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Enron and Exelon Unit Set Chicago Power Deal
The Wall Street Journal, 06/07/01 World Watch The Wall Street Journal, 06/07/01 Enron Broadband invests in AP Engines Houston Chronicle, 06/07/01 Attempt to save Enron power project in India extended to third day Houston Chronicle, 06/07/01 Derwent Valley. : Grosvenor Place Pre-letting Dow Jones International News, 06/07/01 India Dabhol Pwr Lenders Mtg Ends "Positively" - Source Dow Jones Asian Equities Report, 06/07/01 INDIA: Private firms expect Enron India's woes to end. Reuters English News Service, 06/07/01 India IDBI Exec Leaves Dabhol Mtg Early; Reason Unknown Dow Jones International News, 06/07/01 INDIAN PM CONFIDENT OF RESOLVING ENRON DISAGREEMENT SOON Asia Pulse, 06/07/01 Walking the talk? The Daily Deal, 06/07/01 GM, Other U.S. Companies Blast Bush Move to Shield Steelmakers Bloomberg, 06/07/01 Pacific Hydro Bends With the Wind, Flows With Water (Update5) Bloomberg, 06/07/01 Council status quo for blacks Hispanic growth likely to affect white wards Chicago Tribune, 06/07/01 Enron Plans to Challenge Power Regulator's Order, Paper Says Bloomberg, 06/07/01 Since when does rape equal justice? Chicago Tribune, 06/07/01 PPA in force, claims DPC Business Standard, 06/07/01 Calif Eyes Ending Access To Alternative Power Suppliers Dow Jones Energy Service, 06/06/01 Enron and Exelon Unit Set Chicago Power Deal Dow Jones Newswires 06/07/2001 The Wall Street Journal A4 (Copyright © 2001, Dow Jones & Company, Inc.) CHICAGO -- Enron Corp. and Exelon Corp.'s Commonwealth Edison Co. signed an agreement to supply power to the city of Chicago and 47 suburban communities, in the largest such deal since Illinois deregulated its electricity industry in 1997. Under the agreement, Enron will provide 60% of the 400 megawatts of power contracted annually while ComEd will provide the rest. Terms of the contract, expected to go into effect this year, weren't disclosed. The coalition of governments sent out requests for bids to the state's 13 registered electricity providers last summer in a bid to bring down power costs. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. International World Watch Compiled by David I. Oyama 06/07/2001 The Wall Street Journal A17 (Copyright © 2001, Dow Jones & Company, Inc.) ASIA/PACIFIC Lenders to Enron Unit Continue Talks Foreign and Indian lenders are scheduled to meet again today in Singapore, after two days of talks with Dabhol Power, U.S. energy company Enron's Indian unit, ended in deadlock, according to R.M. Ganatara, general manager of the Industrial Development Bank of India. The talks are over the future direction of its $2.9 billion power project near Bombay. "Something is being hammered out; there isn't a common meeting point yet. We will be looking toward a solution to end this crisis" at today's meeting, he said. But he said he wasn't "sure how and where the talks will end" concerning the project, which has been torn by a bitter dispute between Dabhol and the Maharashtra State Electricity Board over nonpayment of bills and power charges. June 7, 2001, 12:09AM Briefs: Houston & state Enron Broadband invests in AP Engines Enron Broadband Services, a division of Houston-based Enron Corp., took part in a $30 million venture investment into Massachusetts-based tech firm AP Engines. Private equity fund Thomas Weisel Capital Partners led the round, while Atlas Venture, Bessemer Venture Partners and Commonwealth Capital Ventures, Lighthouse Capital Partners and Mentmore Venture Partners also participated in the round. AP Engines develops software that allows broadband Internet service providers, such as cable and telephone companies, to move a variety of data types, including, e-mail, voice, video-on-demand and video conferencing over their networks. June 7, 2001, 9:58PM Houston Chronicle Attempt to save Enron power project in India extended to third day Bloomberg Business News SINGAPORE -- Indian banks that funded Dabhol Power Co., a unit of Enron Corp., and international lenders extended a meeting into a third day to try to save the $3 billion power project from closure, bankers said Wednesday. Executives from Industrial Development Bank of India, or IDBI, other Indian banks and international lenders such as ABN Amro Holding NV decided to meet again today after initially planning a two-day meeting, the bankers said. The meeting was called to resolve a dispute related to power prices that has resulted in Dabhol and the Maharashtra State Electricity Board, its only customer, starting to terminate the project. The fate of Houston-based Enron's first investment in India is seen as a litmus test for future foreign involvement in infrastructure projects in the country. Indian banks have the most at stake. Unlike them, international lenders received government guarantees for about $600 million they lent to the project. The Indian banks, which have given as much as $1.4 billion in unsecured loans, are that concerned foreign creditors may call for a termination of the project and invoke their guarantees and are seeking ways to keep it alive. Lenders such as ABN Amro, Citibank N.A., a unit of Citigroup, Bank of America and Credit Suisse First Boston in April approved Dabhol's decision to begin termination of its power supply contract with the board. Foreign banks wouldn't comment on what solution they are seeking from the Indian lenders at the Singapore meeting. Derwent Valley. : Grosvenor Place Pre-letting 06/07/2001 Dow Jones International News (Copyright © 2001, Dow Jones & Company, Inc.) LONDON -(Dow Jones)- The company has, through one of its subsidiaries, pre-let further office space at 21 Grosvenor Place, SW1 to Enron Power Operations. Enron took 1,980 sq. m (21,300 sq. ft) earlier this year and is now taking an additional 1,170 sq. m (12,600 sq. ft), at GBP0.7m per annum. The rent payable equates to GBP55 per sq. ft, for a lease expiring in 2014, with reviews in 2004 and 