Mergers and acquisitions
Equity, EDN merge: Equity Electrical Associates Inc. (Equity), a nationwide group of independent electrical distributors, and Electrical Distributors Network Inc. (EDN), an established electrical distributor marketing group, have merged, forming a $6 billion network. The two entities will remain as separate operating divisions, maintaining existing company names, personnel, boards of directors, earning schedules and payment procedures. The new parent company will be called Power Marketing Management LLC with Richard Noel of Equity as board chairman and Matthew Roos of EDN as president and CEO.
First Source to sell retail business: First Source Energy Corp. has reached agreement with the Ontario Energy Savings Corp., a subsidiary of Energy Savings Income Fund, to sell its retail electricity business interests, involving the transfer of over 8,200 accounts and 150 MW. This transaction will add to the 690,000 Ontario residential customer equivalents that have already contracted with Ontario Energy Savings Corp. for long-term electricity and natural gas services.
DEFS sells assets: Duke Energy Field Services (DEFS) will sell one package of assets in Mississippi, Texas, Alabama and Louisiana to Crosstex Energy Services LLP and a second package of assets in eastern Oklahoma to ScissorTail Energy LLC. Crosstex will get the AIM pipeline system, among other gas assets. ScissorTail will receive various gas processing plants and approximately 2,800 miles of gathering pipeline.
Projects and contracts
SDG&E seeks bids: San Diego Gas & Electric (SDG&E) has issued a request for proposal (RFP) for bids to meet area needs starting in 2005. Suppliers have the option of bidding to supply their resources by the summer of 2005, 2006 or 2007. All sources must originate from within SDG&E’s service territory or must directly connect to SDG&E’s grid.
Green Mountain expands into Texas: Green Mountain Energy Co. is expanding its operations into Texas’ commercial and industrial market. To launch the new offer, the company announced that it has signed up three Whole Earth Provision stores in Dallas and Houston.
Hydro-Quebec is looking for power: Hydro-Quebec Distribution, the Hydro-Quebec division responsible for serving the local load in Quebec, is launching a call for tenders to meet the long-term electricity needs of its customer base. The call for tenders is for 1,000 MW of electricity generated by wind turbines. Deliveries may start between Dec. 1, 2006 and Dec. 1, 2012. The deadline for the submission of bids is June, 2004.
PPL signs agreements: PPL EnergyPlus LLC has signed an agreement with Arizona Public Service to provide 112 MW of electricity from July through September of 2003 and 150 MW from June through September of 2004 and 2005. In addition, PPL EnergyPlus has signed agreements with Tucson Electric Power amounting to 37 MW of electricity from June through December 2003 and 75 MW from January 2004 through December 2006.
Calpine sells to Brazos: Calpine Corp. has signed a two-year agreement to provide up to 300 MW of power to Brazos Electric Power Coop Inc. in Texas. Power deliveries will begin during the first quarter of 2004.
Allegheny Energy renegotiates: Allegheny Energy Inc. has renegotiated the terms and conditions of its energy supply contract with the California Dept. of Water Resources. Under the original terms of the contract, Allegheny was to provide up to 1,000 MW at a flat rate of $61 per MWh through 2011. Under the renegotiated contract, Allegheny will reduce the volume of electricity supplied for the remainder of the contract and will reduce the price for off-peak hours beginning in 2004. The average price for electricity under the renegotiated contract is $59.83 per MWh.
Legal and regulatory
Agreement reached in Nevada: Electric ratepayers served by Sierra Pacific Power Company in northern Nevada will realize a rate decrease of $9.8 million this year and a rate decrease of $19.8 million beginning June 1, 2004—-subject to approval by the Public Utilities Commission of Nevada. The impact to a typical Sierra Pacific single-family residential customer utilizing 675 kWh will be about $0.82 per month the first year.
FERC orders NRG to keep the power on: The Federal Energy Regulatory Commission (FERC) has denied NRG Power Marketing’s request to cancel a wholesale power contract it had with Connecticut Light and Power Co. (CL&P), at least until the commission has a chance to look at the dispute in more detail. Under the terms of an existing contract, NRG provides 45 percent of CL&P’s retail electric load. NRG’s dispute with the contract centers around congestion costs, which the company says it is not responsible for paying.
UI will not get recovery: Connecticut’s Dept. of Public Utility Control has denied The United Illuminating Co.’s request for recovery of $15.5 million in increased pension and post-retirement expenses. The department stated in its draft decision that “the company’s current earning of its allowed rate of return on equity prohibits any ratemaking treatment at this time as a matter of law.”