/MWh on the low end and 50 cents on the high. NP15 and SP15
pieces traded almost flat to one other, with NP15 at a slight premium. In
financial news, California's DWR, the purchaser of power for most Golden
State residents, revised its projected costs for buying electricity next
year down to $17.2 billion. The 20% reduction was based mainly on the
continued decline of spot electricity and natural gas prices. Originally,
the DWR had expected to pay $21.45 billion for the procurement of power.
Daytime temperatures for Monday and Tuesday were expected to be near normal,
in the 65 to 75 degree range, while the latest six-to-ten called for
above-normal temperatures from October 25 to 29. On the unit front,
gas-fired Scattergood #3 (445 MW) was down for unplanned maintenance without
an ETR. On an up note, Sunrise Power Plant (338 MW) was nearing full power
Friday morning.

Despite a continued blanketing of above-normal temperatures, Monday's peak
power prices in the Southwest were up only slightly from levels reported for
the Friday/Saturday package. The price tag on light load energy rose more
substantially, gaining as much as 2.75$/MWh at Palo Verde. Heavy load
energy at the Southwest hub traded in a range of 26 to 28$/MWh, a rise of
only 50 cents on the low end. There was little in the way of unit news on
Friday. Arizona-based Coronado #2 (385 MW) was expected to be back in
service sometime on Monday, following valve repairs. Weather forecasts
called for slight cooling early in the new week, but temperatures were
expected to remain at above-normal levels. Furthermore, the latest
six-to-ten from the NWS was predicting above-normal temperatures for the
entire desert region from October 25 through 29.

Patrick O'Neill and Jessie Norris
_________________________________________________________

Western Generating Unit Outages

Current Begins Ends Reason
CAISO units <250/5687 total NA NA
planned/unplanned*
Bridger #4/520/coal 17-Oct-01 20-Oct-01 repairs
Comanche #2/335/coal 29-Sep-01 30-Oct-01 maintenance
Contra Costa #7/337/gas 01-Sep-01 ? planned
Coronado #2/385/coal 18-Oct-01 22-Oct-01 maintenance
Crockett Cogen/260/gas 15-Oct-01 ? planned
El Segundo #3/337/gas 02-Oct-01 ? unplanned
Etiwanda #3/320/gas 05-Oct-01 ? unplanned
Etiwanda #4/320/gas 05-Oct-01 ? unplanned
Helms PGP #2/407/hydro 01-Oct-01 ? planned
Hyatt/Thermalito/900/hydro 02-Oct-01 ? @ 250MW,
planned
Los Medanos/550/gas 19-Oct-O1 ? planned
Ormond Beach #2/750/gas 05-Oct-01 ? @ 350MW,
unplanned
Palo Verde #2/1270/nuke 10-Oct-01 30 days maintenance
Palo Verde #3/1270/nuke 29-Sep-01 03-Nov-01
refuel/maint.
Rawhide/255/coal 18-Oct-01 20-Oct-01 tube leak
San Onofre #2/1070/nuke 14-Oct-01 02-Nov-01 maintenance
Scattergood #3/445/gas 18-Oct-01 ? unplanned*

Future
San Juan #4/534/coal 20-Oct-01 11-Nov-01 maintenance

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

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

October 19, 2001 for October 22, 2001

Peak (Heavy) in $/MWh
Low Change High Change
Into Cinergy 19.50 -2.25 22.00 -2.00
Western PJM 24.90 -0.35 26.25 0.75
Into Entergy 20.00 0.00 21.50 0.50
Into TVA 21.00 -1.00 22.00 -1.00
___________________________________________________________
Amid expectations of warmer weather for Monday and little news of
curtailments, peak power prices for Monday delivery posted mixed results
across the Eastern Interconnect in Friday trade. Daytime temperatures
reached the mid-60s in the Midwest and along the northern seaboard, with 70
to 75 degree ranges seen in the south. Monday temperatures were expected to
be warmer, but the hot flash should be short-lived as below normal
temperatures were forecast for October 25 to 29. NYMEX Henry Hub gas
contracts rose substantially in end-of-the-week trade. November climbed
19.5 cents to close at 2.681$/mmBtu, while December gained 19 cents to end
at 2.990$/mmBtu.

Heavy load energy costs for Monday delivery were seen trading in a slightly
wider range on Friday, gaining ground on the high end. Western PJM goods
changed hands between 24.9 and 26.25$/MWh, with the bulk of deals done
around 25.5$/MWh. November forward contracts climbed as well, with
unconfirmed trades as high as 27.95$/MWh. New England nuke Seabrook #1
(1161 MW), down since Monday, was expected to return to service over the
weekend, and with Nine Mile Point 2 (1142 MW) back as well, sellers
anticipated less demand from NEPOOL in the new week. LMPs were averaging
22.18$/MWh through 16:00 EDT, after a brief mid-morning spike to 61$/MWh.
Actual loads were drifting below forecasted loads for most of the afternoon.
Temperatures through Tuesday were expected to be above normal in the 50s and
60s, while the latest six-to-ten from the NWS called for below-normal
temperatures from October 25 to 29.

In the Midwest, peak power prices fell in Friday trade, with predictions of
warmer weather for Monday. Into Cinergy goods were bought and sold between
19.5 and 22$/MWh, with most trades in the 21 to 21.8$/MWh range. November
forward contracts also rose, with reported prices as high as 23.3$/MWh.
Daytime temperatures for the early part of the new week were expected in the
60s and 70s, with mild overnights. The most current six-to-ten called for
below-normal temperatures from October 25 to 29.

In the Southeast, peak power prices stayed mostly steady on Friday. Into
Entergy pieces were exchanged between 20 and 21.5$/MWh. Electricity prices
into TVA ranged from 21 to 22$/MWh. In unit news, nuke Surry #1 (781 MW)
entered its fall refueling outage, while fellow nuke Hatch #2 (813 MW) was
expected to exit its refueling outage over the weekend. Weather across the
region was expected to be warmer Monday and Tuesday, with daytime
temperatures in the 75 to 83 degree range. However, the latest six-to-ten
predicted normal to below-normal temperatures from October 25 to 29.
___________________________________________________________
California ISO Congestion Index in $/MWh

Path Peak Off-peak
for 20-Oct-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 25.75 26.25 27.25 27.75 27.50 28.00
November 28.00 28.50 27.25 27.75 28.50 29.00
December 36.00 36.50 31.50 32.25 33.50 34.50
Q1 '02 33.25 34.00 31.75 32.00 33.25 33.75
Q2 '02 27.50 28.50 35.00 36.00 34.00 34.50
Q3 '02 44.00 45.00 52.00 52.75 48.25 49.00
Q4 '02 36.75 37.50 36.00 36.50 37.00 37.25
Cal '03 38.00 39.00 40.50 41.50 43.00 43.50

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 18-Oct-01 108.87 102.54 34.67 82.16 27.33

BPA's Offer in $/MWh

Hours Amount NW COB NOB

BPA has no offer until further notice.

NYMEX Henry Hub Gas Futures in $/mmBtu

Close Change
Nov 2.681 0.195
Dec 2.990 0.190

Natural Gas Spot Prices in $/mmBtu

Low High
Sumas 2.03 2.08
So. Cal Border 2.14 2.19
San Juan 1.90 1.95
__________________________________________________________

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

- WPU.xls
- emr101901.PDF
- EMR Prices.xls