![](media/image1.jpeg){width="8.5in" height="3.5027777777777778in"}U.S.
DEPARTMENT OF ENERGY

**Office of Energy Assurance**

**ENERGY ASSURANCE DAILY**

###### July 19, 2004

**Electricity**

**SCE\'s Nev. Mohave 2 Power Plant Shut Again**\
Southern California Edison Co.\'s 790-megawatt Mohave 2 coal-fired power
plant in Nevada shut over the weekend, according to the California
Independent System Operator\'s plant outage report on Sunday. The
California ISO said the outage was unplanned. On Friday, the unit exited
an outage that began on July 4. There are two 790-MW coal-fired units (1
and 2) at Mohave, which is in Clark County, near Las Vegas.
<http://biz.yahoo.com/rc/040719/utilities_edisoninternational_mohave_1.html>

**High Demand for Power in California** Loads in California are holding
at fairly strong levels today. The California Independent System
Operator forecast a peak load of 43,189 megawatts on Monday, falling
only marginally to 42,946 MW on Tuesday. The California ISO issued a
notice asking for generators to restrict maintenance operations on
Monday, citing expected high temperatures and loads. Reuters, 1405 July
19, 2004

**Clinton IL Nuke Exits Outage, NRC Inspects**\
The U.S. Nuclear Regulatory Commission said it began a special
inspection into the July 13 reactor shutdown at AmerGen Energy Co.\'s
Clinton nuclear power plant in Illinois. After remaining shut for most
of last week, the plant exited the outage over the weekend and was
operating at 27 percent of capacity by early Monday, the NRC said. The
plant was up to 40% power by early afternoon.
<http://biz.yahoo.com/rc/040719/utilities_exelon_clinton_2.html>
Bloomberg News, 1309 July 19, 2004

**APS\'s Arizona Palo Verde 2 nuke back at full power**\
Arizona Public Service\'s 1,335-megawatt Palo Verde 2 nuclear unit in
Arizona exited an outage and ramped up to full power by early Monday,
the Nuclear Regulatory Commission said in its power reactor status
report. The unit had been shut since about July 14.
<http://biz.yahoo.com/rc/040719/utilities_pinnaclewest_paloverde_1.html>

**HVDC From Alberta to L.A.?**

One of the largest cogeneration opportunities in the world sits in the
oil sands of Alberta, estimated to grow to about 6,500 MW of capacity by
2010, from about 1,300 MW today. But with the local electricity market
currently oversupplied, the focus is on finding a way to ship much of
the power south. Energy Prospects, July 19, 2004.
<http://pro.energycentral.com/professional/news/power/news_article.cfm?id=4994135>

#### Improvements Make Repeat of Last Year's Ohio Blackout Unlikely, Regulators

Chain saws have toppled overgrown trees under thousands of miles of
electric transmission lines. Computerized monitoring systems are
upgraded. People who operate utility control rooms are better trained.
Those improvements and others to the electric grid since the historic
Aug. 14 blackout make a repeat of that unlikely this summer, utility
representatives, regulators and others testified Thursday in Cleveland.
Congress needs to enact stalled energy legislation now, said Ohio Gov.
Bob Taft and others. The federal government needs to put into law
mandatory electric reliability standards that include stiff penalties
for noncompliance, they said. \"In my view, it\'s inexcusable\" that
Congress has not acted, Taft said. A comprehensive energy bill has been
held up for more than a year. \"It\'s been stalled because of other
issues, peripheral issues,\" Taft said.

<http://www.energycentral.com/centers/news/daily/article.cfm?aid=4991196>

**Utility Concerns Over Security and Transmission** The biggest area of
concern for power utilities over the next five years is security of
supply and increasing transmission capacity, according to a new report.
In PricewaterhouseCoopers\' sixth annual survey of around 150 utilities
worldwide, utilities ranked security and transmission above increased
regulation, price volatility and renewable energy policies. Previously
it had been the fourth most important concern. The report said the
change was a \"direct result of increasing difficulties in the balancing
act of power generation, demand and transmission\". It said major
blackouts in the US, Sweden, Italy and the UK, and continued corporate
failures had \"sent shockwaves through the industry\". The report said
the power cuts had acted as a wake-up call for the sector and investment
in new transmission and generation capacity was required. However it
revealed \"a huge lack of faith\" from utilities that governments would
provide the support required for expansion. The report revealed that
some utilities were ill-prepared to deal with climate change and
emissions reduction. Just 43 per cent of respondents had a fully or
partly operational strategy to deal with the new risks inherent in an
environment of emissions trading. Around 26 per cent had no strategy,
even in planning. Meanwhile regulatory certainty was an important
concern of utilities. Inconsistencies and political changes in
regulation were a concern, but the most important issue in many areas
was the lack of progress in deregulating power industries, and an
inconsistent approach.
<http://www.energycentral.com/centers/news/daily/article.cfm?aid=4994133>

