The biggest economic news in Texas is the merging of the electric and natural-gas utility industries in anticipation of the coming deregulation of electricity. Huge deals are in the works: Houston Industries, the parent of Houston Lighting and Power, is acquiring Houston-based NorAm, the nation’s third-largest gas utility; and Texas Utilities is buying Enserch, the largest gas utility in Texas. The main beneficiary of all this activity will be Houston, where many of the largest electricity marketing companies now have a presence. In addition to old rivals Enron and Houston Industries, companies that have set up operations in the Houston area include Entergy (formerly Middle South Utilities), Duke Energy Corporation (the result of a merger between Duke Power Company of North Carolina and Panenergy Corp of Houston), and the California behemoth Pacific Gas and Electric. The reason for the unification of the power industry is that in a deregulated climate—which has not yet come to Texas—big users of power will want the cheapest source they can get, regardless of whether it comes from gas or electricity. Houston is positioned to become to the power market what Chicago is to commodities and New York is to finance: the trading center for the nation. Enron CEO Kenneth Lay has likened the economic impact on the city to fifteen Continental Airlines.