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

**Office of Energy Assurance**

**ENERGY ASSURANCE DAILY**

**January 30, 2004**

**Electricity**

**Update -- Less than 20,000 Customers Still Out of Power in Southeast
US**

Less than 20,000 customers, mainly in South Carolina, were still without
power on Friday after a winter storm struck the Southeast beginning late
Monday, local utilities said. Restoration was expected to be completed
over the weekend. Reuters, 1325, January 30, 2004

**Update - San Onofre Nuke Plant Repairs Due to Radioactive Leak**

One of two operating reactors at the San Onofre Nuclear Generating
Station, located near San Clemente, CA, is still down for repairs this
week after plant-monitoring equipment detected a leak of radioactive
water. Saturday, January 24. \"It\'s one-tenth of one gallon per minute
\-- very, very small,\" Southern California Edison spokesperson Ray
Golden said. Plant operators noticed the leak at 8 p.m. Saturday in what
Golden described as a subsystem called a chemistry volume control
system. He said the leak has been isolated inside the reactor and \"we
hope to have the unit back up at full power by this weekend.\"\
Source: [http://hsweb01.screamingmedia.com/PMA/pma_newsarticle1_krt.h
tm?SMDOCID=knightridder_2004_01_28_krtbn_0000-0336-OC-NUKE-L
EAK&SMContentSet=0](http://hsweb01.screamingmedia.com/PMA/pma_newsarticle1_krt.htm?SMDOCID=knightridder_2004_01_28_krtbn_0000-0336-OC-NUKE-LEAK&SMContentSet=0)

**Springerville Power Plant in WECC Tripped Midday Thursday** The plant
has since recovered and is running near previous levels early Friday.
Genscape Overnight Update, January 30, 2004

**Callaway 1 Nuke Back up to 99 Percent** AmerenUE's 1,143 MW Callaway 1
nuclear unit in Fulton, Missouri geared up to 99 Percent, up from 0
percent in the last NRC report. The plant was shut down on Tuesday,
January 27^th^ due to a mechanical failure involving a relay switch to a
circuit breaker. Bloomberg News, 1034, January 30, 2004

**Salem 1 Nuke Resumes Full Power** PSEG's 1,150 MW Salem 1 nuclear unit
in Hancocks Bridge, New Jersey has powered back up. Power had to be
reduced to clear away debris from an intake canal that supplies water to
the plant. Bloomberg News, 0957 January 30, 2004

**In U.S. Midwest, Transmission is Unavailable to Move Much Power
North**

In the Midwest, the upper Plains continued to lead the market on the
coldest conditions in the Midwest and another day of congestion on the
north-south grid. \"Transmission is unavailable to move much power
north. Even firm schedules were getting trimmed this morning,\" said a
Plains trader. \"The lack of transmission has taken a lot of interest
out of the market,\" he added. Reuters, 1157, January 30, 2004

**Michigan Utility Regulators Set New Reliability Standards**\
The Michigan Public Service Commission on Thursday formally adopted
standards for reliable electric service and penalties for utilities that
don\'t comply. The new rules were required by Michigan\'s 2000 electric
restructuring law, but are also part of the state\'s larger effort to
improve utility customer safeguards following the massive Aug. 14, 2003,
blackout, which hit Michigan hard, commission Chairman J. Peter Lark
said. The new reliability standards involve requirements for system
upgrades, maintenance, customer service, public safety and time limits
on customer power outages, among other issues. Utilities will have
financial incentives to meet standards, and will be penalized if the
don\'t, the commission said. For example, customers would receive either
a \$25 credit or their monthly service charge - whichever is larger - if
they experience repetitive power disruptions. Utilities can seek waivers
under certain circumstances.
<http://biz.yahoo.com/djus/040129/1752001733_1.html>

**Petroleum**

**U.S. Northeast Fuel Barges Scarce to Mid Feb-trade**

A combination of high demand and weather conditions make fuel barges and
tankers scarce for the U.S. Northeast until at least the mid-February,
traders and shipping sources said on Friday. \"I don\'t think you can
find a barge until Feb. 10,\" said an East Coast products trader. \"When
it gets here on the Colonial, and there are no barges to take it or
storage for it, it\'s gonna make prices go down,\" said a New York
Harbor fuels trader. The trader said a tanker of jet fuel is expected in
New York Feb. 3-5 but without barges, it is not likely that the load
would be able to be lightered at that time. The U.S. Coast Guard said on
Friday that fuel barges have been slowed for the past week even though
they can navigate the New York Harbor \-- which is both New Jersey and
New York \-- as well as ports in Boston and Philadelphia. Earlier this
week, barges in the Cape Cod Canal were delayed but they were able to
pass on Friday, said the Coast Guard.nife.

Reuters, 1400, January 30, 2004

**EPA Pressed to Waive Oxy Mandate for New York, California**

WASHINGTON --- The Bush administration's proposal to allow New Hampshire
to opt out of a federal rule on clean burning gasoline is triggering
fresh demands from New York and California lawmakers to let their states
sidestep the rule as well. Sen. Charles Schumer (D-N.Y.) on Wednesday
urged EPA to exempt the state from the rule, saying the regulation could
cause gasoline prices to go up in his state. New York sought an
exemption from the rule last year, but EPA set the request aside saying
the documents produced to back the demand for a waiver were not
adequate. Since then, the state has provided documents showing
logistical constraints and also air quality problems resulting from
using ethanol. Similarly, Sen. Dianne Feinstein (D- CA), is making a
case for EPA to exempt California from the mandate. In 2001 EPA rejected
California's request for a waiver, but that is not stopping Feinstein
from renewing her call. "Like New Hampshire, California's refiners can
produce gasoline that is cleaner than that made in the federal

reformulated gasoline program," Feinstein said in a letter to EPA
Administrator Mike Leavitt on Wednesday.

