Application to Export Electricity Enron Power Marketing, Inc.

DEPARTMENT OF ENERGY

Office of Fossil Energy

[FE Docket No. EA-102]

Application to Export Electricity Enron Power Marketing, Inc.

AGENCY: Office of Fossil Energy, DOE.

ACTION: Notice of application.

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SUMMARY: Enron Power Marketing, Inc., (Enron) has requested

authorization to export electric energy to Mexico. Enron is a marketer

of electric energy. It does not own or control any electric generation

or transmission facilities.

DATES: Comments, protests, or requests to intervene must be submitted

on or before January 3, 1995.

ADDRESSES: Comments, protests, or requests to intervene should be

addressed as follows: Office of Coal & Electricity (FE-52), Office of

Fuels Programs, Fossil Energy, U.S. Department of Energy, 1000

Independence Avenue, S.W., Washington, D.C. 20585.

FOR FURTHER INFORMATION CONTACT: Ellen Russell (Program Office) 202-

586-9624 or Michael T. Skinker (Program Attorney) 202-586-6667.

SUPPLEMENTARY INFORMATION: Exports of electricity from the United

States to a foreign country are regulated and require authorization

under section 202(e) of the Federal Power Act.

On October 4, 1994, Enron filed an application with the Office of

Fossil Energy (FE) of the Department of Energy (DOE) for authorization

to export electric energy to Mexico pursuant to section 202(e) of the

Federal Power Act. Enron owns no generation or transmission facilities

but has been certified by the Federal Energy Regulatory Commission

(FERC) as a power marketer. Enron expects the majority of its

transactions to be short-term sales of electricity for which contracts

have yet to be negotiated.

This is the first application for export that FE has accepted from

an individual entity that does not own or operate physical facilities.

The FE decision to accept an application from a power marketer, as

opposed to the ``traditional'' electric power entities which own and/or

operate physical facilities, is based on the marketer taking possession

of the electric energy inside the United States. This situation is

distinguished from the power broker which simply facilitates a sale of

electric energy without ever taking ownership of the commodity.

The electric energy Enron proposes to transmit to Mexico would be

purchased from electric utilities and Federal power marketing agencies.

Enron asserts that such energy would be surplus to the requirements of

the entities from which it would be purchased. Enron would arrange for

the exported energy to be wheeled from the selling entities, over

existing domestic transmission facilities, and delivered to the foreign

purchaser over one or more of the following international transmission

lines: San Diego Gas and Electric Company's (SDG&E) 230-kilovolt (kV),

Miguel-Tijuana transmission line (PP-68); the SDG&E 69-kV line at San

Ysidro (PP-49); the SDG&E 230-kV, Imperial Valley-La Rosita line (PP-

79); El Paso Electric Company's 115-kV lines at Diablo, New Mexico (PP-

92) and Ascarate, Texas (PP-48-A); Central Power and Light Company's

138-kV and 69-kV transmission lines at Brownsville, Texas (PP-94); and

the 138-kV transmission lines permitted to Mexico's Comision Federal de

Electricidad at Eagle Pass (PP-50), Loredo (PP-57), and Falcon Dam (PP-

57) in Texas.

Enron has suggested that the initial FE authorization be sufficient

for all short-term exports of 90 days duration or less, at unspecified

rates of transmission, over any of the international transmission

facilities identified above.

For exports over 90 days duration, Enron has suggested that it

notify FE prior to commencing exports and that it provide the following

information: (1) The name of the purchaser(s); (2) the term of the

agreement; (3) the contract transmission route(s) and the name of the

companies providing transmission wheeling services; (4) the related

FERC Rate Schedule, if applicable; and (5) the point(s) of exportation.

Enron further suggests that FE publish a notice of the proposed

transaction in the Federal Register, stating that the transaction would

be deemed approved and allowed to commence unless, within 10 days of

publication of such notice, (1) a protest is filed, or (2) FE notifies

Enron that the transaction is not approved. Subject to the foregoing,

Enron could commence exportation at the end of a 10-day comment period.

In the case of either a protest or notification of disapproval by FE,

exports could not commence without specific authorization by FE.

