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Enron Mail |
Group,
Wanted to make sure you were aware of the latest developments... They will likely not influence us, but, they may influence those we are trading with. Be sure to lock down all the specifics of your trades as you make them (for example... firm, non-firm, til further, one hour only, etc.), so that no possiblity for a discrepancy exists. Bill ---------------------- Forwarded by Bill Williams III/PDX/ECT on 01/08/2001 09:01 AM --------------------------- Alan Comnes@ECT 01/08/2001 08:21 AM To: tim.belden@enron.com, robert.badeer@enron.com, sean.crandall@enron.com, bill williams iii@enron, chris.foster@enron.com, greg.wolfe@enron.com, jeff.richter@enron.com cc: Subject: US DOE Extends Calif Pwr Emergency Order Through Jan. 10 To: Traders/Marketers: Note reporting requirement above $64/MWh. Please give me feeback on how this latest order is affecting us. Please copy on any communications we get from the ISO or the DOE. Thanks, Alan Comnes US DOE Extends Calif Pwr Emergency Order Through Jan. 10 01/08/2001 Dow Jones Energy Service (Copyright © 2001, Dow Jones & Company, Inc.) (This article was originally published Friday) WASHINGTON -(Dow Jones)- The U.S. Department of Energy has extended through Jan. 10 an emergency order requiring power producers to supply California's troubled electricity market. But the latest extension of DOE's seldom-used emergency authority imposes two new significant conditions on the mandatory power sales. First, DOE is requiring California to certify within a week's time that it has taken steps to reduce electricity demand by 5% during periods of peak demand. In addition, the order requires that any negotiated power prices above $64 per megawatt-hour be submitted to the U.S. Federal Energy Regulatory Commission for review to assure the sales price is "just and reasonable." The latter provision appears aimed at addressing the above-market prices sellers are requiring as a risk premium given credit concerns surrounding the state's financially troubled utilities. The Federal Power Act, as amended by Congress in the 1970s, gives the secretary of energy broad authority to order power sales in the event of war or any emergency that threatens "a shortage of electric energy." Energy Secretary Bill Richardson first invoked the seldom-used emergency authority Dec. 14, as power producers and marketers balked at supplying electricity to California unless they received credit guarantees. The order was seen as helping the state avert imminent rolling blackouts in the face of tight power supplies and skyrocketing prices, which have sent California utilities to the brink of insolvency. The order requires all power producers and marketers who supplied power to California in the 30 days prior to the Dec. 14 order to deliver any uncommitted power when the California Independent System Operator declares its electricity supply inadequate. The original order provided that, in the event the ISO and power providers can't agree on a price, the Federal Energy Regulatory Commission would determine "a just and reasonable rate" for the mandated power sales. The revised order means that FERC will now determine the justness and reasonableness of virtually all contracts entered into under the emergency order. Friday's action marked the fourth time DOE has extended the order. Last month, when the order was extended through Jan. 5, Richardson said: "It is my sincere hope that further action under my emergency powers will be unnecessary." Richardson said Friday that he hoped last month's extension would be the last, but that circumstances dictate the state be given additional time to adjust the problem. -By Bryan Lee, Dow Jones Newswires; 202-862-6647; bryan.lee@dowjones.com Copyright , 2000 Dow Jones & Company, Inc. All Rights Reserved.
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