---------------------- Forwarded by Carla Hoffman/PDX/ECT on 08/16/2000 08:36 
AM ---------------------------
   
	Enron Capital & Trade Resources Corp.
	
	From:  "Pergher, Gunther" <Gunther.Pergher@dowjones.com>                      
     08/16/2000 08:16 AM
	

To: "Leopold, Jason" <Jason.Leopold@dowjones.com>
cc:  (bcc: Carla Hoffman/PDX/ECT)
Subject: DJ Calif ISO Exceeded $250 Cap In Off-system Buys -Sources 



15:13 GMT 16 August 2000 DJ Calif ISO Exceeded $250 Cap In Off-system Buys
-Sources 
NEW YORK (Dow Jones)--The California Independent System Operator had to pay
more than its stated maximum price of $250 a megawatt-hour this week due to
short supplies of electricity in the western U.S. amid high air-conditioning
demand, according to market sources.
Under its price cap rules, the ISO is allowed to exceed its cap in
"out-of-market" purchases, which is when it purchases power in deals
arranged directly with sellers over the phone, rather than through its usual
computer-based purchasing system. The current cap was lowered to $250/MWh
from $500/MWh starting August 7.
The ISO wouldn't confirm that it had to pay more than $250 Monday.
"We're not going to reveal whether this is happening, or at what price,"
spokeswoman Stephanie McCorkel told Dow Jones Newswires. "For the sake of
protecting consumers, we will keep our price strategy confidiential. But any
out-of-market purchase above the cap is very rare."
On Sunday, the ISO agreed to pay about $350/MWh at Palo Verde to a southwest
utility for on-peak Monday power, according to a trader for the utility, who
spoke on the condition of anonymity. Bilateral trades not involving the ISO
were done as high as $375/MWh Monday afternoon in the real-time market.
Other market sources said that the ISO exceeded its cap again Tuesday
afternoon, when several major California generating units were be taken off
line for unplanned repairs, and the real-time market rose to $500/MWh for
one hour at Palo Verde. Those purchases couldn't be confirmed with sellers.
According to its price cap rule, "Such reduced cap shall not apply to
out-of-market calls placed by management to out-of-state generator
resources."
Some market participants say that regular out-of-market purchases above
$250/MWh could persuade suppliers to not offer power to the ISO via its
computer-based system, which has plateaued at $250/MWh for most of both
Monday and Tuesday afternoons.
And owners of generating stations in California say there is no
justification for giving preferential treatment to out-of-state generators. 
-Mark Golden; Dow Jones Newswires 201-938-4604; 
mark.golden@dowjones.com
Copyright (c) 2000, Dow Jones & Company Inc


G_nther A. Pergher
Senior Analyst
Dow Jones & Company Inc.
Tel.  609.520.7067
Fax. 609.452.3531

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