Before FE takes any final action on applications to export, it

first must determine that the proposed action will not impair the

sufficiency of electric supply within the United States or will not

impede or tend to impede the coordination in the public interest of

facilities in accordance with section 202(e) of the Federal Power Act.

For applications from ``traditional'' electric power systems, the

standard procedure is for the applicant to submit various technical

studies which demonstrate the operation of the regional electric power

supply system with the applicant exporting specified levels of power

over identified international transmission lines. The applicant also is

required to demonstrate that it would have sufficient generating

capacity to sustain the proposed export under the terms and conditions

of its export agreement, while still complying with any established

reserve criteria.

Since marketers generally could not be seen as having any ``native

load'' requirements, the latter criterion of maintaining sufficient

reserve margins appears inappropriate and unnecessary in this instance.

Conversely, FE feels that the issue of coordinated use of regional

transmission (i.e., parallel path flow) becomes more critical in the

case of marketers because of the unspecified nature of the

transactions, in terms of the magnitude and sources of the export, and

the export points.

FE recognizes the right of the marketer to compete in the electric

power arena, as well as the legitimate reliability/operating concerns

of the ``traditional'' electric power systems. Therefore, FE is

proposing an alternative means for determining the reliability impacts

in the case of exports by marketers. In lieu of the technical studies

(power flow, transient stability, etc.) usually submitted in support of

an export application, FE will consider accepting executed transmission

wheeling/access agreements between the marketer/applicant and the

owners of the transmission systems reasonably expected to be involved

in providing transmission service to the export point. FE is

considering requiring the submission of these transmission access

agreements prior to any exports (short- or long-term) occurring over

any particular export point. If an export order is granted, the

applicant could ``activate'' any or all export points by submitting

appropriate transmission agreements. After submission of the

agreement(s), the applicant would be permitted to engage in short-term

exports immediately, and long-term exports subject to the procedures

discussed above.

FE is soliciting comments particularly on the procedures it is

considering for addressing electric reliability concerns and the

authorizing of exports of longer than 90 day duration.

Procedural Matters

Any person desiring to be heard or to protest this application

should file a petition to intervene or protest at the address provided

above in accordance with Secs. 385.211 or 385.214 of the Rules of

Practice and Procedure (18 CFR 385.211, 385.214).

Any such petitions and protests should be filed with the DOE on or

before the date listed above. Additional copies of such petitions to

intervene or protests also should be filed directly with: Steven J.

Kean, Vice President, Regulatory Affairs, Enron Power Marketing, Inc.,

PO Box 1188, Houston, Texas 77251-1188. (710) 853-1586. FAX (713) 646-

3490 and David B. Ward, Flood & Ward, 1000 Potomac Street, NW, Suite

402, Washington, DC 20007. (202) 298-6910. FAX (202) 298-6914.

Pursuant to 18 CFR 385.211, protests and comments will be

considered by the DOE in determining the appropriate action to be

taken, but will not serve to make protestants parties to the

proceeding. Any person wishing to become a party must file a petition

to intervene under 18 CFR 385.214. Section 385.214 requires that a

petition to intervene must state, to the extent known, the position

taken by the petitioner and the petitioner's interest in sufficient

factual detail to demonstrate either that the petitioner has a right to

participate because it is a State Commission; that it has or represents

an interest which may be directly affected by the outcome of the

proceeding, including any interest as a consumer, customer, competitor,

or a security holder of a party to the proceeding; or that the

petitioner's participation is in the public interest.

A final decision will be made on this application after a

determination is made by the DOE that the proposed action will not

impair the sufficiency of electric supply within the United States or

will not impede or tend to impede the coordination in the public

interest of facilities in accordance with section 202(e) of the Federal

Power Act.

Before an export authorization may be issued, the environmental

impacts of the proposed DOE action (i.e., granting the export

authorization, with any conditions and limitations, or denying it) must

be evaluated pursuant to the National Environmental Policy Act of 1969.

Copies of this application will be made available, upon request,

for public inspection and copying at the address provided above.

Issued in Washington, DC, on October 27, 1994.

Anthony J. Como,

Director, Office of Coal & Electricity, Office of Fuels Programs,

Office of Fossil Energy.

[FR Doc. 94-27191 Filed 11-1-94; 8:45 am]

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