"Energy Market Report" <emr@econ.com> on 10/26/2001 07:48:51 PM

To:	"Energy Market Report" <emr@econ.com>
cc:	 
Subject:	Energy Market Report - 10-26-01


Energy Market Report
Friday, October 26, 2001

*See attached pdf file.
__________________________________________________________
Western Pre-Scheduled Firm Electricity Prices($/MWh)
October 26, 2001 for October 28, 2001

Peak(Heavy)
                   Low      Change**  High    Change**
NW/N. Rockies*    28.00       NA      29.50     NA
Mid-Columbia*     28.00       NA      29.50     NA
COB*              28.00       NA      28.50     NA
N. California*    25.50       NA      28.00     NA
Midway/Sylmar*      NA        NA        NA      NA
S. California*    25.50       NA      27.50     NA
Mead*             27.00       NA      28.00     NA
Palo Verde*       26.25       NA      28.00     NA
Inland SW*        26.25       NA      28.00     NA
4-Corners*        25.50       NA      27.00     NA
Central Rockies*  20.00       NA      24.00     NA
_________________________________________________________
Off-Peak(Light)
                   Low      Change**  High    Change**
NW/N. Rockies*    28.00       NA      29.50     NA
Mid-Columbia*     28.00       NA      29.50     NA
COB*              28.00       NA      28.50     NA
N. California*    25.50       NA      28.00     NA
Midway/Sylmar*      NA        NA        NA      NA
S. California*    25.50       NA      27.50     NA
Mead*             27.00       NA      28.00     NA
Palo Verde*       26.25       NA      28.00     NA
Inland SW*        26.25       NA      28.00     NA
4-Corners*        25.50       NA      27.00     NA
Central Rockies*  20.00       NA      24.00     NA

*Denotes trading of flat, 24-hour products.
**"NA" changes are not applicable because prices for on and off peak goods
are not comparable to flat products.
_________________________________________________________
Western Pre-Scheduled Firm Electricity Prices($/MWh)
October 26, 2001 for October 29, 2001

Peak(Heavy)
                   Low      Change**  High    Change**
NW/N. Rockies     31.50       NA      33.40     NA
Mid-Columbia      31.50       NA      33.40     NA
COB               30.00       NA      34.50     NA
N. California     32.00       NA      35.25     NA
Midway/Sylmar       NA        NA        NA      NA
S. California     32.10       NA      36.00     NA
Mead              33.50       NA      37.75     NA
Palo Verde        33.00       NA      36.50     NA
Inland SW         32.00       NA      36.50     NA
4-Corners         33.00       NA      33.75     NA
Central Rockies   32.00       NA      33.50     NA
_________________________________________________________
Off-Peak(Light)
                   Low      Change**  High    Change**
NW/N. Rockies     28.00       NA      29.50     NA
Mid-Columbia      28.00       NA      29.50     NA
COB               28.00       NA      28.50     NA
N. California     25.50       NA      28.00     NA
Midway/Sylmar       NA        NA        NA      NA
S. California     25.50       NA      27.50     NA
Mead              27.00       NA      28.00     NA
Palo Verde        26.25       NA      28.00     NA
Inland SW         26.25       NA      28.00     NA
4-Corners         25.50       NA      27.00     NA
Central Rockies   20.00       NA      24.00     NA

**"NA" changes are not applicable because prices for on and off peak goods
are not comparable to flat products.
_________________________________________________________
Intertie De-rated

Amid a backdrop of mild weather and steady to falling loads across the
region, Western peak power prices held steady in Friday trade.  The volume
of trading was exceptionally low and price ranges tightened across every
trading hub, usually with the low end coming up to meet the high.  "Heavy
load volume went way down, but I'm at a loss as to why off-peak demand
continued to trade," mumbled one bewildered player.  One analyst speculated
that with daytime highs near comfortable levels, "heating demand should only
be kicking in at night."  The market did indeed appear unusual throughout
the West on Friday.  Contrary to norms, power at Palo Verde and South Path
sold at a premium to Mid-Columbia pieces.  One possible factor for this
anomaly could be the de-rating of the California-Oregon Intertie from
between three- and four-thousand megawatts to 600 MW for scheduled
maintenance, which will last through October 28.  "This could have
effectively isolated the Pacific Northwest with lower load demands and
near-normal generating capacity, only with nobody to whom to export," one
analyst postulated.  While NYMEX made up for Thursday's losses, spot gas
prices at the Southern California border fell by almost 25 cents on Friday.
The Henry Hub natural gas contract for November climbed 10.3 cents to close
at 3.041$/mmBtu, while December gas trailed along, gaining 8 cents on Friday
's trades to close at 3.183$/mmBtu.

