Soon

The Midwest utility landscape should expect radical changessoon, as two major mergers have cleared all regulatory approvalsand are closing in on completion.

A new pipeline may be needed in Southern California to eliminateimpending gas supply and infrastructure constraints, which couldbecome critical in the next few years, according to participants ata one-day roundtable last week in San Diego. Demand is expected tofar exceed supply in the burgeoning southern end of California andon both sides of the U.S.-Mexican border, where population,industrial and energy growth are surpassing expectations.

Gas and electricity customers in Pennsylvania and New Jersey -previously served by Florida-based FPL Energy Services – soon willbecome customers of PP&L Energy Plus. PP&L EnergyPlus Co.,the retail marketing arm of PP&L Resources Inc., agreed toserve the customers after FPL Energy Services decided to exit thecompetitive energy markets in the Northeast. Terms of thetransaction were not disclosed.

Customers of Enron soon will be able to point and click a mouseto buy gas, electricity and eventually every product the companytrades with the launch of EnronOnline, a global Internet-basedtransaction system for wholesale energy and othercommodities.EnronOnline will allow participants to not only viewcommodity prices in real-time but also to directly transact withEnron over the Internet free of commission. The transaction systemwill go live Nov. 29 with the launch of North America natural gasto be followed by all other products over the next six weeks.

Markets in Atlantic Canada and New England won’t be getting anextra gas supply source as soon as previously expected. Maritimes& Northeast Pipeline LLC informed FERC this week that both530/360 MMcf/d Canadian/US pipeline project (Phase II) and theSable Offshore Energy Project (SOEP), which will be the source ofsupply for the pipeline, will not be in service on schedule.

Markets in Atlantic Canada and New England won’t be getting anextra gas supply source as soon as previously expected. Maritimes& Northeast Pipeline LLC informed FERC this week that both530/360 MMcf/d Canadian/US pipeline project (Phase II) and theSable Offshore Energy Project (SOEP), which will be the source ofsupply for the pipeline, will not be in service on schedule.

El Paso Natural Gas last week said it awarded only a smallfraction of the 1.35 BBtu/d of soon-to-be available firm capacityon its system to one shipper — Williams Energy Marketing andTrading — following its recent open season. “There were no bigwinners,” noted El Paso President Richard Baish. The pipelinerejected the majority of shipper bids because they failed to meetthe “minimum revenue threshold” requirements for the capacity.

El Paso Natural Gas announced yesterday that it awarded only asmall portion of the 1.4 Bcf/d of soon-to-be available capacity onits system to one shipper – Williams Energy Marketing and Trading.The pipeline rejected the majority of shipper bids because theyfailed to either meet or exceed the “minimum revenue threshold”requirements for the capacity.

Industry executives who were expecting FERC to act soon on majorpolicy initiatives addressing second generation Order 636 issueswill be sorely disappointed. Commissioner Linda Breathitt saidyesterday she didn’t expect to see any action on the notice ofproposed rulemaking (NOPR) and notice of inquiry (NOI) for possiblyanother six months.