2009. Refurbishment of this newly-let space will be incorporated into the current scheme, at an additional cost of GBP1m, with the work scheduled for completion at the end of 2001. ICV Edited News from Dow Jones Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. India Dabhol Pwr Lenders Mtg Ends "Positively" - Source 06/07/2001 Dow Jones Asian Equities Report (Copyright © 2001, Dow Jones & Company, Inc.) SINGAPORE (Dow Jones) A three-day meeting involving institutional domestic and foreign lenders to U.S. Enron Corp.'s (ENE) troubled Dabhol Power Co. project in India ended Thursday "positively," one of the lenders told Dow Jones Newswires. He added no further meetings were planned in Singapore. Dabhol, India's largest private power plant, was scheduled for commissioning in two phases. The project's first phase, a 740-megawatt power plant, has already been commissioned and 1,444-megawatt phase two is due to be completed later this year. The $3 billion Dabhol project has been mired in financial disputes when its main customer, the Maharashtra State Electricity Board, has failed to pay several of its bills. Dabhol has come under fire because of the relatively high cost of its power. Critics object to Dabhol charging INR7.1 a kilowatt-hour for its power, compared with INR1.5/KWh charged by other suppliers. Enron Corp. (ENE) has a 65% controlling stake in the controversial 2,184-megawatt, $3 billion Dabhol project, which supplies power to the State Electricity Board. MSEB has 15%, General Electric Co. (GE) has 10% and Bechtel (X.BTL) with 10% are the other shareholders in the project. A senior official with an Indian lender involved in the DPC project confirmed that the meeting's outcome was positive. "There were some positive developments. That's all I can say," the official told Dow Jones Newswires by telephone. IDBI Executive Director R.S. Agarwal denied media reports that lenders had proposed mothballing the second phase of the power project at the lenders meeting in Singapore. "We aren't considering any such thing. Reports that say so are wrong. That was a proposal from Dabhol Power to mothball the DPC's Phase Two for a year," Agarwal said, speaking from Bombay. The DPC had proposed suspending construction of Phase Two of the power project for "about a year or so until basic issues are sorted out," he said. "It was felt in the meeting that the (Phase Two) of project should be mechanically completed in all respects, and then the project's position should be reviewed thereafter," he said. "We have forwarded the DPC's proposal to the lenders' engineer Stone & Webster (U.SEW) to study its commercial implications and have asked them to report back," Aggarwal said. He said Stone & Webster's assessment should be completed in around one week's time. DPC refused to comment on the result of the lenders' meeting. A Bombay-based DPC spokesman said he couldn't pass comment on "the internal talks of a meeting." The second phase of the project, a 1,444 megawatt power plant, is more than 90% complete. Speaking earlier Thursday, Wade Cline, DPC's managing director, said an informal deadline of mid-June had been set to decide whether to continue with Phase Two construction. However, Cline said the deadline was "not a definitive D-Day." "One of the key decisions they (the lenders) are focusing on is continuing with (Phase Two) construction at the site," he said. Wade said that an unspecified sum of money had yet to be paid to Phase Two's contractors led by Bechtel (X.BTL). "It's a significant amount of money," Cline said, without elaborating further. "(Phase Two) of the Project hasn't had any loan disbursements in the last three months," he added. One informed source familiar with the lenders' discussions said Phase Two completion "would require US$500 million," adding the amount owed to contractors is in the region of US$30 million-US$40 million. Lenders are attempting to steer the government towards considering additional buyers for the power produced by DPC. "We are now at a time when there isn't a lot of certainty as to who is going to buy the power. We are all working to find solutions to that problem," Cline said. -By Sri Jegarajah, Dow Jones Newswires; 65-415-4066; sri.jegarajah@dowjones.com (Himendra Kumar in New Deli and Daniel Pearl of the Asian Wall Street Journal contributed to this report.) Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. INDIA: Private firms expect Enron India's woes to end. 06/07/2001 Reuters English News Service (C) Reuters Limited 2001. NEW DELHI, June 7 (Reuters) - India's private power producers expect an early end to the dispute between Enron Corp and a local utility after Prime Minster Atal Behari Vajpayee said he was optimistic about the U.S. firm's $2.9-billion project. "Now the central government is taking interest. That too at the highest level. That is very nice," Harry Dhaul, director-general of the Independent Power Producers' Association of India, told Reuters. On Wednesday Vajpayee said he was confident that Dabhol Power Co, 65-percent owned by Enron, and the Maharashtra State Electricity Board (MSEB), the plant's only buyer, would sort out their problems. MSEB, which complains that Dabhol produces costly power, defaulted on payments of $48 million to DPC last year. The squabble provoked Enron to serve a preliminary termination notice to MSEB and the utility declared late in May that it had stopped buying power from the controversial plant. Dabhol's first phase of 740 MW is already operational and the next phase was scheduled to add 1,444 MW later this year. MSEB has already said it would not buy power from the project's next phase. Private power producers, who have been demanding federal intervention in the dispute said Vajpayee's comments augured well for the plant and will help refurbish India's image that took a beating after the dispute involving its largest direct foreign investor. "I think the prime minister has done absolutely the right thing. It is going to send the right signal that we are back on track and the international investors concern will be duly met." Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. India IDBI Exec Leaves Dabhol Mtg Early; Reason Unknown 06/07/2001 Dow Jones International News (Copyright © 2001, Dow Jones & Company, Inc.) NEW DELHI -(Dow Jones)- Industrial Development Bank of India Executive Director R.S. Agarwal returned to India from Singapore late Wednesday after two days of talks between domestic and foreign lenders on the future of Enron Corp.'s (ENE) troubled Dabhol Power Co. Agarwal has returned to India before the meeting has concluded. The meeting - originally scheduled for two days - has been extended into a third day as both parties have failed to reach any common ground on how to resolve a prolonged dispute between the DPC and its sole buyer of power the Maharashtra State Electricity Board. Agarwal didn't give a reason as to why he had returned from the meeting early. Late Wednesday, R.M. Ganatra, IDBI general manager said talks had ended in a deadlock. "Something is being hammered out, there isn't a common meeting point yet." Speaking from the company's Bombay headquarters, Agarwal said "some (IDBI) representatives are there still (in the Singapore lenders' meeting)." He didn't elaborate further. DPC officials are also attending the meeting. Domestic lenders which include IDBI, State Bank of India (P.SBI) and ICICI Ltd. (IC) have lent US$1.4 billion to the US$2.9 billion Dabhol Power project. Last month, Dabhol Power issued a preliminary notice to terminate its agreement to sell power to India's Maharashtra state government and to provide power from its online 740-megawatt Dabhol Power plant. Dabhol Power issued the notice to terminate after the state failed to pay December and January power bills amounting to US$48 million on time. The state and Dabhol Power are currently in talks in an effort to see if they can renegotiate the deal including a power purchase agreement the state says is now too expensive. Also, a second phase of the project, a 1,444-megawatt power plant more than 90% complete, also is in doubt. -By Himendra Kumar, Dow Jones Newswires; 91-11-461-9427; himendra.kumar@dowjones.com Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. INDIAN PM CONFIDENT OF RESOLVING ENRON DISAGREEMENT SOON 06/07/2001 Asia Pulse © Copyright 2001 Asia Pulse PTE Ltd. MUMBAI, June 7 Asia Pulse - The Indian Prime Minister, Atal Bihari Vajpayee, today expressed confidence that the 7-month old imbroglio over purchase of power from Enron promoted-Dabhol Power Company (DPC) would be resolved soon. Vajpayee, who arrived here for a knee surgery, told reporters that there were difficulties in finding a solution, but expressed confidence that the issue would be sorted out. "Right steps are being taken to sort out the matter," he said, adding the Maharashtra government and the U S energy major Enron were in a position to resolve the imbroglio. Centre has already directed the Central Electricity Authority (CEA) to scout for buyers of DPC power, mainly in the power-deficient states. Asked whether the federal government would be buying surplus power from Enron -promoted Dabhol Power Company, Vajpayee commented "Who will purchase such a costly power?" (PTI) 07-06 0950 Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Industry Insight Walking the talk? by Lachlan Colquhoun 06/07/2001 The Daily Deal Copyright © 2001 The Deal LLC India's finance minister says the country is open for business, but delayed deals and investor wariness tell a different story. Indian Finance Minister Yashwant Sinha promised earlier this year he would "walk the talk" on liberalizing the country's famously protectionist foreign direct investment regime. Five months on, he's clearly proud of his accomplishments. Too proud. "The reform measures the government has put in place have paid significant attention to foreign direct investment," Sinha said in an interview. "An investor-friendly policy regime has been put in place with foreign investment being permitted in almost all sectors under the automatic route." Sinha initially won applause from foreign investors for introducing a program that included key privatization initiatives and select sector foreign direct investment liberalization. But the minister has stumbled recently on four key deals. The main privatization targets for this year -- state flag carrier Air-India Ltd., car maker Maruti Udyog Ltd. and local telecom giant Videsh Sanchar Nigam Ltd. -- all remain unsold. And Enron Corp.'s long-troubled effort to make a profit from its $3 billion investment in a 65%-owned power plant in the state of Maharashtra -- the largest foreign investment in India -- has hit a brick wall. The Houston power company moved in May to abandon its decade-long effort after repeated run-ins with the state government over unpaid bills. For corporate dealmakers, India continues to tempt and disappoint. With a population of 1 billion and an emerging middle class, the prospect of a reforming, open Indian economy fascinates foreign companies in the way China did in the 1990s. The only problem is the government's inability to implement its rhetoric on reform. Sinha described the reform process as "irreversible." However, he said the country was following a "calibrated" approach to "allow the economy enough time to absorb the impact of restructuring." But calibrated to what? No foreign groups, for example, were among the bidders expressing interest in the 25% stake in Videsh Sanchar Nigam the national government is selling. India's tangled telecom regulations made a bid far too problematic. New Delhi's effort to sell 40% of Air-India is also freighted with red tape. First off, the government is offering only 26% to a foreign carrier. This led Delta Air Lines Inc. of the U.S. and Air France, which were planning a joint bid, to drop out of the race. That cleared the path for a bid by Singapore Airlines Inc. in partnership with