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Bloomberg Energy Department

05/31 Bloomberg Daily Power Report

Table

                      Bloomberg U.S. Regional Electricity Prices
      ($/MWh for 25-50 MWh pre-scheduled packages, excluding transmission costs)

                            On-Peak
West Coast                   Index       Change       Low         High
 Mid-Columbia                150.00      -28.90      149.00      155.00
 Ca-Or Border                140.00      -38.33      140.00      150.00
 NP15                        148.93      -5.69       125.00      170.00
 SP15                        149.91      -23.89      120.00      156.00
 Ault Colorado               136.67      +6.67       120.00      156.00
 Mead                        185.00      +15.00      180.00      190.00
 Palo Verde                  174.96      +10.37      150.00      200.00
 Four Corners                174.29      +9.29       165.00      200.00

Mid-Continent
 ECAR                        20.35       +0.99       19.14       21.86
  East                       23.00       +0.00       22.00       24.00
  AEP                        20.50       +0.80       18.00       23.00
  West                       18.33       +1.00       17.00       20.00
  Central                    18.60       +0.99       18.00       20.00
  Cinergy                    18.60       +0.99       18.00       20.00
  South                      20.75       +3.08       20.00       22.00
  North                      22.67       +0.07       21.00       24.00
 Main                        19.31       +1.03       16.75       21.13
  Com-Ed                     18.06       +1.87       16.50       19.25
  Lower                      20.56       +0.18       17.00       23.00
 MAPP                        20.64       -1.74       19.50       21.50
  North                      21.00       -1.17       20.00       22.00
  Lower                      20.29       -2.31       19.00       21.00

Gulf Coast
 SPP                         21.50       -3.25       19.50       24.00
  Northern                   19.50       -4.00       18.00       22.00
 ERCOT                       36.75       +1.62       36.00       37.50
 SERC                        28.07       -0.95       24.75       31.63
  Va Power                   22.50       -0.63       20.00       25.00
  VACAR                      22.50       -1.00       20.00       25.00
  Into TVA                   20.75       +3.08       20.00       22.00
  Out of TVA                 24.55       +3.94       23.77       25.88
  Entergy                    26.79       +0.04       25.50       27.50
  Southern                   31.40       -8.60       27.00       40.00
  Fla/Ga Border              48.00       -3.50       37.00       56.00
 FRCC                        63.33       +7.08       55.00       70.00

East Coast
 NEPOOL                      35.90       +0.90       35.25       36.50
 New York Zone J             47.00       -1.75       46.00       48.00
 New York Zone G             42.25       -2.50       41.50       43.50
 New York Zone A             30.50       -4.25       30.00       31.00
 PJM                         23.63       -0.42       23.30       25.00
  East                       23.63       -0.42       23.30       25.00
  West                       23.63       -0.42       23.30       25.00
  Seller's Choice            23.13       -0.42       22.80       24.50
End Table


Pacific Northwest Power Prices Slip Amid Increased Generation

     Portland, Oregon, May 31 (Bloomberg Energy) -- Pacific
Northwest day-ahead power prices slipped today amid increased
hydroelectric generation from the Grand Coulee generating
stations, traders said.
     Traders said the 24 hydroelectric generating stations
produced 42,546 megawatt-hours of generation yesterday, the
highest one-day generation since early March.
     "Generation out of Grand Coulee is the highest I've seen in
quite some time," said one northwest day-ahead power trader. "In
addition to the generation there, the folks below them have to
generate more at there "run of river" plants because there's more
water flowing downstream."
     The Bloomberg Mid-Columbia day-ahead heavy load index price
fell an average of $28.90 a megawatt-hour to $150.00 amid trades
at $149.00-$155.00. Light load energy sold at $75.00-$79.00, an
average of $5.67 less than equivalent trades made yesterday for
delivery today.
     Reservoir data from the U.S. Army Corps of Engineers shows
that at 1,271.6 feet of water, water levels at Grand Coulee are
about 98.6 percent of capacity.
     Traders said continued mountain run-off into the reservoir
is causing dam operators to generate electricity to prevent
spilling water over the dam.
     In California, traders said that the California Independent
System Operator issued at Stage II Emergency today, after
available generation dropped below 5 percent of reserves.
     Traders said the emergency was short-lived as the second day
of Federal Energy Regulatory Commission-ordered load mitigation
proceedures caused demand to fall.
     The new procedures, which went into effect yesterday, impose
price limits on ISO power trades. The limits are set to the price
of the least efficient power-generating unit operating at the
time of the emergency.
     "We saw prices rising to the $150.00-$200.00 level today,
though as soon as the FERC mitigation plan went into effect, the
prices dropped toward the $140.00 level," one western trader
said.
     In the Southwest, power prices climbed an average of $10.37
at the Palo Verde switchyard to a Bloomberg average of $174.96
amid trades in the $150.00-$200.00 range.
     Traders said temperatures were forecast in the low-to-mid
100s Fahrenheit through the weekend, which should keep power
prices elevated at Palo Verde and at the Four Corners trading
point in New Mexico.
     Four Corners heavy load energy traded at a Bloomberg average
of $174.29, $9.29 more than yesterday.

