![](media/image1.jpeg){width="8.75in" height="3.6055555555555556in"}U.S.
DEPARTMENT OF ENERGY

**Office of Energy Assurance**

**ENERGY ASSURANCE DAILY**

###### May 10, 2004

**Electricity**

**PacifiCorp's Wyodak in WECC tripped early Sunday**

The plant is running near 140 MW early Monday. Genscape Weekend Update,
May 10, 2004.

**Clinton 1 Operating at 50% Following Maintenance, Company Says**

AmerGen's 930 MW Clinton 1 nuclear unit reduced power following
maintenance on a feed water pump.

Bloomberg News, 1316 May 10, 2004

**Dresden 3 Nuke Restarts Following Maintenance, Company Says**

Exelon Nuclear's 900 Megawatt Dresden 3 nuclear unit increased power up
to 18% following an unplanned maintenance outage last week.

Bloomberg News, 1333 May 10, 2004

**Salem 2 Operating at 85% Following Maintenance, Company Says**

PSEG's 1150 Megawatt Salem 2 nuclear 2 unit was down to 85% power
because of storms and a transmission line in maintenance

Bloomberg News, 1246 May 10, 2004

**PG&E Unit\'s 1,080-Megawatt Plant in New York Enters Service**

PG&E Corp.\'s bankrupt power-generation unit, National Energy & Gas
Transmission, brought a 1,080-megawatt gas-fired power plant in upstate
New York into service late last week. The plant in Athens, about 130
miles north of New York City, sells its production in the wholesale
market operated by the New York Independent System Operator.

Bloomberg News, 1358 May 10, 2004

**Scottish Power\'s U.S. Unit to Build New Plant in Utah**

British utility Scottish Power said on Monday its PacifiCorp U.S. unit
had approved the development and construction of a new 534 megawatt
power plant near Salt Lake city, Utah, for \$330 million. PacifiCorp
plans to enter into an asset purchase and sale agreement with
Denver-based Summit Vineyard LLC to develop the plant, and with Siemens
Westinghouse Power Corp to build the gas-fired combined-cycle gas
turbine plant, the firm said. The plant, named Lake Side, was selected
as the best option from 53 offers submitted to PacifiCorp as part of the
company\'s requests for new base load resources to be on line for summer
2007, it added. Reuters, 1227 May 10, 2004

**NWRFC Sees Below Normal Northwest U.S. Hydroflows\
**The Northwest River Forecast Center (NWRFC), in its latest forecast
for the 2003-2004 water year, said the volume of water flowing through
the region\'s big hydro electric dams will be below normal. The
Portland, Oregon-based agency said flows through the Dalles dam will
average 74 percent of normal from January through July, down from a
previous forecast of 76 percent issued on April 29. The Dalles is the
next-to-last dam on the Lower Columbia and a key point to measure the
volume of water available for power generation in the Northwest. The
region receives about 65 percent of its power supplies from
hydroelectric dams. NWRFC\'s final projection for the 2002-2003 water
year, issued in July, put The Dalles at 83 percent of normal

<http://biz.yahoo.com/rm/040510/utilities_nwrfc_1.html>

**Spike in Energy Costs Leads to Power Shutoffs at Seattle Steel Mill**
-Electricity for Nucor Steel, Seattle City Light\'s largest customer,
has been interrupted for 96 hours this week because of high energy
costs. Under an agreement approved by the City Council in March, Nucor
pays a lower power bill and, in exchange, the utility has the ability to
interrupt the steel company\'s power if the rates go above the \$51 a
megawatt hour that Nucor is paying. That happened this week, triggered
by rising natural-gas prices and a California heat wave that led to
potential power-grid overloads in Southern California. California\'s
energy prices drive those of other Western states.
[http://powermarketers.netcontentinc.net/newsreader.asp?ppa=8knpp%5EZijovpnrWSki%216C%29bfej%5B%21](http://powermarketers.netcontentinc.net/newsreader.asp?ppa=8knpp^ZijovpnrWSki!6C)bfej%5B!)