**Power-grid operator gets approval for \$87 million in upgrades**

The operator of the power grid that serves Maryland and seven other
states said yesterday it has given the go-ahead for \$87 million in
upgrades to the electric transmission system to ensure reliable electric
service for the region\'s 35 million customers. PJM Interconnection, an
independent system operator that monitors high voltage transmission
lines in the region, said it approved the upgrades \-- to be made either
by utilities or power plant developers \-- as part of a continuing
process to improve the grid. PJM oversees the system in all or parts of
Maryland, Delaware, Illinois, New Jersey, Ohio, Pennsylvania, Virginia,
West Virginia and Washington D.C. Part of the \$87 million will pay to
connect 26 generation projects to the grid, adding 1,100 megawatts of
new generation capacity \-- enough to power nearly one million homes.
Baltimore Gas and Electric Co., the utility serving the Baltimore area,
is planning projects to enhance reliability of downtown Baltimore\'s
electric supply and to accommodate future growth, Robert W. Gould, a BGE
spokesman, said yesterday. But it is unclear exactly which or how much
of those projects are included in the upgrades announced by PJM.

The Baltimore Sun, July 16, 2004
<http://www.energycentral.com/centers/news/daily/article.cfm?aid=4991279>

**Ontario Power Generation\'s Pickering No. 6 Nuke Shut Late Friday.**

The unit was operating near full power early Friday. Officials at OPG
said they did not expect the outage to last long but could not for
competitive reasons discuss when the unit would return. Traders said
unit 6 and the nearby unit 8 would both likely return to service by the
end of the week. Unit 8 had been shut since late March for planned
long-term maintenance.

Reuters, 1405 July 19, 2004

**Petroleum**

**Canadian Oil Sands Project Back Up After Repairs**\
Canada\'s newest oil sands mining project was back in full operation on
Monday more than two weeks after one of its production trains suffered
mechanical Train 2 at the 155,000 barrel a day Athabasca Oil Sands
Project in northern Alberta was shut down at the beginning of the month
due to problems with a settling tank in the plant that extracts the
thick crude from the oil sands.
<http://biz.yahoo.com/rc/040719/energy_oilsands_athabasca_1.html>

**BP Plans Texas City Hydrogen Unit Shutdown** BP plans to shut hydrogen
unit No. 2 at its 470,000 barrel per day (bpd) refinery in Texas City,
Texas, on Saturday, according to a filing with the Texas Commission on
Environmental Quality. Since early June, two other hydrogen units at the
refinery, the third-largest in the United States, have been shut for
maintenance, according to filings with the Texas Commission. Each of the
shutdowns has lasted about two weeks. A hydrogen unit produces
additional hydrogen which is used to reduce sulphur content in gasoline,
diesel and jet fuel.
<http://biz.yahoo.com/rc/040719/energy_bp_texascity_2.html>

**Oil at 6-Week High as Larger OPEC Quota May Not Boost Supplies** Oil
prices rose to the highest in six weeks amid speculation that an
increase in quotas by the Organization of Petroleum Exporting Countries
won\'t boost actual supplies. OPEC pledged last week to proceed with a
planned 500,000 barrel-a-day increase in targets on Aug. 1 and canceled
a meeting scheduled for Wednesday. Most OPEC members are pumping almost
all the oil they can as the world economy expands, boosting demand.
Bloomberg News, 1531 July 19, 2004

**NCRA Refinery Receives New Unicracker**\
By receiving a new unicracker, the National Cooperative Refinery
Association\'s 85,000 b/d refinery in McPherson, Kan., in on track to
put its fuels in compliance with clean-fuel regulations. OPIS Price
Watch Alert, 1324, July 19, 20094

# Natural Gas

**Year Delay Sought for Related Islander East, Algonquin Projects**\
Islander East Pipeline Co. LLC and Algonquin Gas Transmission Co. have
asked FERC for a one-year extension to complete construction of their
companion pipeline projects in light of the hurdles that Islander East
has faced in obtaining state permits for its Connecticut-to-Long Island
natural gas line.
[http://powermarketers.netcontentinc.net/newsreader.asp?ppa=8kowu%5DZjjjoqoqYTkh%7DGJ%7Bbfej%5B%21](http://powermarketers.netcontentinc.net/newsreader.asp?ppa=8kowu%5DZjjjoqoqYTkh}GJ{bfej%5B!)

