Likely

Power shortages and price spikes within the PJM Power Pool areas likely this summer as barbecues and sunburns, according to aPennsylvania public interest group.

The rapid transition to a competitive power industry wasresponsible for last summer’s outages and brownouts, and a repeatcould be in store for this year, according to the results of theDepartment of Energy’s (DOE) final report on reliability issues.

The rapid transition to a competitive power industry wasresponsible for last summer’s outages and brownouts, and a repeatcould be in store for this year, according to the results of theDepartment of Energy’s (DOE) final report on reliability issues.

California’s regulatory process for adding merchant power plantsand repowering existing merchant sites is likely to get morecomplicated and time-consuming, based on discussions at a Jan. 25one-day energy roundtable on market and infrastructure issuessponsored by the California Public Utilities Commission in SanDiego.

While El Paso’s new agreement covering 1.2 Bcf/d of its firmtransportation capacity is likely to draw intense public andregulatory scrutiny, it may not be able to overshadow the growingconcern over its capacity allocation procedures. Despite someconcerns that revisiting the issue could undermine the recentlyapproved major settlement, more existing shippers have come forwardclaiming huge losses due to El Paso’s overbooked pipeline.

While El Paso’s new agreement covering 1.2 Bcf/d of its firmtransportation capacity is likely to draw intense public andregulatory scrutiny, it may not be able to overshadow the growingconcern over its capacity allocation procedures. Despite someconcerns that revisiting the issue could undermine the recentlyapproved major settlement, more existing shippers have come forwardclaiming huge losses due to El Paso’s overbooked pipeline.

The 1 Bcf/d Vector Pipeline project continued moving ahead asthe most likely new Midwest pipeline project to break ground andbegin construction. Westcoast Energy decided to grab a 30% equitystake and committed to take 240 MMcf/d of firm capacity in the $500million project. The transaction gives Westcoast a major stake ineach of three new gas pipeline projects that will form a newdelivery corridor to the Midwest, Northeast and eastern Canada fromthe Western Canadian Sedimentary Basin.

Arguments likely raged all day Friday over whether the gasmarket was overreacting to Tropical Storm Bret or not. But as evena member of the “overhyped” camp reluctantly conceded, there was nodenying that cash prices ignored mild northern market-area weatherand the usual drop in weekend load to achieve gains of up to adime. The smallest showings of flat to only about a nickel highercame at western points, which are more insulated from potentiallosses of Gulf of Mexico production.

While the Gas Research Institute maintains the most likelyfuture for natural gas includes low prices and a 31 Tcf market by2015, it is hedging its bets with a new study examining the outcomeif not all the expected pieces fall into place.