**Xcel Expects No Colorado Supply Problems during Summer Months T**he
summer power forecast for Colorado: ample supplies but continued
questions about system reliability. As California once again grapples
with sweltering heat and a potential power crisis, Colorado\'s largest
utility says it has more than enough electricity to supply its customers
this summer. Demand for power has increased 60 percent over the past
decade, and Xcel Energy has kept pace with a steady supply of new
generation. The unknown factor for Xcel, however, is how well its
electric distribution system holds up after two years of sporadic power
disruptions in metro Denver. \"They should be able to meet the (demand)
for power without much trouble,\" said Ken Reif, director of the
Colorado Office of Consumer Counsel, a state utility oversight agency.
\"But reliability is anybody\'s guess,\" Reif said. \"All of the
(improvements) they\'ve proposed are steps in the right direction, but
we won\'t know if that\'s adequate until the end of the summer.\"
Failing transformers that weren\'t designed for modern power loads
caused hundreds of localized outages during the past two summers,
leading to investigations by state regulators over the reliability of
Xcel\'s system. Xcel plans to spend \$28 million in Colorado this year
on system improvements, including replacement of faulty transformers,
tree trimming and additional maintenance and repair staffing.
[http://powermarketers.netcontentinc.net/newsreader.asp?ppa=8knpp%5EZijowxyz%5BSki%216C%29bfej%5B%21](http://powermarketers.netcontentinc.net/newsreader.asp?ppa=8knpp^Zijowxyz%5BSki!6C)bfej%5B!)

**Secure Energy Supply Top Worry for Utilities - Poll**

Blackouts on both sides of the Atlantic have propelled security of
energy supply to become the top concern for utilities companies across
the world, an industry survey said on Monday. PricewaterhouseCoopers\'
sixth annual survey of the global utilities industry said securing power
supply had risen from the fourth concern only twelve months ago to the
highest ranking issue of 2004. The report, \"Supply Essentials:
Utilities Global Survey 2004\", also echoed a recent study by the
International Energy Agency which said investment in the global
electricity sector would have to rise sharply to cope with higher
demand. \"If blackouts are not to become a regular feature of the
future, major investment in the sector is required,\" said Manfred
Wiegand, Global Utilities Leader at PricewaterhouseCoopers said in a
statement. The International Energy Agency has estimated the global
electricity sector needs to invest \$10 trillion between 2003 and 2030,
three times higher than the investment during the previous 30 years.
PricewaterhouseCoopers\' survey polled 178 companies across 47
countries. Reuters 1901, May 9, 2004

####### Petroleum

**NYMEX Crude Settles \$1 Lower on Saudi Call to Boost OPEC Output**

June crude futures on the New York Mercantile Exchange settled \$1 lower
at \$38.93/bbl Monday following Saudi Arabia\'s call for OPEC to
increase production by 1.5-mil b/d when it meets next month in Beirut.
\"Saudi Arabia

has apparently caved in to political pressure from the US, the
International Energy Agency and the price itself, which have all been
calling for more oil from OPEC in order to cap the rise in prices,\" Tim
Evans, energy analyst at

IFR Energy Services, said in a report. \"In conjunction with Saudi
Arabia\'s call for an OPEC production hike, this probably also signals
the end of the token effort to comply with the April 1 production
cuts.\" June unleaded

gasoline settled 4.23 cts lower at \$1.2963/gal with a potential
increase in crude supply signaling greater refined product output. June
heating oil settled 3.68 cts lower at 97.96 cts/gal.
<http://www.platts.com/Oil/News/3810172.xml?S=n>

**Iraq's Exports Fall Over Weekend as Pipeline Hit**

Iraq\'s oil exports fell by more than a third after saboteurs struck a
pipeline over the weekend. It will take two days to repair the damage,
an adviser to the Iraqi oil ministry said.

#### Bloomberg News, 1439 May 10, 2004

#### Reuters, 1327 May 10, 2004

#### 

#### Natural Gas 

**Portion of Boston's Commuter Rail Closed Due to Gas Leak**

A reported propane tank leak Friday afternoon, May 7, forced the
Massachusetts Bay Transit Authority (MBTA) to shut down the Belmont
station on the Fitchburg commuter rail line**.** As a result commuter
rail service between Boston and Fitchburg was disrupted. Passengers were
taken by bus from the Porter Square station in Cambridge to the Waverly
station in Waltham. MBTA spokesman Joe Pesaturo said Belmont police
asked the T to shut down rail service in both directions.
[http://www.boston.com/news/local/massachusetts/articles/2004
/05/07/portion_of_commuter_rail_closed_due_to_gas_leak/](http://www.boston.com/news/local/massachusetts/articles/2004/05/07/portion_of_commuter_rail_closed_due_to_gas_leak/)