[**LNG Terminal Cluster Could Make Supply Too Vulnerable to
Storms**](http://www.energyintel.com/DocumentDetail.asp?document_id=126167)\
Analysts believe few, if any, liquefied natural gas (LNG) receiving
terminals will be approved or built on either the East of West coasts of
the US. The majority of the new facilities will more than likely be
clustered along the Gulf Coast. Natural Gas Week, July 19, 2004

**Other**

**Terrorism Fears Thwart Journalists\' Reporting** A federal rule aimed
at keeping terrorists from learning about vulnerabilities in the
nation\'s energy infrastructure might be resulting in the neglected
safety of dams and pipelines and in less monitoring of an electric grid
whose operators are unaccountable for its reliability-all of which will
spare powerful, politically appointed regulators embarrassment. The
reason: This rule-prompted by worries about homeland security-blocks
journalists from reporting certain information about pipelines,
transmission lines, hydroelectric dams, and other energy facilities. The
Federal Energy Regulatory Commission (FERC) has jurisdiction over dams
and hydropower, oil and gas pipelines, electric power plants and the
grid connecting them, and many other aspects of the nation\'s energy
infrastructure. For years it had issued licenses and enforced
regulations in formal, quasi-judicial proceedings. As part of these
proceedings, documents were filed in a public docket, and everything was
supposed to be on the record. Within a month after the September llth
attacks, FERC started to remove previously public information from its
Web site. By January 2002, it began regulatory proceedings to excise
entirely from the public record a whole class of information it called
\"Critical Energy Infrastructure Information\" (CEII). On February 20,
2003, the CEII rule was finalized, and it defined CEII as information
about \"proposed or existing\" critical energy infrastructure that
\"could be useful to a person in planning an attack on critical
infrastructure.\" In response to protests from open-government groups,
FERC amended its definition to include only information already \"exempt
from mandatory disclosure under the Freedom of Information Act (FOIA)\"
and that \"does not simply give the location of the critical
infrastructure.\" The final rule also allowed companies and utilities to
claim protection for disclosure of information when they initially
submit it to FERC. Such information would then remain undisclosed unless
FERC\'s CEII coordinator decides otherwise. The rule applies not merely
to information about existing facilities, but to proposed facilities
that might be built if FERC licenses them. FERC\'s system departs from
FOIA in several important ways. First, it allows companies to shift the
presumption to nondisclosure. second, it requires that anyone requesting
information prove their identity and \"need to know.\" Third, people
receiving CEII must sign nondisclosure agreements-a provision that
reporters would balk at. Nieman Reports, July 17, 2004.
<http://www.energycentral.com/centers/news/daily/article.cfm?aid=4994084>

**Energy Prices**

+-------------------------------+-----------+-----------+------------+
|                               | **Latest  | **Week    | **Year     |
|                               | (7        | Ago**     | Ago**      |
|                               | /19/04)** |           |            |
+-------------------------------+-----------+-----------+------------+
| **CRUDE OIL**                 | 41.55     | 39.39     | 31.96      |
|                               |           |           |            |
| **West Texas Intermediate     |           |           |            |
| US**                          |           |           |            |
|                               |           |           |            |
| \$/Barrel                     |           |           |            |
+-------------------------------+-----------+-----------+------------+
| **NATURAL GAS**               | 5.75      | 5.95      | 5.01       |
|                               |           |           |            |
| **Henry Hub**                 |           |           |            |
|                               |           |           |            |
| \$/Million Btu                |           |           |            |
+-------------------------------+-----------+-----------+------------+

> Source: Reuters

**This Week in Petroleum** from the Energy Information Administration
(EIA)

[*http://tonto.eia.doe.gov/oog/info/twip/twip.asp*](http://tonto.eia.doe.gov/oog/info/twip/twip.asp)

Updated on Wednesdays

**Weekly Petroleum Status Report** from EIA**\
**[*http://www.eia.doe.gov/oil_gas/petroleum/data_publications/weekly_petroleum_status_report/wpsr.html*](http://www.eia.doe.gov/oil_gas/petroleum/data_publications/weekly_petroleum_status_report/wpsr.html)

Updated after 1:00pm (Eastern time) on Wednesdays

**Natural Gas Weekly Update** from EIA

[*http://tonto.eia.doe.gov/oog/info/ngw/ngupdate.asp*](http://tonto.eia.doe.gov/oog/info/ngw/ngupdate.asp)

Updated after 2:00 pm (Eastern time) on Thursdays