----- Forwarded by Sharonda Stephens/Corp/Enron on 01/23/2001 09:01 AM -----

	"ANN SCHMIDT, ENRON CORP." <ENRONPR@bloomberg.net>
	01/23/2001 08:58 AM
		 
		 To: sharonda.stephens@enron.com
		 cc: 
		 Subject: (DJN ) WSJ(1/23):UPDATE:Enron Mulls Offer To Supply Power In


         enron story




WSJ(1/23):UPDATE:Enron Mulls Offer To Supply Power In Calif.
1/23/1 0:26 (New York)


  By Rebecca Smith
  Staff Reporter of The Wall Street Journal
  Enron Corp., a major energy-trading concern, is considering making an offer
to supply California's beleaguered utilities with at least some of the power
they need, at fixed prices.
  Meanwhile, Houston-based Enron reported that its earnings, excluding
nonrecurring items, jumped 34% in the fourth quarter, helped by big boosts in
natural-gas and electricity-trading volumes.
  Enron already supplies power, at a price of $55 a megawatt hour, to United
Illuminating Co., a utility unit of UIL Holdings Corp. in New Haven, Conn.,
"and we would be the natural person to do something similar in California,"
though the price likely would be higher, said Jeffrey Skilling, Enron's
president and chief executive-elect.
  Mr. Skilling said California officials have much work to do on the state's
energy infrastructure, if they want to get prices down to a tolerable level,
following in effect a meltdown of the state's electricity market in the past
month. State officials must get many more power plants constructed and new
transmission lines built, both in a fraction of the time it now takes, he 
said.
With assurances of more electricity and fewer transmission bottlenecks in the
near future, prices would drop, he said.
  Aggressive action by the state "would affect prices in a significant way,"
Mr. Skilling said. "Otherwise there's a big premium that will continue to be
built into the prices."
  Yesterday Enron reported fourth-quarter net income fell 77% to $60 million,
or five cents per diluted share, from $259 million, or 31 cents a share, a 
year
earlier. The sharply lower net reflected the impact of a $326 million charge
related to Enron's investments in faltering Azurix Corp., a global water
business that was spun off into a separate company two years ago.
  Excluding the impact of Azurix, Enron earnings jumped 34% to $347 million
from $259 million a year earlier on revenue that surged to $40.7 billion from
$10.9 billion. It's not clear how much money Enron made in California, where
the company has only a tiny generation presence but is a major trader.
  Profit for Enron's commodity sales business jumped 256% for the quarter to
$538 million from $151 million a year earlier, lifted by natural-gas and
electricity trading. For the year, the volume of natural gas traded by Enron
jumped 77% to 24.7 trillion British thermal unit-equivalents per day, and
electricity volumes grew, year over year, by 52% to 579 million megawatt hours
in North America. Volumes expanded in Europe, from a much smaller base, by 
131%
to 3.6 trillion BTU-equivalents per day for gas and by 372% for electricity to
55 million megawatt hours.
  The company also logged strong gains in its retail energy-services division
that signs long-term power supply contracts with big businesses. Its pretax
earnings jumped to $33 million from $7 million a year earlier. Mr. Skilling
said, "The phone has been ringing off the hook in California" because of price
volatility and threats to stable supplies in recent weeks.
  EnronOnline, the company's Web-based commodities-trading platform, continued
to surpass expectations. The venture ended the year having completed
transactions with a gross value of $336 billion and now trades about 1,200
wholesale-commodity contracts for dozens of products, including energy, pulp
and paper, metals and telecommunications bandwidth or capacity on fiber-optic
networks.
  Its broadband-trading venture, which the company pioneered, executed 2,400
contracts for DS-3-equivalent months of capacity in the fourth quarter,
compared with 1,400 in the previous period.
  ---
  Journal Link: See a video report of Enron President and CEO-elect Jeffrey
Skilling discussing his company's earnings and California's energy crisis, in
the online Journal at WSJ.com.
  (END) DOW JONES NEWS  01-23-01
  12:26 AM- - 12 26 AM EST 01-23-01