>  <<IPW100101.PDF>> 
> Good Morning,
> 
> Attached, please find the latest issue of our Independent Power Weekly.
> 
> Summary:
> 1. IPP's Rise 3.9%   Last week our IPP composite increased 3.9%,
> underperforming the NASDAQ (+5.3%) and the S&P 500 (+7.8%).  Orion Power,
> which was up 38.1%, was the strongest generator in the group.  AES Corp
> was the weakest performer, declining 47.1%.
> 
> 2. Generation Oriented Utilities Fall 0.6%   Our universe of generation
> oriented utilities fell 0.6%, underperforming the NASDAQ and S&P 500,
> while outperforming the UTY (-4.8%).  Black Hills Corp, which was up 7.5%,
> was the strongest performer in the group.  PPL was the weakest performer,
> declining 11.9%.
> 
> 3. Some Good News and Some Bad News   Last week saw considerable stock
> price volatility as investors focused on 3 key events: 1. Reliant
> Resources acquires Orion Power; 2. AES Corp. (Restricted) issues earnings
> warning; and, 3. CPN reaffirms earnings guidance.  
> 
> 4. IPPs Trading 22% Below Private Market Asset Value   We believe the
> RRI/ORN transaction provides additional support for our private market
> valuation framework.  Our analysis indicates that as a group, the major
> IPPs are trading at a 22% average discount to their private market asset
> values.  NRG Energy and Reliant Resources are trading at the most
> significant discounts to their private market values--30% and 35%.  We
> believe the disparity between public and private market valuations is
> unsustainable.  
> 
> 5. Power Market Update   Last week power prices were down across the
> country.  Generally we continue to see a trend of power prices moving down
> in "lock-step" with natural gas prices.  While the Mirant National Power
> Index fell 12% last week, the Natural Gas Week composite spot price fell
> 13%.  Also contributing to the weakness was seasonally mild weather ahead
> of the normal October power plant maintenance season.   
> 
> Regards,
> 
> Neil Stein   212/325-4217
> 

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