Socal

While the initial state regulatory approval is for a long-term power supply contract with an affiliate, Southern California Edison Co. also was authorized last Thursday to eventually own and operate the partially completed Mountainview Power Project near Redlands, CA.

FERC Administrative Law Judge (ALJ) H. Peter Young has ordered several Enron-affiliated wind farm projects and Southern California Edison Co. to file a status report by the end of next week on their efforts to complete a settlement that would resolve assertions made by Edison that the projects failed to comply with the Commission’s regulations for qualifying facility (QF) status.

Elected officials in the fast-growing bedroom community of Corona, CA, voted unanimously late Monday night to pursue a takeover of Southern California Edison Co.’s distribution in its city of 138,000 residents, located 45 miles southeast of Los Angeles in neighboring Riverside County.

As the week of the worst natural gas pipeline disaster in the U.S. drew to a close, with the last of the 12 victims dying on Friday, there was no clear indication when service would resume on any of the three lines making up the El Paso Natural Gas’ South Mainline that feeds 1 Bcf/d into the California market.

Edison International and its financially recovering utility said last week that it expects even more of a heavy infusion of cash, and its hedges against future natural gas price volatility will permit the utility to pay off its $5.5 billion past-due debts by the end of the first quarter next year. A court settlement with state regulators is the lynch-pin that will allow Southern California Edison for the first time in a year to return to the debt market to supplement what it expects to be $4 billion in cash on hand by early next year.

In the absence of a state legislative solution or another negotiated settlement to rescue financially troubled Southern California Edison Co. from bankruptcy, a small Long Beach, CA-based street lighting company is continuing its longshot quest to buy the utility and its parent, Edison International, by establishing a network of cities and townships served by Edison to ensure the deal’s economic and political viability.

With the failure of the state to agree on a rescue plan to restore Southern California Edison’s financial viability, rumors last week grew louder that three of the major generators who are creditors would take the utility into involuntary bankruptcy.

Having lost much of the supporting elements for higher prices from earlier in the week, the cash market yielded to the inevitable Friday with sizeable across-the-board declines. Losses were measured in the teens at nearly all eastern points, while larger drops in the West were topped by dollar-plus plunges at the California border-SoCalGas and OFO-devastated PG&E citygate.

With lack of progress in the FERC settlement talks, state legislative negotiations and among state regulators, all holding the hope for some financial relief, Southern California Edison Co. officials indicated Tuesday that they will continue to resist bankruptcy if state and federally-generated relief falls short, but they will be in a “very difficult” predicament unless some solution comes out of the state legislature by mid-August.