Spikes

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

Looking ahead to summer within the PJM Power Pool meansanticipating power shortages and price spikes. With virtually nonew generation coming on line for this summer, Pennsylvania publicinterest group PennFuture says it’s time to create a demand sidemarket for electricity and give consumers an incentive to conserve.

In the wake of the price spikes in heating oil, CommissionerCurt Hebert Jr. yesterday called on his FERC colleagues tocertificate the Northeast-bound gas pipeline projects that havebeen stalled at the Commission to reduce the region’s historicdependence on the higher priced heating fuel.

It was time to get out the smelling salts again Tuesday torevive traders swooning from the altitude of Northeast citygates.Quote averages zoomed higher by more than $2 at a few points, andone source reported hearing that intra-day numbers for deliveriesinto the Boston area via Tennessee and Algonquin peaked at $10.

After power price spikes, contract defaults and costly supplydeals cost Cinergy $73 million in July, the company said it wasseriously considering quiting the supply business altogether. (SeeDaily GPI, Aug. 9, Aug. 11, and Aug.13) But CEO James E. Rogerssaid yesterday the company’s board of directors has unanimouslydecided Cinergy should stick with it as the industry moves to acompetitive environment.

In an effort to improve its power market monitoring capabilitiesin light of the price spikes and market disruptions that occurredlast summer, FERC last week changed the reporting requirements forthe 500-600 licensed power marketers.

In an effort to improve its power market monitoring capabilitiesin light of the price spikes and market disruptions that occurredlast summer, FERC yesterday changed the reporting requirements for600 power marketers. The Commission said it intends to remove awaiver of its rules that was granted to power marketers and powerproducers with market-based rates that allowed them to refrain fromfiling their long-term contracts with their customers. The changeputs power marketers on a more level playing field with traditionalutilities, which currently have to file their long-term agreements.

Trading in El Paso Energy stock was nearly triple normalactivity Friday, thanks to a rumor the company was acquiring SonatInc. Sonat share trading was more than five times the usual volumeas well. Friday El Paso closed down 2 15/16 at 35 _. Sonat closedup 3 1/16 at 30 3/16. El Paso’s 52-week range is 24 11/16 to 393/8, and Sonat’s 52-week range is 23 9/16 to 45.

Summer power price spikes may have hardly triggered a blip onthe gas spot market last year, but that may not be the case in thenear future. With the expected tremendous growth in gas-fired powergeneration, gas prices are on track to be more closely linked withthe price of electricity than the price of oil, according toCoastal Corp. CEO David A. Arledge.