On Friday, Mid-Columbia peak power traded at a discount to power in the
Southwest.  Heavy load pieces traded in a tight range, between 31.5 to
33.4$/MWh on Friday, and this included the usual premium that comes with
trading three days out. One player speculated that the lack of volatility at
Mid-Columbia was due to the "loss of transmission capacity at the
California-Oregon Intertie."  Temperatures were forecast to hover near
normal in the Northwest through the weekend, with reservoir-building
precipitation called for on Friday, Monday and Tuesday.  The latest
six-to-ten predicted near-to-above normal temperatures would prevail from
November 1 to 5, which suggested that daytime heating demand would not be
likely in the week-and-a-half to come.  Flow forecasts for Chief Joseph held
steady at 45 kcfs for Saturday, 40 kcfs Sunday, 65 kcfs from Monday through
Thursday, and 60 kcfs on Friday.  No specific unit news was forthcoming,
although aggregate output of northwest hydro units was reportedly down by
over 1400 MW due to curtailed flows.

Golden State electricity prices were mostly flat for the Sunday/Monday
package to Thursday, with off-peak prices edging up on the usual all-day
Sunday premium.  Light load energy costs at SP15 and NP15 climbed 2.1 and
3$/MWh, respectively.  SP15 prices were seen at a slight premium to NP15 in
a light trading session, as many players sat on the sidelines, covering
their loads, but otherwise out of the spot market.  In political news,
California's State Board of Equalization voted to switch tax jurisdiction of
power plants from the local to the state level in 2003.  The state reported
it will tax the plants based on "fair market share", and predicted that more
revenues will be raised under the new system.   Also in the news, California
will not build new transmission lines, used to import power from neighboring
states Nevada and Arizona, until at least 2008.  The generation landscape
was little changed on Friday.  The Shasta hydro units (526 MW) were
completely off-line.  "The reservoirs are probably too low to support any
generation right now," speculated one analyst.  Temperatures in California
were expected to range from the low-70s to low-50s through Tuesday,
producing little weather-related electricity demand in the state.  Keeping
hope for more demand in the near future down, the latest six-to-ten from the
NWS called for normal temperatures from November 1 to 5.

Southwest peak power was a hot commodity in the WSCC on Friday.  Peak goods
for Monday delivery fluctuated between 33 and 36.5$/MWh at Palo Verde, which
boasted a higher volume of trade than its neighboring hubs.  Some players
speculated that the "Palo premium" was based on high natural gas prices that
caused many California gas-fired plants to remain dormant and buy power from
outside the state.  "Without the California-Oregon Intertie, nobody could
access Northwest hydropower, so everybody lined up at Palo Verde and SP-15,"
commented one seasoned marketer.  Temperatures ranged from the high 80s in
Phoenix to the mid-60s in Salt Lake City, with forecasts calling for
temperatures to continue to hover just above normal through Tuesday.  The
latest six-to-ten extended the above-normal forecast through November 5.  On
the generation front, Navajo #1 (750 MW) returned to the grid on Thursday
night as expected after completing water pump repairs.

David Ramberg and Jessie Norris
_________________________________________________________

Western Generating Unit Outages

Current                            Begins          Ends          Reason
CAISO units <250/6308 total          NA             NA
planned/unplanned*
Alamitos #3/320/gas               20-Oct-01         ?            planned
Bridger #2/520/coal               24-Oct-01         ?            unplanned
Bridger #3/520/coal               24-Oct-01      27-Oct-01       tube leak
Comanche #2/335/coal              29-Sep-01      30-Oct-01       maintenance
Contra Costa #7/337/gas           01-Sep-01         ?            planned
El Segundo #3/337/gas             02-Oct-01         ?            unplanned
Etiwanda #3/320/gas               05-Oct-01         ?            unplanned
Helms PGP #2/407/hydro            01-Oct-01         ?            planned
Hyatt/Thermalito/900/hydro        02-Oct-01         ?        @ 250MW,
planned
Los Medanos/550/gas               19-Oct-O1         ?        @ 250MW,
planned
Ormond Beach #2/750/gas           05-Oct-01         ?            unplanned
Palo Verde #2/1270/nuke           10-Oct-01      30 days         maintenance
Palo Verde #3/1270/nuke           29-Sep-01      03-Nov-01
refuel/maint.
Redondo #7/480/gas                23-Oct-01         ?            planned
San Juan #4/534/coal              20-Oct-01      07-Nov-01       maintenance

