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ERCOT 2019 Summer Quarter Outlook

LCG, May 29, 2019-- LCG released a new summer (June – September 2019) report that looks at how the ERCOT grid copes with strained network conditions. Resource adequacy analysis for the region is especially important during extreme summer loading conditions. This summer the network is under particular scrutiny as the reserves have tightened because of recent retirements.

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South Field Energy Breaks Ground for 1,182-MW Power Plant

LCG, May 16, 2019--South Field Energy LLC announced yesterday its groundbreaking for an 1,182-MW, combined-cycle electric generating facility in Columbiana County, Ohio. The natural gas-fired facility is scheduled to commence operations in mid-2021 and represents a $1.3 billion investment.

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Industry News

California Capsule: Davis Adamant on $8.9 Billion

LCG, July 11, 2001California Gov. Gray Davis vowed yesterday to accept no less that the entire $8.9 billion he says the state is owed for overcharges by unscrupulous independent power producers.

At a news conference in Sacramento, the governor acknowledged that the decision rests with the Federal Energy Regulatory Commission, but threatened litigation if the state does not get the full amount a study by the California Independent System Operator says it is due.

Referring to a statement Monday by Curtis L. Wagner, FERC's chief administrative law judge, that the refunds due could be $1 billion or less or even nothing Davis said "If you think California will settle for $1 billion, we will see you in court."

"It behooves the governor and his staff to have a change of attitude," said Gary Ackerman, executive director of the Western Power Trading Forum, a generating industry group. "Do the people of California want to have this problem in front of them for months and months and years?" he asked. "I think people want this resolved."

Those comments by the governor and the industry representative indicate the two sides are at about the same place they were when two weeks of negotiations began under Wagner's supervision on June 25.

The decision on refunds now rests with FERC's governing board, and Davis said he won't back away from the $8.9 billion figure conjured up by Cal-ISO. "You order what you think is fair," Davis said at yesterday's news conference. "We'll take what you order, and we'll see you in court."

Having said twice that he would see FERC in court, the governor turned his attention to the state legislature, which is preparing to adjourn for a month long summer vacation next week. He said lawmakers must remain on the job and pass legislation necessary for the state to take over transmission assets belonging to Southern California Edison Co., to save the utility from bankruptcy.

The two issues are related. In saying Monday that the state may be owed no refunds at all, Wagner pointed out that the power producers had not been paid for electricity they had sold to California utilities, and the amount of the past-due bills could exceed the amount of refunds. By paying SoCal Ed $2.76 billion for its wires, the state would provide the utility with money to pay those overdue power bills.

In a parting shot at FERC, Davis said it was up to the commissioners to show whether they were "on the side of consumers or are they just there to do the industry's bidding, as they have so often in the past."

Grid Improvement Meets NIMBY in San Diego Area
"Even when the lights were going dark across California, the grape growers, horse breeders, and hot air balloonists in scenic Temecula Valley opposed a plan to string new electricity transmission lines across and around their land," The Boston Globe said yesterday.

The Boston Globe? California's energy problems have media, politicians, regulators and electric industry officials in every other state using them to take their own citizens' minds off their own shortcomings, and Massachusetts has more than a few.

The Globe reported that a new 500 kilovolt transmission line would connect San Diego Gas & Electric Co. with another system through a 31-mile link that would traverse wilderness, vineyards, parks, and planned communities. And "not-in-my-backyard" protesters are against that link, despite the near certainty of rolling power outages this summer.

Residents say they worry about property values and personal health, the paper said. They talk of tarnished vistas and blotted bluffs. They even question whether the $271 million project known as the Valley-Rainbow Interconnect is needed.

"They've touched everything that is the essence of our valley with one line. They're doing it for greed, not need," said Barbara Wilder, co-chairwoman of Save Southwest Riverside County, a group opposed to the project.

Jim Avery, SDG&E's senior vice president for fuel and power operations, said "It's a relatively small gap but a critical gap, and unless we fix it we could collapse part of the utility grid system. It could be constant blackouts. It could take us hours to recover from it. It could spread throughout Southern California."

The locals aren't buying the utility's warnings of doom, particularly those who think their property values might be adversely affected.

"We would not have bought there had we known of this," said Carl Burke, a human resource manager who lives with his pediatrician wife and three children in Redhawk, a planned community whose golf course would be edged by power lines. "I'm concerned for our safety and I'm also concerned about my property values. We'd probably move -- if we could sell."

Ratepayers Again Denied Standing in PG&E Case
U.S. bankruptcy Judge Dennis Montali yesterday reaffirmed his earlier decision to deny court standing to a proposed committee of Pacific Gas & Electric Co. customers in the utility's bankruptcy case.

Montali ruled against U.S. Trustee Linda Ekstrom Stanley and the ratepayers committee in deciding that ratepayers as a group had no claims and were not creditors when PG&E filed for bankruptcy on April 6.

The judge also criticized a ratepayers committee lawyer for remarks made at a hearing last Thursday, saying media reports left the misconception that by disallowing a ratepayers committee, he would reject all claims of ratepayers and they could lose out on future refunds.

The refunds referred to are those Gov. Davis hopes will be ordered by FERC, but whether PG&E's residential and small commercial customers are eligible for refunds or have even paid market prices for electricity is questionable.

In any case, the judge and the utility both emphasized that the matter of any refunds lies in the hands of the California Public Utilities Commission.

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