Edge

This week is crunch time for the California legislature and the fate of Southern California Edison Co. as it sits on the edge of being dragged into bankruptcy. Facing a summer recess starting this Friday, state lawmakers were exploring alternatives to the April 9 deal between the governor and Edison that calls for the sale of the utility’s transmission assets to the state.

This week is crunch time for the California legislature and the fate of Southern California Edison Co. as it sits on the edge of being dragged into bankruptcy. Facing a summer recess beginning this Friday, state lawmakers were exploring alternatives to the April 9 deal the governor and Edison struck that involves the sale of the utility’s transmission assets to the state.

Pennsylvania faces the very real threat of being dethroned as the nation’s leading model for electricity choice because skyrocketing wholesale power prices are pushing state customers to abandon electric choice in favor of default providers, according to the Center for the Advancement of Energy Markets. As Pennsylvania stumbles on the road to electric deregulation, Texas, Maine and New York are all making impressive strides in promoting sustainable competition among electricity providers, the center said.

Backers of the Elk Hills Power Plant in the western edge of the San Joaquin Valley’s oil patch held groundbreaking ceremonies Monday –on a 570-MW gas-fired plant in the midst of plentiful local gas supplies. The plant’s sponsors are Occidental Petroleum (Oxy), which owns the nearby Elk Hills oil/gas production fields once a part of the U.S. Navy’s Strategic Reserves, and Sempra Energy. The new plant will get all of its fuel supplies — up to 94 MMcf/d — from nearby Elk Hills, delivered through an Oxy pipeline, eliminating the normal utility transportation charges.

Except for California softness, prices managed to edgemoderately higher Monday in the face of light weather-relateddemand and only a modicum of screen support. Unless they werelooking ahead to below normal temperatures forecast next week forthe eastern half of the U.S. by the National Weather Service,sources essentially had nothing concrete to which they could pointin explaining the upticks that continued Friday’s mini-rally.

While California state lawmakers finally rushed to deal with theshort-term power supply crisis on Friday, the financial conditionof Southern California Edison (SCE) and Pacific Gas & Electricmoved closer to the terminal stage. So far the measures passedappear inadequate to cure the utilities’ financial woes, accordingto many observers. Unless creditors see some ray of hope incontinuing legislative action they soon could force the utilitiesinto bankruptcy.

The softening that had begun in late trading Monday carried overto Tuesday’s activity, but the path back down wasn’t as steep asthe climb up.

The first-ever broad-based study analyzing finding anddevelopment (F&D) costs by strategy area and cost componentsfor companies operating in the Shelf and Slope areas of the Gulf ofMexico shows that technology plays a key role in determiningcompetitive advantage. Ziff Energy Group, which released the studythis week at the Offshore Technology Conference in Houston,analyzed activity on the Shelf and Slope to 1,500-feet water depth.

By the close of trading last Friday, Columbia Energy Group’s$6.7 billion unsolicited bid for Consolidated Natural Gas still hadthe edge on Dominion Resources’ all stock offer worth $5.9 billion,but Dominion’s stock price was gaining ground.