Energy Market Report
Tuesday, January 15, 2002

*See attached pdf file.
__________________________________________________________
Western Pre-Scheduled Firm Electricity Prices($/MWh)
January 15, 2002 for January 16, 2002

Peak(Heavy)
                   Low      Change     High     Change
NW/N. Rockies     20.00      1.25     21.50      0.25
Mid-Columbia      20.00      1.25     21.50      0.25
COB               23.00      1.50     23.50      0.50
N. California     25.00      2.50     28.00      2.50
Midway/Sylmar       NA        NA        NA        NA
S. California     25.00      2.00     27.25      1.00
Mead              25.00      2.25     27.00      1.25
Palo Verde        23.95      1.95     27.50      1.50
Inland SW         23.95      1.95     27.75      1.75
4-Corners         24.00      1.50     26.00      2.50
Central Rockies   19.75      2.00     24.00      2.00
__________________________________________________________
Off-Peak(Light)
                   Low      Change     High     Change
NW/N. Rockies     16.25     -0.25     17.50      0.25
Mid-Columbia      16.25     -0.25     17.50      0.25
COB               17.25      0.75     17.50     -1.50
N. California     17.25      0.25     20.00      1.00
Midway/Sylmar       NA        NA        NA        NA
S. California     16.75      0.00     19.50      0.75
Mead              18.00      1.00     19.00      0.75
Palo Verde        16.00      0.00     18.25      0.25
Inland SW         16.00      0.00     19.00      0.75
4-Corners         16.00      0.00     17.00      0.00
Central Rockies   14.50      1.50     16.00      1.00
__________________________________________________________
Andersen Partners Feel the Heat

Day-ahead peak power prices continued to rise in the Western U.S. Tuesday
amid expectations of stronger weather-related demand and higher natural gas
values.  Some parties also believed that an increase in the amount of
off-line generation had something to do with strengthening the daily market.
Not surprisingly, the real talk of the town on Tuesday surrounded the
ongoing Enron saga.  Enron Corp and Swiss bank UBS Warburg detailed their
agreement on Tuesday to split profits from Enron's trading business.  Under
the terms of the deal, UBS would take over the unit and pay Enron 33 percent
of profits for up to 10 years.  The deal give UBS the right to buy one-third
of Enron's royalty interest in the third year of the deal based on the
previous year's profit.  UBS could buy another third in year four, and the
final third in year five.  The deal still requires approval from Judge
Arthur Gonzales of federal bankruptcy court, which may come at a hearing
scheduled for Friday.  While this was good news for some Enron employees, it
was not all roses for the one-time energy-trading giant on Tuesday.  The
NYSE suspended trading of Enron shares and related securities while it
worked to "delist" the stock because of the "expected protracted nature" of
Enron's bankruptcy case and the impact it will have on the company's
stockholders.  In our "if I'm going down, I'm taking you with me" category,
Andersen fired David Duncan, the lead partner for the Enron audit, on
Tuesday for his alleged role in destroying documents related to its review
of Enorn Corp.'s books.  Andersen said thousands of emails and large numbers
of paper documents related to Enron were destroyed shortly after Duncan
learned on October 23 of a an SEC request for information on the audit of
Enron.  Duncan was scheduled to meet with congressional members on
Wednesday.  In addition to the firing of Duncan, Andersen said it put three
other partners involved in Enron's audit on leave, and four Houston-based
partners were relieved of their management responsibilities.  One market
analyst said of the Enron-Andersen fiasco, "People are going to go to jail
over all this, but they'll be in good company."

Peak power prices rose by an average of 75 cents in the Northwest on
Tuesday, largely the result of rising heating demand.  "Our in-house
forecaster is now saying that the cold weather is going to be more severe
and more prolonged than previously expected," claimed one Northwest utility
trader.  Meanwhile, the latest six-to-ten from the NWS continued to call for
below-normal temperatures across the entire region through January 25.  Flow
forecasts for Chief Joseph were revised upward on Tuesday, which surprised
several players since colder weather typically means less runoff and side
flows.  Flows were projected to be 110 kcfs through Thursday, 100 kcfs
Friday, 65 kcfs Saturday, 55 kcfs Sunday, 100 kcfs Monday, and 95 kcfs next
Tuesday.  In unit news, Bridger #3 (520 MW) was reportedly back in service
Tuesday, but the returning megawatts were more than offset by a tube leak
outage that occurred at Colstrip #4 (700 MW).  An official ETR for the
Montana-based Colstrip unit could not be obtained, but was presumed to be
between 48 and 72 hours.

