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Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Steven J Kean X-To: Greg Whalley X-cc: X-bcc: X-Folder: \Lawrence_Whalley_Dec2000\Notes Folders\All documents X-Origin: Whalley-L X-FileName: gwhalley.nsf ----- Forwarded by Steven J Kean/NA/Enron on 11/28/2000 11:05 AM ----- Karen Denne 11/27/2000 04:33 PM To: Steven J Kean/NA/Enron@Enron, Richard Shapiro/NA/Enron@Enron, Jeff Dasovich/NA/Enron@Enron, Paul Kaufman/PDX/ECT@ECT, Sandra McCubbin/NA/Enron@Enron, Mona L Petrochko/NA/Enron@Enron, Mark Palmer/Corp/Enron@ENRON, Peggy Mahoney/HOU/EES@EES cc: Subject: Duke Energy proposes to manage SDG&E's entire electricity load for five years fyi... ---------------------- Forwarded by Karen Denne/Corp/Enron on 11/27/2000 03:58 PM --------------------------- tcwillia@duke-energy.com on 11/27/2000 02:23:42 PM To: "Andy Brown (IEP)" <runwithmee@aol.com<, Bob Escalante at Constellation <Bob.escalante@powersrc.com<, Curtis Keebler at Reliant <curtis_l_kebler@reliantenergy.com<, Greg Blue <gtbl@dynegy.com<, "Jack Pigott @ Calpine" <jackp@calpine.com<, Jan Smutny-Jones <smutny@iepa.com<, "Joe Ronan @ Calpine" <joer@calpine.com<, John Stout for Reliant <john_h_stout@reliantenergy.com<, "Julie @ Edson" <jmball@ns.net<, "Karen Denne, Enron" <kdenne@enron.com<, Karen Edson <kedson@ns.net<, "Kassandra Gough @ Calpine" <kgough@calpine.com<, Katie at IEP <kaplan@iepa.com<, Lynn Lednicky at Dynegy <lale@dynegy.com<, Marty Wilson <mwilson@pstrategies.com<, Paula Hall-Collins <paula.hall-collins@williams.com<, "Richard Hyde, Duke" <rwhyde@duke-energy.com<, Rob Lamkin <rllamkin@seiworldwide.com<, Roger Pelote <roger.pelote@williams.com<, Stephanie Newell at Reliant <stephanie-newell@reliantenergy.com<, Steven Kelly <steven@iepa.com< cc: Subject: Duke Energy proposes to manage SDG&E's entire electricity load for five years The note below was sent to the 20 or so reporters that I have been working with on the CA electricity crisis. FYI. Below is a press release we distributed today that details a proposal we have made to San Diego Gas & Electric to manage their entire electricity load (up to 3,300 megawatts) for five years at a fixed price of $60 a megawatt hour. The proposal was detailed in our comments to the Federal Energy Regulatory Commission on their recent proposed solutions to Caifornia. As the release indicates, forward contracting for electricity is a very effective way for the state's utilities to manage the volitility in the state's electricity markets. With natural gas prices more than doubling since last year and last week being up to seven times higher than last year on the spot market (up to $19 a million BTU vs. an average of about $2.50 in 1999), we feel that its imperative for utilities to take advantage of these contracts so they can manage their own risk exposure and their customer's risk exposue to this volitility and the associated high prices. (The price of natural gas represents about 90 percent of our plant's operating costs). We signed a forward power contract with PG&E Oct. 30 and Southern Cal Edison Nov. 15 (announced for the first time in the this release). The Federal Energy Regulatory Commission strongly encourages these kind of contracts -- and we hope that we, or other wholesale power marketers, can do more of this kind of business with these utilities and SDG&E in the very near future to bring stability to the state's wholesale electricity market. Our proposal is detailed on pages eight and nine in the FERC filing, which also includes our other positions on the California electricity crisis. These are also detailed on our CA web site at www.Duke-Energy.com/California. For more information, call me at 805-595-4270 or page me at 877-364-5170. (See attached file: Nov 27 release.doc)(See attached file: Duke Nov. 22 FERC filing.doc) - Nov 27 release.doc - Duke Nov. 22 FERC filing.doc
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