Utility

The leaders of a major pipeline association and a key electricutility group jointly have expressed their support for FERC toconvene a conference “in the near future” to assess post-2000natural gas demand in the Northeast and the need for new pipelinecapacity to serve customers, particularly power generators, in thatmarket. Meanwhile, a new study sees no need for new capacity to theNortheast until 2004 (See related story this issue).

The leaders of the a major pipeline association and a keyelectric utility group jointly have expressed their support forFERC to convene a conference “in the near future” to assesspost-2000 natural gas demand in the Northeast and the need for newpipeline capacity to serve customers, particularly powergenerators, in that market.

Representatives of the major utility industries, natural gas,electricity and telecommunications, met in Houston this week tojointly address Y2K issues. Gary Gardner, chief information officerof the American Gas Association (AGA) cited interlocking activitiesas the basis for the meeting. For instance electricity powers manyof the pipeline compressor stations that keep the natural gasflowing. “Although gas companies have manual overrides that can beused in the event of an electrical power shortage or outage, fieldpersonnel posted at the compressor stations will rely ontelecommunications devices to communicate with their headquarters.

Increasing competitive pressure inside traditional monopolyutility market territories has triggered somewhat of a revival ofinvestment diversification by gas and electric utilities. But theseinvestments are not what they’re cracked up to be, according toenergy consulting firm Metzler Services, a subsidiary of Metzler&amp Associates. Non-core investments, including internationalventures, did not payoff over the year ended last September,Metzler calculated in its third quarter Flashreport, released lastweek.

Mexico’s Energy Regulatory Commission (CRE) issued the Queretarogas distribution permit to Belgian electric utility Tractebel.Tractebel was awarded the permit as a result of the bid processundertaken by the CRE for the geographic zone, which comprises themetropolitan area of Queretaro, as well as the city of San Juan delRio.

The California Public Utility Commission yesterday decided toleave Southern California Gas Co.’s interstate transportation ratesbundled, determining that a state law passed last summer preventsthe commission from taking any action on gas industry restructuringissues until the year 2000.

A new battle in utility deregulation gained momentum last weekwhen the Electric Power Supply Association (EPSA) published aletter urging the Florida Public Service Commission (FPSC) toreject Florida Power Corp.’s petition to forgo competitive biddingfor construction of Hines 2, a second gas-fired generation plant atits Hines Energy Complex in Polk County, FL.

The New England electric market is getting crowded, so crowdedthat a Florida-based utility poised to move into that market now istrying to get out of an $846 million deal to purchase Mainegenerating assets.

New Jersey utility holding company GPU Inc. has sold itsnon-nuclear generating assets for $2.62 billion – 2.5 times bookvalue or $510 per kilowatt. The majority of generating assets werebought by French- and Japanese-owned Sithe Energies Inc. of NewYork City, which bought assets in New Jersey, Pennsylvania andMaryland. The deal will make Sithe the largest U.S. independentpower producer.