2002 Will Be a Pivotal Year
While 2001 can be characterized by uncertainty, by the end of 2002, we should know a lot more about what power markets are likely to look like over the next five to 10 years.
Overbuilding? Fuhgeddaboutit!
Taking a different view on merchant development.
A response to the recent article “Power Shortages? Fuhgeddaboutit!” by Betsy S. Vaninetti.
FERC's California Caps: Just Smoke and Mirrors?
Industry experts debate whether so-called “price mitigation measures” miraculously solved the California crisis.
Wholesale electricity prices are lower in California than they were last May, before FERC implemented price caps. But there is widespread disagreement over whether the caps were the cause of the lower prices, or merely coincidental with other downward pressures.
Electricity: It's a Scream
Hollywood animators take a jab at the energy crisis.
Their lights don’t run on electricity or natural gas—that would be too easy. In Monstropolis, the lights are powered by the screams of little children.
Energy Trading & Marketing: The Evolution of the Deal
Energy traders and risk managers reengineered their business dealings to manage against unexpected political and financial risks posed by California and Enron in 2001.
The rules of energy market survival changed forever in 2001. California and Enron were both humbled by gyrating prices and blackouts in the Golden State, and financial misadventure dethroned the once-crowned king of energy trading. These twin events sent shockwaves through the very foundation of the energy trading and risk management establishment.
Gas Marketers: Oblivious to All the Fuss
New mega-marketers, niche players emphasize opportunity.
Even when the calendar flipped to 2001 and much of the energy industry was swept into the turmoil surrounding the California electric industry restructuring fiasco, gas marketers continued to thrive in the low-supply, high-demand environment.
Making Markets Work: How ISO Rules Still Cause Problems
How obscured spot prices, unhedgeable basis differentials, unreliable and financially insecure clearing practices inhibit market liquidity.
To date there has been little clarity as to how the physical and financial markets would work together to eliminate the need for continued price regulation, as FERC has proposed.
Credit Risk Exposure
Will traders finally wake up to the danger?
The urgency passed with the heat wave. During the California crisis and defaults of 2001, credit risk rose to prominence again, only to be forgotten after the California markets cooled off.
A Wrinkle in Time
Enron makes an exit; FERC cost-based rates return.
You have two cows. You sell three of them to your publicly listed company using letters of credit opened by your brother-in-law at the bank. Then, you execute a debt-equity swap with an associated general offer, so you get all four cows back, with a tax-exemption for the fifth cow, of course.
People (Jan 1, 2002)
El Paso Corp. announced that Britton White Jr. has retired as executive vice president and general counsel. He was appointed to this position after El Paso acquired Tenneco Energy in 1996. Peggy A. Heeg has been named as his replacement. Heeg previously served as senior vice president and deputy general counsel. She joined Tenneco Energy in 1990 and became vice president and associate general counsel for regulated pipelines for El Paso after the merger. El Paso also announced the retirement of David A. Arledge from its board of directors.