Enron, WeatherWise enter agreement

HOUSTON -- Enron Corp. said WeatherWise USA, a consortium of utility companies, agreed to a contract that will limit the risk of weather on Enron's energy sales.

Enron's earnings can be affected when freezing weather bring surges in prices for natural gas and electricity.

Enron is one of the leading natural gas pipeline companies, owns an Oregon electric utility and arranges power sales for utilities and big electricity consumers. The WeatherWise contract is designed to let Enron offer steady prices for power and natural gas, no matter what weather does to the market. "As the energy industry becomes more competitive, the ability to manage weather risk will become increasingly more important to our customers," said Kevin Hannon, president and chief operating officer of Enron's Enron Capital and Trade. Enron will make payments to WeatherWise or receive payments from the venture, based on the how much temperatures deviate from past norms. Enron, a natural gas and electricity company based in Houston, would not give the exact terms of the deal. WeatherWise, a Pittsburgh-based energy services company, is jointly owned by a venture of New England Electric System and Eastern Enterprises called AllEnergy Marketing, DQE Inc.'s DQ Energy Partners, a KN Energy and Pacificorp venture called en-able, and ProLiance Energy.

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