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Today, prices for power have plunged, and investors are worried about the possibility of an electricity glut and the heavy debt loads carried by many energy companies.
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However, the recent slowdown in the demand for electricity and the glut of natural gas from the rise in fracking has driven down wholesale prices.
Today's glut of electricity could be gone by 2008.
JUST a few years ago, China was still worrying about a glut of electricity.
With the decline in textile and furniture factories that had been a mainstay in the state, the company had a glut of electricity.
Similar plans were announced in the early 1990's but were abandoned because of a slowing economy and a temporary glut in electricity.
Reliant Resources, which sells energy in Texas and 12 other states, said yesterday that it would have $1 billion in third-quarter costs to write down the value of power plants amid a glut of electricity supplies.
In part, the company's problems are beyond its control, a result of the collapse in natural gas prices this year and investor fears of a coming glut in electricity.
Investors have become increasingly concerned that a surge in new power plant construction will lead to a glut of electricity within a few years and lower the value of Enron's role as a middleman between plant owners and electricity users.
By the next presidential election in 2004, there should be a glut of electricity.
High and supposedly unmanageable debt loads, a glut of electricity and continued repercussions from the collapse of Enron were among the ills that plagued the industry and drove share prices into the ground.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com