How the energy wholesale marketplace sorts itself out in the wake of the past year’s stream of bad news remains to be seen, but regardless, there is a “tremendous” need to market the natural gas of producers, and the growing, underserved wholesale market presents a myriad of opportunities, energy executives believe.
At Thursday’s CERAWeek 2003 in Houston, James Rogers, Cinergy Corp.’s CEO, said the marketplace with be “living” with the Enron Corp. debacle a long time. However, he reminded his audience that the problems were “not just Enron. It was the most publicized, but it was not the only story.” Rogers said that it is an “issue of trust” that has to be regained by participants. And rebuilding that trust will take time.
Rogers said as companies plan for the future, they should “err on the side of a great portfolio. They have to have a mix of assets…that’s what they should strive for in this country.” Cinergy, headquartered in Cincinnati and centered in the Midwest, holds a variety of assets, including coal plants and natural gas-fired plants. With that type of diversity, volatility in the marketplace matters less, he said.
However, Rogers said that future infrastructure investment will be a touchy issue for a long time to come. “The notion that building power plants without a customer base” is a thing of the past. “Banks won’t loan” under those types of criteria any longer.
Lawrence Makovich, senior director of Cambridge Energy Research Associates Global Gas and Power unit, said that U.S. utilities were “still on a learning curve here. There is no national exuberance, but it won’t be as bad the next time.” He said that the “chronic uncertainty” has been “driven home in the power business, which now understands that diversity is important.” He also agreed that agreed with Rogers about the issue of trust, noting that it will take a “long, steady period” before investors return to the sector.
Â©Copyright 2003 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.
© 2022 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |