Gas

Power Notes

Compiled by OGJ Online Staff

Jan. 26, 2001—Calpine Corp. reported it has acquired the development rights from Cogentrix Energy Inc. for the $300 million 500 MW Washington Parish energy center, near Bogalusa, La. Site preparation is under way, with construction expected to begin shortly. The power plant will use two General Electric Frame 7FA gas combustion turbines in combined cycle with a single steam turbine, representing 490 MW of base load capacity, with the ability to produce up to 577 MW during peak demand. Calpine will manage construction and will operate the facility when it enters commercial operation in mid-2002.

Fitch IBCA has lowered the rating of Caithness Coso Funding Corp.’s $110 million senior secured notes due 2001 from ‘BB+’ to ‘BB’. The rating action reflects the failure of Southern California Edison Co. (SCE) to make timely payments due under existing power purchase agreements (PPAs), and the absence of a clear alternative, Fitch said. Caithness Coso, through three separate partnerships (collectively the Coso partnerships), sells 100% of the power generated from three 80 MW geothermal power projects to SCE under long-term power purchase agreements. SCE is past due on its payment of $13.3 million to the Coso partnerships for power generated in November 2000. The Coso partnerships have also billed SCE $32.5 million for power generated in December 2000. Payment of that amount is due in early February 2001. Despite the ongoing efforts to resolve the California power crisis, it is uncertain whether, or when, the above amounts will be paid, Fitch said.

Rochester Gas & Electric Corp. (RG&E) said it filed a joint settlement plan that would reduce gas delivery rates by an average of about 1% through June 2002. The reduction would take effect March. 1. As part of the rate proposal RG&E is seeking to raise the monthly basic customer rate to $12/month from $6.90/month. This adjustment would take effect Sept. 1. Coupled with a proposed increase in the monthly basic customer charge, the average residential gas heating customer would save about $6.95/year, the company said. The plan will not affect gas commodity prices. The plan is still subject to approval by the New York State Public Service Commission.

The U.S. Justice Department said it will not challenge a proposal by 17 rural Arkansas electric power distribution cooperatives to jointly market electric power to retail customers. The Department’s antitrust division concluded the proposal will not substantially lessen competition. The co-ops, which together control about 6% of the electric generating capacity in regions where they plan to operate, propose to create a joint venture to market power under the state Electric Consumers Choice Act.

Canada’s National Energy Board said it will conduct a full public hearing April 23 on an application by National Energy Systems Co. to construct a new international 230 kv transmission line that will connect its proposed 660 MW gas-fired power plant in Washington to the western power grid via Canada. The power plant will to be located in Sumas, Wash., in the far northwest corner of the state. The company argues the Canadian route is the most cost effective and least intrusive route for the transmission line.

AES Corp. reported an AES subsidiary has acquired from Enron Corp. a majority interest in barge-mounted electric generating units currently under construction in Lagos, Nigeria. Nigeria’s YF Power owns the remaining shares. AES said a total of $225 million will be invested in nine barge-mounted combustion turbines with total net output of 290 MW. Electricity from the plant will be supplied to the Nigerian Electric Power Authority under a 13.25 year agreement. Operation is scheduled to begin in September.

Canada’s Fortis Inc. said it has purchased Duke Energy Group Inc.’s 95% interest in Belize Electricity Co. Ltd. (BECOL) for $62 million (U.S.). The remaining 5% of BECOL is owned by the Belize government. BECOL owns and operates the 25 MW Mollejon hydroelectric facility, located on the Macal River, and the only commercial hydroelectric facility in Belize.