Oil Daily, January 30, 2004

**U.S. Heating Oil Heads for Biggest Weekly Drop Since May 2003**

New York heating oil futures fell, heading for the biggest drop in nine
months, as the price for rival fuel natural gas slid, bolstering
expectations industrial customers will keep burning the fuel instead of
seeking oil-based alternatives. Waning demand from utilities will allow
more heating oil to be available to meet consumer-heating demand which
is soaring. Bloomberg News, 1233 January 30, 2004

**Gary Williams Idles Alkylation Unit at Oklahoma City Refinery**

Gary-Williams idled a 5,000 b/d alkylation unit at its 45,000 b/d
refinery in

Wynnewood, Oklahoma, for unplanned work, a source close to refinery
operations

said Friday. There is no estimated timeframe for repair on the unit, the

source said. Separately, the company is to start bringing down units at
the

refinery for planned maintenance on Feb 15, the source said. Repairs are
to

last 25 days. Other units at the plant include a catalytic cracker, a
reformer

and a hydrocracker. Gary-Williams is one of two main suppliers of
premium

gasoline in the Group 3 market.
[http://www.platts.com/Oil/News/Gary-Williams%20idles%20alkylation%20unit%20at%20Oklahoma%20refinery%20source.xml?p=Oil/News&S=n](http://www.platts.com/Oil/News/Gary-Williams idles alkylation unit at Oklahoma refinery source.xml?p=Oil/News&S=n)

**U.S. Considers More Oil Drilling in Alaskan Waters**

The U.S. Interior Department on Friday asked energy firms for comment on
whether they would be interested in drilling for oil and natural gas in
three areas in Alaskan waters. The department is considering leasing
federal tracts for energy exploration in Alaska\'s Chukchi Sea, Hope
Basin and the Norton Basin. The department will take comment through
April 29 from companies. \"A decision to offer a nominated area for
leasing will depend on a commitment from industry to explore the area
leased within a specific time period,\" the department said. The
department said it will decide in May whether to proceed with a lease
sale. Details on the proposed leasing areas were published in today's
Federal Register.

Reuters, 1458, January 30, 2004

**Natural Gas**

**Selling Natural Gas When Gas Price Spikes May Be Prudent Choice for
Utilities** Energy Security Analysis, Inc. just released a comprehensive
analysis of the issue of whether utilities should be selling natural gas
into the market if the price skyrockets. Remember that the CT AG felt
utilities should not and announced an investigation of these reported
trades. (The Energy Assurance Daily first reported on this situation on
January 16, 2004, in the Highlights Section and covered the CT AG
allegations on January 21, 2004 in the Highlights Section.) This study
by ESAI concludes that under certain circumstances, it is the prudent
action. The study states, "Clearly the risk for the generator is too
high to hold and bid into the RT market under such extreme conditions.
Selling the gas back into the market as soon as notification is received
for 'no dispatch' in the Day Ahead Market is one of the most prudent
choices for a generator to make when faced with such extreme risk."
ESAI, WECC Energy Watch February 2004

**Other News\
**

**US FERC Overextending Jurisdiction, States Tell US Congress**

The US Federal Energy Regulatory Commission is continuing to pursue
\"risky\" restructuring proposals that could implement aspects of its
controversial standard market design proposal, according to letters from
the Alliance of State Leaders Protecting Electricity Consumers. The
group also said it believes the US Congress clearly had signaled an
intent to slow down market reform. The letters to staff members of the
Senate Energy and Natural Resources Committee and House Energy and
Commerce Committee said FERC is analyzing 10 cases that could force
regional transmission organization formation or preempt state
jurisdiction. \"Fern\'s docket currently includes no less than 10
proceedings that would compel or coerce RTO participation, implement
aspects of SMD, and preempt or interfere with state authority,\" the
alliance said. The letters were dated Wednesday and made available to
Platts Friday.
[http://www.platts.com/HOME/News/US%20FERC%20overextending%20jurisdiction,%20states%20tell%20US%20Congress.xml?p=HOME/News&S=n](http://www.platts.com/HOME/News/US FERC overextending jurisdiction, states tell US Congress.xml?p=HOME/News&S=n)

**Houston Ship Channel Opens After Fog Halts Traffic Overnight**

The Houston Ship Channel, the main waterway linking the Gulf of Mexico
to Houston-area oil refineries was operating normally after fog halted
shipping for nine hours overnight, the U.S. Coast Guard said. Bloomberg
News, 1117 January 30, 2004

**Truck Hauling Nuclear Fuel Rods Crashes in Arkansas; No Danger to
Area**

The last remaining containers of spent fuel rods were removed Thursday
from a tractor-trailer involved in an accident shortly after midnight
Wednesday. None of the ten fuel rods carried by the truck were damaged
in the accident.
[*http://www.couriernews.com/story.asp?ID=4681*](http://www.couriernews.com/story.asp?ID=4681)

**Energy Prices**

+-------------------------------+-----------+-----------+------------+
|                               | **Latest  | **Week    | **Year     |
|                               | (1        | Ago**     | Ago**      |
|                               | /30/04)** |           |            |
+-------------------------------+-----------+-----------+------------+
| **CRUDE OIL**                 | 33.16     | 34.94     | 33.78      |
|                               |           |           |            |
| **West Texas Intermediate     |           |           |            |
| US**                          |           |           |            |
|                               |           |           |            |
| \$/Barrel                     |           |           |            |
+-------------------------------+-----------+-----------+------------+
| **NATURAL GAS**               | 5.80      | 5.82      | 5.76       |
|                               |           |           |            |
| **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)

Last Updated on January 28, 2004

**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)

Last Updated on January 28, 2004

**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)

Last Updated on January 29, 2004