Amid stronger natural gas prices at the Southern California border and
colder weather across the state, day-ahead electricity prices strengthened
across the Golden State on Tuesday.  "Outages are on the rise and the
extended forecasts still look cold," explained one California utility
trader.  Peak power deals at NP15 were done from 25 to 28$/MWh, and
balance-of-January contracts were heard from 25.25 to 26.25$/MWh.  SP15
goods for Wednesday delivery were priced below NP15 deals, but by less than
a buck, and BOM was quoted at 26$/MWh.  On the generation front, nuclear
unit Diablo Canyon #2 (1,087 MW) was operating at 50% capacity on Tuesday
for maintenance on the secondary or non-nuclear side of the plant.  It was
expected to ramp back up to full power sometime over the weekend.  As for
gas units, Encina #5 (332 MW) was generating at 290 MW, on its way back from
a planned maintenance outage that started January 11, and Etiwanda #3 (320
MW) powered up to 150 MW, returning from an outage that began December 22.
Temperature forecasts called for highs to reach 64 degrees on Wednesday at
southern load centers, while highs in the mid-50s and upper-40s were
expected at mid-state.  Temperatures were expected to stay two to six
degrees below normal through Saturday, and the latest six-to-ten called for
continued below-normal conditions from January 21 to 25.

Cooler weather and rising spot gas prices gave the daily electricity market
in the Southwest a lift on Tuesday.  Peak power at Palo Verde traded from
23.95 to 27.5$/MWh, with the bulk of transactions heard between 25.75 and
26$/MWh.  According to Weather Derivatives, heating demand in the desert
region was forecast to average 116 percent of normal through January 22,
while the latest six-to-ten from the NWS calling for a combination of normal
and below-normal temperatures from January 21 through 25.  In unit news, San
Juan #4 (534 MW) was having trouble retuning from tube-leak repairs that
began on January 10.  The New Mexico-based thermal unit had reportedly
ramped up to about 75 percent of capacity, but an ETR to full was not
available as of this writing.



Patrick O'Neill and Jessie Norris
_________________________________________________________

Western Generating Unit Outages

Current                            Begins          Ends          Reason
CAISO units <250/7871 total          NA             NA
planned/unplanned*
Alamitos #3/320/gas               04-Dec-01         ?            planned
Alamitos #4/320/gas               04-Jan-02         ?            planned
Bridger #3/520/coal               12-Jan-02     14-Jan-02        tube leak
Colstrip #3/700/coal              11-Jan-02     18-Jan-02        repairs
Colstrip #4/700/coal              15-Jan-02     18-Jan-02        tube leak*
Diablo Canyon #2/1087/nuclear     15-Jan-02     20-Jan-02   @50%,
maintenance*
Encina #4/303/gas                 12-Jan-02         ?            unplanned
Four Corners #5                   09-Jan-02     14-Mar-02        maintenance
Grand Coulee #19/600/hydro        10-Dec-01       March          repairs
Haynes #6/341/gas                 07-Jan-02         ?            planned
Helms PGP #2/407/hydro            01-Oct-01         ?            planned
Hyatt/Thermalito/933/hydro        02-Oct-01         ?      @506 MW,
unplanned
Morro Bay #3/337/gas              04-Jan-02         ?            planned
Moss Landing #6/739/gas           11-Jan-02         ?           unplanned
Moss Landing #7/739/gas           29-Dec-01         ?            planned
Naughton #3/330/gas               13-Jan-02     16-Jan-02        tube leak
Ormond Beach #1/725/gas           28-Dec-01         ?            planned
Ormond Beach #2/750/gas           05-Oct-01         ?      @350 MW,
unplanned
Pittsburg #6/317/gas              22-Nov-01         ?            planned
Redondo #8/480/gas                09-Dec-01         ?            planned
San Juan #4/534/coal              10-Jan-02     15-Jan-02       tube leak*

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

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

January 15, 2002 for January 16, 2002

Peak (Heavy) in $/MWh
                 Low     Change   High      Change
Into Cinergy    17.75     1.75    18.75      0.25
Western PJM     22.80     0.80    23.05     -0.60
Into Entergy    18.95     0.95    22.35     -0.15
Into TVA        20.00     2.00    21.50      0.00
___________________________________________________________
Amid stronger natural gas values, average peak power prices firmed up across
the Eastern Interconnect again on Tuesday. "Crude oil prices were up today
which in turn drove natural gas higher, and the dailies rallied on gas
support, especially in the Southeast," commented one much-encouraged
marketer.  NYMEX Henry Hub natural gas futures settled higher.  February
climbed 4.1 cents to end at 2.291$/mmBtu, while March gained 3.3 cents to
close at 2.273$/mmBtu.