-Brian Whary


PJM Spot Power Prices Continue to Fall With Excess Generation

     Philadelphia, May 31 (Bloomberg Energy) -- Values for peak
power delivered tomorrow into the Western Hub of the Pennsylvania-
New Jersey-Maryland Interconnection fell again today as healthy
generation levels continued to depress real-time prices, traders
said.
     The Interconnection issued a Minimum Generation Alert for
Thursday's midnight period, when generation levels fell below the
1,000-megawatt threshold of normal minimum energy limits.
PJM operating instructions dictate that in situations of
excess capacity, energy deliveries into the control area are
minimized and where possible, energy sales to external control
areas are arranged.
"There's so much generation out there, you can't even give
this stuff away," said one PJM hourly trader. "I had a marketer
call in and offer up 400 megawatts for free, and I couldn't even
take it. Where am I going to put it? Everyone's loads are right
where they should be."
     For-Friday power was assessed 41 cents lower at a Bloomberg
volume-wieghted index of $23.64 per megawatt hour, representing a
67.9 percent year-on-year change from the May 31, 2000 index of
$73.67.
     Next-week values also continued to erode as a function of
excess supply and paltry demand. Since Tuesday, packages for June
4-June 8 have fallen $28.25, or 49.3 percent, to $29.00. Revised
weather forecasts are predicting temperatures for that period will
average 6.1 degrees Fahrenheit below normal, compared to initial
expectations for a 2-degree departure from normal.
     "We're all waiting for that one piece of information to turn
this thing around and it's going to have to be weather, because
there's just no fundamentals to drive it right now," said one PJM-
based trader.
     In the New England Power Pool, day-ahead prices rose slightly
on expectations for possible heating loads. According to Weather
Services Corp. of Lexington, Massachusetts, temperatures will
average as low as 51 degrees in parts of New England tomorrow.
"These low temperatures have kept cooling demand pretty much
at zero this week, but now it looks as if they may actually
generate some heating demand tomorrow, and possibly into next
week."
     Day-ahead prices continued to decline across all three zones
of New York, with Zone J down $1.75 at a Bloomberg index of
$47.00, and Zones G and A down $2.50 and $4.25, respectively, to
$43.75 and $32.00 indices.

-Karyn Rispoli


Mid-Continent Power Prices Mixed With Cool Weather, New
Month

     Cincinnati, May 31 (Bloomberg Energy) -- U.S. Mid-
Continent day-ahead peak power prices were mixed today as
traders closed long-term positions in hub markets while
cool weather continued to suppress demand in the Plains.
     Traders in the East Central Area Reliability Council
and Mid-America Interconnected Network markets said the
advent of the new spot month (June) caused prices to rise
as marketers bought and sold power to close June positions
taken earlier this month.
     "The actual trading in the dailies was light; it was
mostly people closing positions," one trader said. "You had
people buying to cover short positions for June and then
other people selling off long positions to cut their losses
for next week."
     The Bloomberg index price for power delivered Friday
into the Cincinnati-based Cinergy Corp. transmission system
in ECAR rose 98 cents to $18.59 a megawatt-hour, with
trades ranging from $18.00-$19.50.
     "We're going into a new month, and nobody's sure where
things should be right now. No one expected to see anything
like this at this time of year, so it's a little up in the
air," a MAIN trader commented.
     For-Friday parcels at the Chicago-based Commonwealth
Edison Corp. hub in MAIN sold $1.87 higher on average at
$16.50-$19.25 and power in the lower half of the region 18
cents higher at $17.00-$23.00.
     Short-term, over-the-counter, prices in ECAR and MAIN
continued to decline this week as below-normal temperatures
were forecast into next week and natural gas futures
remained under $4.00 per million British thermal units,
traders said.
     Power for delivery from June 4-8 was offered at $24.00
at both Cinergy and ComEd, a decline of over $35.00 from
Tuesday.
     In the Mid-Continent Area Power Pool, atypically low
weather-related demand continued to pull peak spot power
prices down, traders said.
     Next-day power sold $1.17 less on average at $20.00-
$22.00 in northern MAPP and $2.31 less at $19.00-$21.00 in
the southern half of the region.
     Traders said demand was low enough that sales were
made just above utilities' generating costs to keep from
overloading local power grids with excess energy.
     They said if demand continues at current low levels,
utilities could be forced to reduce output at less
efficient units to avoid this problem.

-Ken Fahnestock


Southeast Power Prices Decline Amid Less Demand, Mild Weather

     Atlanta, May 31 (Bloomberg Energy) - Most U.S. Southeast
spot electricity prices for power delivered Friday declined
today because mild weather limited demand for electric power,
traders said.
     The Bloomberg Southeast regional average price declined
$1.69 a megawatt-hour from yesterday to a Bloomberg index of
$27.33 amid trades in the $20.00-$56.00 range.
      Traders said demand typically begins declining on
Friday's as more people take three-day weekends, reducing
loads.
     "With less weather-related demand and the Friday factor
prices are falling a bit,'' said one Southeast marketer.
     In the Virginia-Carolina region, peak power declined 63
cents to a Bloomberg index of $22.50, with trades completed
between $20.00-$25.00.
     According to Lexington, Massachusetts-based Weather
Services Corp., daily high temperatures in Richmond, Virginia,
were expected to reach 75 degrees Fahrenheit today and 73
degrees tomorrow.
     "There is minimal activity in the market because of the
(mild) weather. With temperatures the way they are there is no
reason for prices to increase,'' said one Southeast trader.
     In the Northern section of the Southwest Power Pool,
trades for Northern SPP declined $4.00 to a Bloomberg index of
$19.50, with sales completed at  $18.00-$22.00.Forecasters call
for temperatures in the Southeast to average about 3.1 degrees
Fahrenheit below normal over the next seven days.

-Robert Scalabrino


U.K. Power Rises on Higher Expected Demand in Scant Trade

     London, May 31 (Bloomberg Energy) -- U.K. power prices
climbed today amid expectations of higher heating requirements,
traders said.
     Day-ahead baseload started trade at 17 pounds a megawatt-hour
before being last bid at 18 pounds a megawatt-hour, 1 pound higher
than yesterday.
     Across the U.K., temperatures were forecast to average
between 8-14 degrees Celsius today, falling to 5-13 degrees
Celsius tomorrow, according to the Weather Services Corp. U.S.
     Week 23 traded as low as 17.49 pounds a megawatt-hour today
before rising to trade at 17.89 pounds a megawatt-hour, 15 pence
higher than yesterday on the back of by climbing spot values,
traders said.
     "After the system demand for tomorrow came out much higher
than today's, people started buying up day-ahead and interest
spilled over onto the week 23 contract," one trader said.
     Winter 2001 peak structures also rose today on continued
buying interest amid a combination of participants purchasing the
contract, deeming it undervalued, and in an attempt to influence
prices, traders said.
     "People, mainly generators, would rather sell the contract at
higher levels so they are buying it up now," one trader said.
     Still, another trader disagreed, saying, "too much volume is
going through at the moment for just a few players to try and move
the market. People are just finding the contract cheap, no one
knows what winter will bring under NETA."
     Since the launch of the New Electricity Trading Arrangements
last March, traders have been trading actively in an effort to
find new price levels.
     Activity was unusually quiet today, traders said as an
industry function in the afternoon kept several participants away
from their trading desks.

-Amal Halawi


Nordic Electricity Prices Remain Steady; Spot Value Falls

     Lysaker, Norway, May 31 (Bloomberg Energy) -- Electricity
prices on the Nordic Power Exchange in Lysaker, Norway, closed
steady today because unseasonably low dam levels allowed hydro-
producers to store molten snow without increasing output, traders
said.
     Week 23 closed up 0.5 Norwegian kroner at 204.0 kroner a
megawatt-hour with 82.0 megawatts traded. Week 24 closed unchanged
at 207.0 kroner a megawatt-hour after 126.0 megawatts were
exchanged.
     "Since prices haven't fallen with the inflow of melting snow
and low consumption because of higher temperatures, it's very
unlikely that they will later this year with increased demand and
reduced hydro-supply,'' an Oslo-based trader said.
     Friday's system area average price fell 5.00-10.00 kroner
more than expected to 206.60 kroner a megawatt-hour. Traders said
the drop came after producers made a correction from today's high
spot price of 218.15 kroner a megawatt-hour.
     Reduced demand by industrial end-users ahead of the weekend
also contributed to the lower spot value.
     Sweden was reportedly importing power from Finland, a trader
said earlier today. He added Swedish producers were in "full
control'' of output following minimal flooding compared to last
year when generators preferred to sell electricity at lower prices
than to let reservoirs overflow with no economic gain.
     Winter-2, 2001 was little changed at 219.6 kroner a megawatt-
hour with 40.0 megawatts traded.
     Across Scandinavia, above-average rainfall was forecast over
the next 5 days, according to Weather Services Corp. in the U.S.
     Traded volumes on Nordpool dropped to 1,030 gigawatt-hours
generation today from 2,022 gigawatt-hours yesterday.

-Alejandro Barbajosa
-0- (BES) May/31/2001 19:51 GMT



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