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

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

October 26, 2001 for October 29, 2001

Peak (Heavy) in $/MWh
                 Low     Change   High      Change
Into Cinergy    31.00     2.50    32.50     -1.45
Western PJM     31.40     1.90    32.90      1.75
Into Entergy    25.55     0.30    29.00      1.00
Into TVA        30.00     0.00    34.50      2.75
___________________________________________________________
In an active Friday trading session, peak power prices for Monday delivery
strengthened across the Eastern Interconnect on cooler weather and
increasing natural gas prices.  "This week the power markets are following
gas up.  Some Hubs, like Entergy, were simply too cheap before, and those
have made particularly strong gains," opined one market analyst.  The
mercury dropped all across the East Friday, and was expected to remain in
the nippy range through Tuesday.  Forecasts were calling for daytime highs
only in the 40s and 50s, and overnight lows in the downright chilly 20s and
30s were expected.  NYMEX Henry Hub gas contracts traded actively on Friday,
a day ahead of expiring November contracts on Monday.   November climbed
10.3 cents to close at 3.041$/mmBtu, and December also edged up 8 cents to
end at 3.183$/mmBtu.

Heavy load energy costs in the Mid-Atlantic rose in Friday trade, amid
higher predicted loads for Monday and strong natural gas markets.
Generation was healthier on Friday, with off-line Megawatts dropping.  Nuke
Indian Point #2 (965 MW) was off-line, entering a 20 day maintenance outage,
and rumors indicated that Peach Bottom #2 (1,152 MW) might have returned to
the grid a day ahead of schedule on Friday.  Western PJM goods were trading
from 31.4 to 32.9$/MWh. With a mean of 22.5$/MWh through 15:00 EDT, LMPs
were very stable on Friday, fluctuating within 4$/MWh of the average all day
after the usual early-morning spike.  Overnight lows in the 30s were
expected through Tuesday of the new week, kicking up heating demand.
Nonetheless, the latest six-to-ten from the NWS called for above-normal
temperatures from November 1 to 5.

Like the rest of the Eastern spot market, peak power prices in the Midwest
were natural gas dependent on Friday. No new outages were reported and gas
costs were expected to outweigh weather-related demand for the new week.
Electricity prices edged down slightly, with Into Cinergy goods changing
hands between 31 and 32.5$/MWh, losing 1.45$/MWh on the high end, but
tightening the range on the low.  The Midwest was expected to be the coldest
region over the weekend and into the new week, with temperatures not
expected to reach any higher than 59 degrees through Tuesday, with overnight
lows in the 20s and 30s.  However, the latest six-to-ten predicted
above-normal temperatures from November 1 to 5.

In the Southeast on Friday trading was particularly active, with heavy load
electricity prices gaining ground yet again, as a brief bout of winter
weather was expected for the new week and strong natural gas costs pushed
prices higher.  Into Entergy pieces traded between 25.55 and 29$/MWh, with
the day's low seen right out of the gate and the high reached late in the
session.  Some market players mentioned that cash gas (inside the month
trades) were really moving the Entergy market on Friday.  Into TVA was a
less liquid market, with deals done between 30 and 34.5$/MWh.  Temperatures
were expected well below normal through Tuesday, with overnight lows solidly
in the 30s.  The weather trend was expected to reverse though, with
above-normal temperatures predicted from November 1 to 5.
___________________________________________________________
California ISO Congestion Index in $/MWh


                         Path                 Peak   Off-peak
for 27-Oct-01         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       34.25    34.75   34.25   34.75   34.75   35.00
November  35.25    35.75   32.75   33.00   34.00   34.50
December  42.50    43.00   36.25   36.75   38.00   38.50
Q1 '02    38.00    39.00   35.00   36.00   37.25   37.75
Q2 '02    28.50    29.50   37.50   38.75   37.00   37.50
Q3 '02    46.00    47.00   55.00   57.00   51.25   52.00
Q4 '02    40.00    41.00   37.25   38.25   40.50   41.25
Cal '03   42.00    42.25   42.00   43.00   43.50   45.00



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  25-Oct-01       62.27      61.90      32.56         53.01    12.45



BPA's Offer in $/MWh

Hours     Amount          NW               COB           NOB


BPA has no offer until further notice.



NYMEX Henry Hub Gas Futures in $/mmBtu

                 Close        Change
        Nov      3.041         0.103
        Dec      3.183         0.080



Natural Gas Spot Prices in $/mmBtu

                  Low          High
Sumas             2.57         2.62
So. Cal Border    2.78         2.83
San Juan          2.51         2.56
__________________________________________________________

Economic Insight, Inc. - 3004 SW First, Portland, Oregon 97201,
Telephone (503) 222-2425, Internet e-mail emr@econ.com -
Copyright, Economic Insight, Inc. 2001.

 - 10.26.01.pdf 
 - EMR Prices.xls 
 - WPU.xls