the local Tata group, the original owners of the nationalized air carrier. But what is a minority stake in perpetually money-losing Air-India worth? SIA and Tata could well balk if New Delhi asks too much. Then there is the government's 50% stake in Maruti Udyog. Joint venture partner Suzuki Motor Corp. has the first right of refusal on the government's choice of buyer. The Japanese carmaker prefers that General Motors Corp., which holds a 20% stake in the local carmaker, buy out the government. But the government has said no. With New Delhi and Suzuki barely on speaking terms, the sale could be a long way off. This would make the issue "forever and after the epitome of lost privatization opportunities," says Udayan Bose, chairman and CEO of Lazard India. Sinha's response? "The government appointed a committee on March 26 to negotiate with Suzuki. The committee has commenced formal negotiations with Suzuki." To be fair, Sinha has one piece of reform of which to be proud. Passage of legislation liberalizing the insurance sector last year was his major triumph and a landmark for global insurance giants. Standard Life Assurance Co. and Prudential Corp. plc of Britain, as well as Metropolitan Life Insurance Co. and American International Group Inc. of the U.S., are among the foreign players already hooked up with Indian partners. Sinha says the reforms will triple the size of the local insurance market within three years. Sinha predicts other victories soon. "We have already taken the decision to privatize 27 public sector companies," he said. "In most of these cases, the process is on. We have streamlined procedures, and it is our duty to convince the people of this country and Parliament that the process is transparent." Still, the privatizations of Air-India, Maruti Udyog and VSNL mean the government's $2.3 billion sales target for this year is clearly in trouble. And recent overall FDI figures are not encouraging, either. According to the Reserve Bank of India, approval was granted for FDI of $55.1 billion between 1991 and 1998, but only $12 billion was actually invested. India's infamous bureaucracy turned many potential investors away. But also of concern is the economy. GDP growth, which many regard as inflated by statistical quirks anyway, has declined from 6.6% in the fiscal year ending March 2000 to an estimated 6% in fiscal 2001. Industrial growth fell from 8.2% to 6%. Pressed about a lackluster macroeconomic picture Sinha pointed instead to the nation's undoubted strengths. "India offers a vast reservoir of well-skilled technical manpower, an abundance of natural resources and a well-developed communication network," he boasted. "The country has liberalized in practically all sectors and has developed a substantial degree of openness." More's the pity, then, that the country has a demonstrated ability to shoot itself in the foot whenever economic reform looks promising. Lachlan Colquhoun is a Daily Deal correspondent based in Syndey. http://www.thedeal.com Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. GM, Other U.S. Companies Blast Bush Move to Shield Steelmakers 2001-06-07 00:01 (New York) Washington, June 7 (Bloomberg) -- General Motors Corp. is concerned that an investigation President George W. Bush ordered of foreign steel in the U.S. may lead to import curbs, pushing up prices for the cars and trucks it sells consumers. Stripmatic Products Inc., a Cleveland company with 30 employees that supplies brake components to GM and other automakers, has a deeper worry: If it's forced to buy more expensive U.S. steel, it may lose all its customers. ``If they put on import tariffs, I will lose my business to overseas manufacturers,'' said Stripmatic President Bill Adler, whose 55-year-old company imports low-grade stainless steel exclusively from a French manufacturer. GM, the world's largest automaker, and Stripmatic were among the U.S. steel-consuming companies that blasted Bush's Tuesday order, warning it may cost money and jobs in the $37 billion U.S. steel industry. ``Imported steel has the effect of keeping a dampener on prices,'' said Bill Noak, a General Motors spokesman. Bush told the International Trade Commission, a U.S. agency, to look into whether steel imports were harming domestic producers, a step that may clear the way for remedies such as tariffs, import curbs or an outright ban on the foreign products. The president responded to pressure from U.S. steelmakers such as LTV Corp., Bethlehem Steel Corp. and Weirton Steel Corp., which have been lobbying for import protection since 1998, when a flood of foreign metal sent steel prices and profits plunging. Since 1998, 18 U.S. steel companies, including LTV, the country's second largest, filed for bankruptcy. Pushing for Protection The U.S. industry has lost 80 percent of its jobs in the last two decades, and steelmakers and steelworkers mostly blame imports, which now take up about 27 percent of the U.S. market, the world's largest. They charge that unfair trade practices, including government subsidies that allow companies from South Korea to Brazil to sell steel in the U.S. below the cost of production, have made it impossible to compete on price. A metric ton of structural steel used in high-rise buildings cost about $615 in the U.S. at the end of last year -- and $275 in Russia, according to the International Cost Engineering Council, a nonprofit group. Bush backed that contention when he said the U.S. industry has been ``affected by a 50-year legacy of foreign government intervention in the market.'' ``All we've ever asked for is a fair and level playing field,'' said Daniel Dimicco, president of Charlotte-based Nucor Corp., a ``mini-mill'' that makes steel by melting scrap and was the most profitable domestic steelmaker last year. ``That is the message the president is sending, and we support it.'' 8 Million Workers Officials from companies that consume steel in the U.S. contend that such protection would cost the U.S. far