On the assumption of healthier generation, heavy load energy costs slipped
by less than a dollar in the Mid-Atlantic on Tuesday.  "I'm hearing the
Keystone unit is back, and the Salem outage should be over as well," said
one usually accurate PJM source.  Western PJM goods for Wednesday delivery
traded between 22.8 and 23.05$/MWh, and the February contract saw action
from 24.5 to 24.7$/MWh, losing about a dime to a day ago.  The NRC
admonished the operators of Pennsylvania-based nuke Limerick #2 (1,115 MW)
for not having sufficient safety measures in place for a worn-out relief
valve.  The NRC gave the problem a "white" rating, their second lowest
classification indicating a low to moderate safety violation, but said they
may conduct further inspections at the plant.  There was no word yet on when
the unit would be off-line for the repair.  Real-time prices were lower on
Tuesday, and averaged 19.85$/MWh through 15:00 EST.  The mercury was
expected to dip on Wednesday, with high temperatures anticipated in the
low-to-mid-40s and low temperatures at or near freezing.  The most current
six-to-ten from the NWS predicted above-normal temperatures from January 21
to 25.

As weather forecasts for Wednesday projected temperatures about five degrees
above normal, day-ahead peak electricity prices edged up in the Midwest on
Tuesday.  Into Cinergy deals were done between 17.75 and 18.75$/MWh, picking
up a quarter on the high end and almost two dollars on the low.  February
saw action from 20.2 to 20.65$/MWh, with the vast majority of deals done at
20.5$/MWh.  In unit news, traders said Cook #2 (1,090 MW) was expected to
exit the grid on Friday for a refueling outage.  The unit has been powering
down since last Wednesday.  High temperatures on Wednesday were forecast to
be in the upper-30s, and corresponding lows were expected in the mid-20s.
The latest six-to-ten called for mostly above-normal conditions, with normal
temperatures in Michigan and Indiana, from January 21 to 25.

With long-awaited strength in the gas market, peak power prices rose in the
Southeast on Tuesday.  Into Entergy deals were heard from 18.95 to
22.35$/MWh.  Traders said the front-month contract rallied, driven mostly by
the dailies, with transactions completed between 19.3 and 19.6$/MWh.  Into
TVA pieces were bought and sold from 20 to 21.5$/MWh.  Temperatures were
expected near normal to slightly above normal through Saturday, with lows
only forecast in the upper-30s to low-40s.  The most current six-to-ten
called for above-normal temperatures from January 21 to 25.
___________________________________________________________

California ISO Congestion Index in $/MWh

                         Path                 Peak   Off-peak
for 16-Jan-02         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            19.50    20.50    24.25    25.25    25.50    26.50
February       19.25    20.75    23.00    24.00    24.75    25.75
March          17.50    19.00    22.50    23.50    23.75    24.75
April          17.50    19.00    24.00    25.00    23.50    24.50
Q2 '02         17.50    19.00    25.50    26.50    25.50    26.50
Q3 '02         31.00    32.50    39.50    40.50    38.50    39.50
Q4 '02         26.00    27.50    26.50    27.50    28.00    29.00
Q1 '03         25.50    27.00    26.25    27.25    28.50    29.50
Cal '03        27.50    29.00    30.50    31.50    32.00    33.00

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  14-Jan-02       41.04     40.90       24.76      36.07     3.95



BPA's Offer for 01/17/02 and 01/18/02.

Hours        Amount          NW delivered        COB/NOB delivered
7-22         100MW           Market Price*          Market Price*
1-6, 23-24   100MW           Market Price*          Market Price*

*Market price will be determined at time of request.



NYMEX Henry Hub Gas Futures in $/mmBtu

                 Close        Change
        Feb      2.291         0.041
        Mar      2.273         0.033



Natural Gas Spot Prices in $/mmBtu

                  Low          High
Sumas             2.05         2.10
So. Cal Border    2.23         2.28
San Juan          2.08         2.13
__________________________________________________________

Economic Insight, Inc. - 3004 SW First, Portland, Oregon 97201,
Telephone (503) 222-2425, Internet e-mail emr@econ.com -
Copyright, Economic Insight, Inc. 2002.