July

In an effort to ease the pain of deregulation for residentialconsumers, the Georgia Public Service Commission (GPSC) voted 5-0last week to approve an estimated $40 million residential refundplan that would help ease what are sure to be high gas bills thiscoming winter. The commission also voted to approve a newsculptured tariff for distribution charges instead of the currentflat rate by a vote of four-to-one, with Commissioner Robert Bakerdissenting.

After putting in a price bottom at the end of July, natural gasfutures have moved steadily higher throughout the month of Augustas traders priced a hurricane premium into the market. Theirconcern is that a supply disruption in a market that already sportsa tight supply-demand equilibrium could mean serious problemsheading into the crucial winter demand months.

The sponsors of Independence Pipeline and the associatedSupplyLink expansion project informed FERC on Friday that theyaccepted the mid-July decision awarding them certificates toconstruct their controversial Midwest-to-East Coast pipelineproject. The order is still subject to rehearing at the Commissionand then possibly to a court review. Combined, the two projects —SupplyLink, an upstream expansion of sponsor ANR Pipeline’sexisting system; and Independence, a 400-mile greenfield pipelinefrom Defiance, OH, to the Leidy Hub — would add about 1 Bcf/d ofwest-to-east firm transportation capacity at $803 million, servingthe growing gas needs of power generators in the east andNortheast. Partners in Independence are ANR, Williams’Transcontinental Gas Pipeline and National Fuel Gas Co.Independence and SupplyLink projects are targeted for in-service inNovember 2002.

There are still no takers in a plan to unbundle Colorado’s gas utilities, but at least two utilities may be warming to the idea. A meeting in mid-July of the Colorado Public Utilities Commission (PUC) to discuss natural gas local distribution company unbundling, gas utility plans and consumer issues concluded with only two companies — the largest ones serving the state — reporting that they might provide unbundling programs. Just not now.

After defaulting on multiple contracts last July during a periodof extreme power prices and taking huge losses to make up for theproblem, Cinergy considered getting out of trading entirely.However, it ended up scaling back its national operations to aregional focus and it brought in a large new team of moreexperienced players.

After defaulting on multiple contracts last July during a periodof extreme power prices and taking huge losses to make up for theproblem, Cinergy considered getting out of trading entirely.However, it ended up scaling back its national operations to aregional focus and it brought in a large new team of moreexperienced players.

As sources had predicted (see Daily GPI, July 14), the weekendmarket was divided along geographical lines. Eastern quotes were upby around a nickel to a little more than a dime in most cases,while the majority of western points registered declines rangingfrom slightly less than a dime to 20 cents or more.

El Paso’s delivery meter to Transwestern at the Window RockStation (Apache County, AZ) will be shut in July 24-25 forequipment upgrade

The Maryland Public Service Commission (PSC) has given a greenlight to the July 1 transfer of 1,300 MW of Allegheny Energy Inc.’sPotomac Edison generating assets to its non-regulated energy supplyaffiliate. The transfer of the generating assets to AlleghenyEnergy Supply Co. LLC will give it more than 5,400 MW of low-costgenerating capacity to sell in the deregulated marketplace.