####### 

####### 

####### Other

**US FERC, Canada\'s NEB Sign MOU to Enhance Agency Cooperation**

The US Federal Energy Regulatory Commission and Canada\'s National
Energy Board on Monday signed a memorandum of understanding \"to enhance
interagency coordination,\" the NEB announced. NEB Chairman Ken Vollman
and FERC Chairman Pat Wood III signed the MOU in Halifax, Nova Scotia,
where both were attending the annual conference of the Canadian
Association of Members of Public Utility Tribunals. \"This agreement
reinforces our existing cooperative relationship and furthers the work
of both agencies,\" Vollman said in a statement. \"The interests of
regulated companies and the public will be better met through enhanced
coordination of our agencies\' regulatory responsibilities.\" Wood said
that the MOU will help facilitate cooperation between the US and Canada
as they \"become ever more interdependent in cross-border energy
issues.\"
[http://www.platts.com/Natural%20Gas/News/6674669.xml?S=n](http://www.platts.com/Natural Gas/News/6674669.xml?S=n)

**US East Coast Fills Up on Brazilian Ethanol**

NEW YORK --- Brazilian cargoes of ethanol have become a regular feature
in the New York harbor in recent months, as high ethanol spot prices
make shipments commercially viably despite a 54¢ per gallon tariff that
the US has slapped on imports to protect domestic producers. Traders
said Friday that since New York and Connecticut banned methyl tertiary
butyl ether (MTBE) as gasoline additive in favor of ethanol on Jan. 1,
Brazilian sugar based

ethanol has replaced some of the corn-based US ethanol, or filled supply
gaps at times of shortages. Some ethanol cargoes from the Caribbean go
via the Panama Canal to the US West Coast to feed California, which
banned MTBE at the same date, traders said. Ethanol helps gasoline burn
cleaner and better. Eduardo Pereira de Carvalho, president of the
leading Brazilian trading group Unica, said Friday at the launch of a
new ethanol futures contract in New York that Brazil in fact "can
produce ethanol cheaper than gasoline." At a current spot price of some

\$1.65/gallon, it pays for US customers to buy Brazilian ethanol,
Pereira de Carvalho said. A gallon costs 60¢ in Brazil plus 30¢ to ship,
which leaves room for the 54¢ import tariff and taxes. Pereira de
Carvalho applauded the

launch of the ethanol contract by the New York Board of Trade (Nybot),
the mother company of the New York cotton, coffee, sugar and cocoa
exchanges. "Such a contract should help build the international
commodity called ethanol," he said. The contract, which started trading
Friday, should help the ethanol industry hedge its risk. An option
contract on the future will start trading today. The Nybot moved into
the building of the New York Mercantile Exchange (Nymex) last year. The
ethanol contract, which opened at 76¢/gallon on Friday, will start
open-outcry trading in four months only --- June, September, November
and February --- and expand as time goes on, the Nybot said. The ethanol
contract will track sugar prices, but is likely to be used, among
others, by refiners, oil traders and blenders dealing with ethanol, said
Nybot Chairman Frederick Schoenhut Friday. The US consumption of ethanol
is expected to increase rapidly as 19 states, including New York,
Connecticut and

California have banned MTBE as gasoline additive for environmental and
health reasons. The other 16 states will phase in the use of ethanol
this year or later. Total global ethanol production is estimated at 10.2
billion gallon, and 60% comes from sugar. Brazil is the largest
producer, and consumption is set to rise by some 5%-10% per year.

Pereira de Carvalho said that Brazil's exports are likely to rise from
the current 290 million gallons to 475 million gallons next year.
Setting up an ethanol contract has been tried several times in the past,
typically at times when oil supply was insecure, notably during the oil
crises of 1973 and 1979. But this time the contract is facing a bright
future because of booming demand, Nybot CEO Charles Falk said.

Oil Daily, May 10, 2004

**Energy Prices**

+-------------------------------+-----------+-----------+------------+
|                               | **Latest  | **Week    | **Year     |
|                               | (5        | Ago**     | Ago**      |
|                               | /10/04)** |           |            |
+-------------------------------+-----------+-----------+------------+
| **CRUDE OIL**                 | 38.98     | 38.26     | 25.74      |
|                               |           |           |            |
| **West Texas Intermediate     |           |           |            |
| US**                          |           |           |            |
|                               |           |           |            |
| \$/Barrel                     |           |           |            |
+-------------------------------+-----------+-----------+------------+
| **NATURAL GAS**               | 6.14      | 5.80      | 5.24       |
|                               |           |           |            |
| **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