more than the steel industry would gain. About 8 million Americans are employed by steel-consuming industries -- including auto and appliance makers, construction companies and energy companies, according to the Consuming Industries Trade Action Coalition, a group of steel consumers including Caterpillar Inc., Procter & Gamble Co. and Enron Corp. Steel producers employ about 160,000 people, down from 800,000 20 years ago. An April study by the coalition examined the effect of steel import quotas and tariffs and found that manufacturers using steel would be forced to cut jobs because of higher costs. That would result in an overall loss of between 19,000 and 32,000 jobs, while protecting only about 3,700 steelworker jobs. Michael Fanning, a spokesman for Michelin North America, the number two U.S. tire maker that also manufactures the B.F. Goodrich and Uniroyal brands, said any move by the U.S. to add tariffs or restrict imports ``will hurt the downstream users.'' No Domestic Suppliers ``We import a lot of high-quality steel from outside the United States from companies in Germany, France, Japan, simply because we can't get it in this country,'' Fanning said. ``We find it disheartening that we would be penalized simply because we can't get any domestic supplier.'' The American Institute for International Steel, an association of U.S. and foreign companies that support free trade, said American steel companies themselves would be damaged by import restrictions because they are among the largest importers of foreign products. Domestic steelmakers imported almost a third of the 37.8 million tons of foreign steel brought into the U.S. last year, the institute said. Most was in the form of ``slab'' -- raw steel -- or semi-finished products that were finished by U.S. companies. Bill Jens, owner of Ataco Steel Products Corp. of Cedarburg, Wisconsin, whose 100-employee company annually sells $13 million in lawn and garden implements, among other products, said Bush's move is aimed at ``protecting companies that are really something of a dinosaur.'' ``They haven't been keeping up technologically with what's been going on in the world, and all of a sudden we're going to be forced to buy their steel at a higher price because they can't keep up?'' he said. ``I don't think that's right.'' Pacific Hydro Bends With the Wind, Flows With Water (Update5) 2001-06-07 02:18 (New York) Pacific Hydro Bends With the Wind, Flows With Water (Update5) (Closes stock price.) Melbourne, June 7 (Bloomberg) -- Pacific Hydro Ltd., the best- performing stock in Australia's key index in the year to date, hopes the westerly gales that buffet the southern coast will lift its shares even higher. The Melbourne-based company plans to turn squalls into electricity by building 114 windmills on the Victoria coastline. It says the nation's biggest wind farm would provide enough power for 200,000 households. After tumbling this week, Pacific Hydro shares rose 8.8 percent today, its biggest daily gain in almost six months. That brings its increase in the past six months to 96 percent, outpacing rivals on the S&P ASX 200 Index, and some investors say it could keep rising. ``In a climate of higher energy prices, we like renewable energy and this company is doing it very well,'' said Ian Huntley, who holds Pacific Hydro shares among the A$44 million ($23 million) he manages at Huntley Investment Co. ``Looking at its growth in revenue and earnings, it does very well whatever business it's in.'' Granted, Pacific Hydro isn't cheap. Even after this week's 15 percent slump, it trades at 72 times earnings -- almost twice the average ratio on an index of local utility stocks. Earnings from power stations in the Philippines, Australia and New Zealand may not justify that high a valuation. ``They're probably the foremost experts in wind energy in Australia -- management is very good,'' said Andrew King, whose A$350 million of stocks at Investors Mutual Ltd. don't include Pacific Hydro. Still, ``it's just a bit too high on valuation at the moment,'' he said. California Yet comparable companies elsewhere are even more expensive on a price-earnings basis. Denmark's Vestas Wind Systems A/S, for example, trades at almost 80 times earnings. Its shares more than tripled last year. Managing Director Jeff Harding's ambition could see his company build as many as 1,000 windmills, rivaling the largest windmill owners like U.S.-based FPL Group Inc., Enron Corp., and Iberdrola SA, Spain's second-largest utility. Besides its expansion plans, the company can also take advantage of a new Australian law that raises the amount of electricity the nation gets from renewable resources to 12 percent from 10 percent. A wind farm takes only nine months to build compared with a hydroelectric power station, which can take as long as seven years. Commodity prices have cooperated in pushing up prices of so- called green stocks like Pacific Hydro. The price of natural gas more than quadrupled in the past year. Oil doubled since 1999. The price of coal, used to produce 80 percent of Australia's electricity, rose more than 50 percent in 12 months. In California, meantime, power shortages have crippled the wealthiest U.S. state, boosting demand for alternative energy sources like wind and water. ``People have seen what's happened to the energy sector in the States,'' said Stuart Smith, an analyst at Merrill Lynch & Co. ``Even though (Pacific Hydro stock) has pulled back a lot, it's still been a performer.'' Nepal Australians are hungry for energy. They are the fifth-biggest consumers of electricity, lagging Norway and the U.S. Pacific Hydro's earnings may triple this year to A$18.5 million, helped by the start of its Bakun hydroelectric station on the northwest Philippines island of Luzon, which almost doubled the company's electricity generation. It plans to build another hydro station on the southern Mindanao Island with joint venture partner Aboitiz Equity Ventures Inc. Though a