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AES Says Williams Deal Is Just a Start

AES Says Williams Deal Is Just a Start

Following their recent plunge into California electricity competition, the world's largest independent power producer, Arlington, VA-based AES Corp., is combing the nation looking to structure similar deals with a large natural gas/power marketer, such as Williams Energy Services, according to a California-based AES executive who operates throughout most of North America.

The deal AES signed with Williams to manage the input fuel and output power from the Southern California Edison plants AES purchased is a multi-year gas supply and power marketing contract worth millions of dollars. Gas supplies, alone will average about 600 MMcf/d with peaks near 1 Bcf/d. Williams also will market all of the power output from the three southern California coastal plants. The plants have a combined peak capacity of 3,956 MW.

AES's Glen Davis, a vice president overseeing various domestic projects, confirmed the company is looking at the hydroelectric and fossil plants Pacific Gas and Electric Co. and San Diego Gas and Electric Co. will be selling plants later this year.

"We're looking at them, but we haven't made any definitive decisions to bid on any one set of assets," Davis said. "Until we actually get to the point of deciding whether we can be competitive, it is hard to say whether or not we will make other bids.

"We don't really limit ourselves to one fuel or technology," he said, adding that AES has no nuclear, however. It owns existing hydro generation in South America and is developing new hydro in Africa.

Longer term, he said, AES will be "exploring ways to modify the [Edison] plants, whether that means adding capacity or improving efficiency, but nothing is cast in stone right now." Richard Nemec, Los Angeles

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