Williams Companies supplies the plant with natural gas, buys the power at a price set in a 1998 contract, then turns around and sells it on California's digital electricity marketplace, called the Power Exchange. Enron Corp., based in Houston, is the largest marketer of energy in the nation. Come January, the power plant in Huntington Beach burns fuel, spins turbines and squirts 100 megawatts of electricity onto the transmission grid that connects the West from Canada to Mexico. The price doesn't always go up in the market, of course. When January rolls around, warm weather might settle on Seattle.
Residents use less electricity to heat their homes.
It's unlike any other commodity in the world. So the electricity industry is hyper-planned. Though they are invisible to most consumers, the marketers are in the cross-hairs of California politicians desperate to bring down wholesale electricity costs. A rate freeze imposed as part of the Legislature's 1996 deregulation law still protects customers, though talks began last week between the utilities and the governor's office on the possibility of a rate hike next year to help the utilities' begin recouping costs. Gov. Gray Davis takes care to include marketers and brokers when he publicly chastises the players in California's market for excessive greed.