new Philippine law to allow more competition in the electricity industry will drive down power prices, Pacific Hydro's Harding said most of its output will be sold under long-term contracts. Its next target country may offer even greater challenges. As Nepal struggles to launch an inquiry into the massacre of its royal family, Harding is awaiting the kingdom's decision on whether to accept a bid to build two hydroelectric dams. ``Only one in 14 Nepalese has access to electricity, so there is quite a demand for power within Nepal and northern India,'' Harding said. Because of rivers that run from the Himalayas, the world's tallest mountain peaks, ``Nepal has the best hydro resources in the world.'' Pacific Hydro, which has risen 67 percent in the year to date, rose 35 cents, or 8.8 percent, to A$4.32. Metro Council status quo for blacks Hispanic growth likely to affect white wards Gary Washburn, Tribune staff reporter 06/07/2001 Chicago Tribune North Sports Final ; N 1 (Copyright 2001 by the Chicago Tribune) The Chicago City Council on Wednesday approved a blueprint for drawing new ward boundaries that calls for maintaining the current level of African-American representation in the council. In practical terms, passage of the measure means that growth in the number of Hispanic wards--something that is a foregone conclusion given new census numbers that show explosive Latino population increases--is likely to come out of the current total of white wards. There now are 23 wards with majorities of white voters, 20 with African-American majorities and seven Hispanic. Because of a slight population decline among African-Americans and, more importantly, a dispersion of population from historically black South Side neighborhoods to other areas of the city, African- American aldermen feared losing a seat. But the ordinance passed Wednesday calls for a remap that "avoids retrogression in the voting strength" of minorities protected by the federal Voting Rights Act, a provision aimed directly at maintaining African-American strength in the council. "We are not going to get into a fight with Hispanics [and] we are not going to give up any wards in this world or the world to come," declared Ald. Ed Smith (28th), who represents a predominantly black ward on the West Side. Despite the apparent victory for the council's black caucus, Ald. Dorothy Tillman (3rd), one of its members, voted against the plan. She complained that she is being denied an attorney to represent her as the remap process begins to pick up steam. Though the black caucus recently chose attorney Burton Odelson to represent its interests, Tillman said she now has misgivings about the selection, saying that Odelson is a conservative who has represented Republicans in the past. Ald. Richard Mell (33rd), chairman of the council's Rules Committee, rejected Tillman's request to hire James Montgomery, a former city corporation counsel. Individual aldermen do not have the right to have representation funded by the city, Mell asserted. He suggested Tillman's concern has more to do with changes in her ward, which has lost more than 17,000 residents and faces a potentially radical boundary change, than with Odelson's politics. Ald. Joe Moore (49th) and Ald. Michael Wojcik (30th) also voted against the remap blueprint, objecting to a parliamentary maneuver used by the majority to force consideration of the measure on Wednesday. Wojcik's ward is one of those expected to be majority Hispanic in the new map. But the opponents were snowed under by a 44-3 vote. Among other provisions, the blueprint also spells out the number of public hearings to be held before a new map is drawn, mandates creation of an Internet site where citizens can get information on the redistricting process and requires a "redistricting impact statement" explaining how the new map that will be drawn complies with the Voting Rights Act and state and federal constitutions. In other action, Mayor Richard Daley introduced a proposal calling for the purchase of 60 percent of the electricity used in city buildings and other municipal facilities from Houston-based Enron Corp. Under a deal negotiated with the energy-provider, the city would reduce its $50 million-a-year electric bill by about $3 million, officials said. Commonwealth Edison Co., now the city's sole provider, would supply the remainder of the city's electricity needs if the agreement is approved by the City Council. Officials in California have accused Enron and other energy providers of limiting supplies to drive up prices there. "We are more than well aware of the implications of California and the fact that that Enron is involved in that market," said city Environment Commissioner William Abolt. "We think that generally nobody is going to come out of that with clean hands, from government to regulators to companies that are supplying energy." Enron has stood by its contracts with its customers to provide power at agreed-upon rates, he said. Under the proposed eight-year deal, the city's price would be locked in at a guaranteed level initially and later would be tied to an independent financial index. Also on Wednesday, the City Council voted unanimously to prohibit racial profiling by Chicago police and other law enforcement officers. Officials believe Chicago is the first big city in the nation to approve such a measure. PHOTO; Caption: PHOTO: Ald. Dorothy Tillman (3rd) says Wednesday she is being denied a lawyer to represent her as the city redraws ward boundaries. Tribune photo by Phil Greer. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Enron Plans to Challenge Power Regulator's Order, Paper Says 2001-06-06 23:24 (New York) Mumbai, June 7 (Bloomberg) -- The Indian unit of Enron Corp. plans to challenge an order from the Maharashtra state power regulator that prevents the company from seeking international arbitration, the Business Standard said, without citing people. The regulator barred Dabhol Power Co., the Indian unit of Enron, from seeking arbitration about its payment dispute with the Maharashtra State Electricity Board until June 14, the paper said. Dabhol has decided to challenge the order in court on the grounds that it is beyond the Maharashtra Electricity Regulatory Commission's rights to bar the company from resorting to arbitration, the paper said. Dabhol and the Maharashtra State Electricity Board, its only customer, are in a dispute over power tariffs. The board stopped buying power from Dabhol after the U.S. energy company took steps to end a $3 billion power venture. Commentary Since when does rape equal justice? Steve Chapman Steve Chapman is a member of the Tribune's editorial board 06/07/2001 Chicago Tribune North Sports Final ; N 29 (Copyright 2001 by the Chicago Tribune) The attorney general of California is very unhappy about the state's energy crisis, and he has come up with the perfect solution. It involves a creative type of punishment for Kenneth Lay, chairman of the Houston-based energy company Enron. Though Lay has not been convicted of any crime, Bill Lockyer says, "I would love to personally escort Lay to an 8-by-10 cell that he could share with a tattooed dude who says, `Hi, my name is Spike, honey.' " Let the record show that the chief law enforcement officer for the nation's biggest state regards prison rape as a valuable feature of his correctional system. Soft-hearted souls may lament the sexual victimization of jail and prison inmates by violent sociopaths, but Lockyer's chief concern is that there are some people who have yet to experience this form of justice. It used to be that prison was feared because it meant a prolonged loss of freedom, hard labor, separation from family and, sometimes, violence by guards. But somewhere along the line, Americans got used to the idea that it also involves sadistic sexual abuse with no one doing anything to stop it. Why are we so nonchalant? We might be outraged that anti-social thugs are getting away with horrific new crimes every day, under the very noses of law enforcement. Instead, many people--Lockyer among them--have embraced the proposition that the victims are getting only what they deserve. One of the reasons this phenomenon gets little attention is that it's largely invisible. Even critics can only make educated guesses about the scope of the problem. But it's clearly large. A survey of seven men's prisons in four states, published last year in Prison Journal, found that 21 percent of inmates had been coerced or forced into sexual contact, with 7 percent reporting they had been raped. When Human Rights Watch did a confidential poll of prison guards in an unnamed southern state, they estimated that one in five inmates were victims of such abuse. Inmates said it was more like one in three. Suppose we take a conservative estimate and say that one of every 10 inmates suffers this misfortune. With more than 1.8 million men behind bars at any given time, that means at least 180,000 inmates are forcibly violated every year. And that's not counting what goes on in juvenile facilities. For comparison's sake, in the entire United States, there were 124,730 reported rapes of females in 1999. How can sexual abuse possibly be regarded as an appropriate part of serving time? Some of the victims are vicious thugs themselves. But many people in prisons and jails were arrested for nonviolent offenses. Many of us, if a close relative were found guilty of one of these crimes, would think he should pay for his offense by losing his freedom for a long while. But few of us would agree he deserves to be beaten, stabbed, sodomized and infected with AIDS, which is what prison often means. If a judge were to give a convict a sentence like that, it would be ruled cruel and unusual punishment. Lockyer might not have the stomach to actually watch one of the encounters that he finds so amusing. One inmate interviewed by Human Rights Watch had complained to guards after being raped. His assailant then beat him with a combination lock--breaking his neck, jaw, collarbone and finger, dislocating his shoulder, and giving him two serious concussions--before raping him again. Afterward, the victim could read the word "Master," the brand of the lock, on his forehead. Many inmates submit rather than risk being stomped to a pulp. Atrocities like this happen all the time, mainly because hardly anyone minds. Authorities have no great incentive to take the problem seriously because they generally can't be held liable for attacks. In overcrowded, understaffed facilities, prevention may be impossible. Prosecutors, meanwhile, see no need to seek punishment. Treating prison rape like the crime it is would deter some attacks. Prisons could also act swiftly to segregate the perpetrators from the rest of the inmate population. The surest remedy is also the most expensive: Put all prisoners in one-man cells, so they don't have to sleep with one eye open. Or maybe we should just require all government officials with responsibility for prisons and jails to spend a couple of nights a year in one of their own facilities. Since you're already acquainted, Mr. Lockyer, you'll be rooming with Spike. ---------- E-mail: schapman@tribune.com GRAPHIC; Caption: GRAPHIC: Illustration by Dean Rohrer. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. PPA in force, claims DPC S Ravindran Mumbai 06/07/2001 Business Standard 3 Copyright © Business Standard The Dabhol Power Company could continue billing the Maharashtra State Eelctricity Board from its second phase, which was due to start operations on June 7. Sources close to DPC told Business Standard: "If MSEB had cooperated with DPC, commercial production could have begun tomorrow. Under the PPA, they would have been forced to buy this power." "While MSEB contends that it has rescinded the PPA, DPC claims that it continues to be in force. Under these circumstances, DPC will definitely charge MSEB for the second phase power at some future date," sources added. MSEB has stopped buying power from DPC. Meanwhile, lenders to DPC are yet to arrive at a decision on the issue of the transfer notice being served to the MSEB. "The lenders are yet to get back to DPC with their views on the subject," sources said. This was one of the DPC executives' suggestions to the lenders. The mothballing of the 1,444 mw second phase of the project was also discussed. DPC executives also spelt out the differences between the company and the Godbole panel to a consortium of Indian and foreign lenders. "DPC representatives pointed out that there was a chasm between the Godbole panel members and the company. The bone of contention is the plant load factor (PLF) at which DPC will sell power to MSEB. DPC is keen on a PLF of 90 per cent which will bring down the tariff. The Godbole panel wants a much lower offtake of power by MSEB," sources close to DPC told Business Standard from Singapore. The meeting was attended by Enron India managing director K Wade Cline, DPC president and CEO Neil McGregor and representatives of Indian FIs and banks like IDBI, ICICI, SBI. DPC executives will hold another round of talks with the lenders tomorrow. Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved. Calif Eyes Ending Access To Alternative Power Suppliers By Jason Leopold Of DOW JONES NEWSWIRES 06/06/2001 Dow Jones Energy Service (Copyright © 2001, Dow Jones & Company, Inc.) LOS ANGELES -(Dow Jones)- California utility regulators appear ready to vote next week on a proposal to suspend the ability of large electricity users to sign contracts directly with energy suppliers. The move is called for in the February bill that put the state in the power business, but its approval by the California Public Utilities Commission would damp plans in the Legislature to reduce the burden on Edison International (EIX) unit Southern California Edison by making large industrial customers responsible for securing their own power. "We're still trying to figure that out," said an aide to Assembly Speaker Pro Tem Fred Keeley, D-Boulder Creek. "We don't know how to get around that right now." Keeley is expected to introduce legislation to shift the burden of rescuing Southern California Edison to large businesses. Under the proposal, which is also supported by Assembly Speaker Robert Hertzberg, customers that use 500 kilowatt-hours of power a month or more would pay a surcharge on their bills to help Southern California Edison recoup its losses on wholesale power. The so-called direct-access component - under those large users would buy their power from suppliers - is the cornerstone of the Keeley plan, for which Enron has been lobbying hard in recent weeks, according to several aides to key legislators. The Keeley plan is an alternative to the memorandum of understanding Gov. Gray Davis signed with Southern California Edison two months ago. Under that proposal, the state would buy Southern California Edison's power lines for $2.76 billion and allow the utility to issue $2 billion in bonds backed by ratepayers to recover $3.5 billion in net uncollected power costs. That plan has run into snags in the Legislature, which must enact it into law, and the PUC, which has been slow to rule on enabling measures. One key Democratic Senator said the PUC's move to quash direct access is an attempt to ensure a deal to rescue Southern California Edison doesn't pass through the Legislature. "The PUC has demonstrated it does not want SoCal Ed to remain solvent," the senator said. "They have dragged their feet on several key issues they need to address in order to make sure legislation to save the utility is never heard." A PUC spokesman didn't return calls for comment. Direct-access was the key part of the state's 1996 deregulation law, giving retail customers the opportunity to choose from a variety of energy suppliers in an effort to lower their electric rates. Commissioners Richard Bilas and Henry Duque said they support direct access and would vote against any measure to reverse it. "I would never vote against direct access," said Bilas, a Republican, who authored the agenda item. Bilas said the item was amended by another commissioner. The measure could be held, because it might disrupt negotiations between the Legislature and Southern California Edison, said PUC Commissioner Geoffrey Brown, a Democrat. The PUC may be looking to protect the state's interest as a power purchaser, some legislative aides said. The DWR's long-term power supply contracts cover the state's wholesale-market power needs in 2002 and 2003. If large industrial customers were to sign direct-access contracts, the DWR would lose them as customers and thus fail to collect enough revenue to pay off the long-term contracts. The agency could be stuck with a large surplus of electricity that it would be forced to sell it on the open market at a loss. The market price of power in the coming years is expected to be lower than what the state paid for forward power in 2001. Wholesale power prices plunged this week, and the DWR for the first time sold excess power on the open market, according to Oscar Hidalgo, DWR spokesman. Arnold Rosenthal, of Newport Beach-based Utility Resource Management Group, an organization that represents more than 700 large electricity users in the state, said state regulators are "looking to get us back into a mode where we are held captive once again." "The DWR is acting as this super utility," Rosenthal said. "What you're left with is absolutely no choice. Instead, we'll be subjected to several large rate increases." Rosenthal said some of his San Diego clients have direct access deals. A number of clients served by Southern California Edison want to sign direct-access contracts to escape recent rate increases imposed by the PUC. -By Jason Leopold, Dow Jones Newswires; 323-658-3874; jason.leopold@dowjones.com Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.
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