FERC subpoenas energy firms

Several leading energy companies in the US, including AES, Duke Energy, Reliant Resources, Mirant and Williams confirmed that they have been issued subpoenas from prosecutors investigating allegations of price fixing during the California power crisis.

The Federal Energy Regulatory Commission says that it has details of telephone conversations in which energy company employees discuss ways of extending maintenance outages at an AES plant in 2000.

California is seeking $9bn in refunds for alleged price fixing by Enron and other energy companies. The state believes that the companies colluded to manipulate the market, inflating electricity prices and causing blackouts. FERC is expected to conclude its investigations in early 2003, when it will decide on the validity of California’s claims.

Foster Wheeler takes JEA to court

Foster Wheeler’s subsidiary, Foster Wheeler Energy Corp. (FWEC) has taken JEA, formerly known as Jacksonville Electric Authority, to court for breach of contract.

Florida-based JEA had a contract with FWEC for the engineering, procurement and construction of two circulating fluidized bed (CFB) boilers with an accompanying boiler at JEA’s Northside generating station.

FWEC alleges that after successfully completing the design, procurement and initial construction phases of the project, JEA interfered with its work and failed to provide services and site access, resulting in delays to the project. The complaint also alleges that JEA has failed to pay outstanding invoices of $30m, and that FWEC has not been unable to demonstrate its CFB technology.

Fuel cell breakthrough

Fuel cell researchers in the USA have developed a solid oxide fuel cell (SOFC) that they say can generate electricity as cheaply as the most efficient gas turbine.

The research team from the Berkeley Lab says it is coming closer to breaking the cost barrier of $400/kW set by the Department of Energy’s Solid State Energy Conversion Alliance.

The new development involves replacing ceramic electrodes with stainless steel-supported electrodes that are strong, easy to manufacture and cheap, marking a breakthrough in the development of commercially viable fuel cell power plants.

Ecuador halts hydropower plans

Conelec, Ecuador’s electricity regulator, has reversed a decision to allow a Spanish consortium to build a $500m hydroelectric plant due to contract irregularities.

The concession for the hydropower plant was granted in April 2002 to a Union Fenosa-lead consortium. The $500m, 186 MW hydro plant in southern Ecuador would expand the capacity of the Hidropaute plant.

Conelec rejected a section of the contract that involved merging the Spanish consortium, involving Actividades de Construccion y Servicios, with the State-run Hidropaute. The regulator stated that as Hidropaute is state-owned, the merger would require a public bidding process. Local laws also state that the Spanish consortium needs to domicile itself in Ecuador.

A final decision on the concession is now likely to be delayed until early 2003 when a new administration will take over in Ecuador following the November elections.

Vegas hosts first hydrogen plant

The US will be the first country to experiment with a hydrogen energy station featuring the co-production of hydrogen fuel and electric power that can be used to fuel vehicles as well as produce electricity.

The hydrogen plant will be constructed in Las Vegas under a five-year public-private partnership between the Department of Energy, the City of Las Vegas, Air Products and Chemicals and Plug Power, and is set to cost $10.8m. The project will supply around 50 kW to the Las Vegas electrical grid system as a demonstration of hydrogen as a safe and clean energy alternative.

Tractebel teams with Codelco for Edelnor acquisition in Chile

Tractebel and Chile’s Codelco, the state-owned copper producer, have bought an 82.34 per cent share in Edelnor, the country’s major thermal power company for $5.7m.

The acquisition follows Edelnor’s filing of Chapter 11 bankruptcy proceedings in September this year. The bankruptcy court has approved Edelnor’s plan to restructure its $340m of debt, allowing Tractebel to exercise an option to purchase a 33 per cent stake in the company. Tractebel had an exclusive option to buy the troubled company since Mirant Corp. sold off its 82.34 per cent share last year.

The deal makes Tractebel one of the largest players in Chile’s energy sector. Edelnor is a major player in Chile’s northern power grid, with 720 MW of installed thermal capacity, and a network of 1000 km of transmission lines.

News digest

Argentina: Argentina will raise electricity rates by presidential decree, skipping a legally required set of public hearings in a bid to quickly comply with an IMF mandate.The country’s currency has fallen 70 per cent since January, forcing many Argentine companies with dollar-denominated debts into default.

Canada: Engineering company SNC Lavalin Group confirmed it is one of the bidders for part of Hydro One, the electricity transmission network that the Ontario government wants to partly privatize. On the heels of similar SNC investments in Alberta and Australia, owning part of the vast Ontario grid would give the Montreal firm the opportunity for lucrative contracts for line maintenance and expansions.

Chile: Endesa has cut planned investments for the second time this year in an attempt to reduce debt, after net income in the third quarter dropped 8.6 per cent to $261m. It will cut investment in Latin America, especially Chile, where Endesa holds a controlling stake in Enersis, the electricity utility. It plans to sell $1bn of assets and issue $1.5bn of shares next year, saving the Chilean business $500m a year.

Ecuador: Ecuador and Peru signed an agreement to hook up their electric transmission lines by the end of 2004 to help offset declines in hydroelectric power production during droughts. The Andean nations agreed to build a 146 km transmission line across their shared border under a $17m project which will take Ecuador’s Transelectric and Peru’s Red de Energia an estimated 22 months to complete.

USA: Officials from the US Department of Energy have met with GE Power Systems and its research team to kick off a programme to develop a new high-efficiency generator that will provide major benefits for US utilities.

USA: E.ON has halted its US expansion programme and said it would delay plans to buy a power generator in the country’s Midwest as it anticipated declines in utilities valuations. E.ON had said it wanted to buy one or two power utilities near its Kentucky-based LG&E energy utility, which it acquired through its $14.8bn purchase of Powergen of the UK.

USA: Alstom has been awarded a $160m contract by Santee Cooper, South Carolina’s state-owned electric and water utility, to supply a 640 MW sub-critical pulverized coal fired utility boiler to be located at Cross Generating Station in Berkeley County, near Cross, South Carolina. Completion is due for January 2007.

USA: Ireland’s Electricity Supply Board has won a five-year contract to manage a regional power grid in the southeastern USA.