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Fortnightly Magazine - January 15 1995

Westinghouse Cleared in Nuclear Reactor Case

Lori A. Burkhart

On December 6, the jury in a three-month-old trial found that Westinghouse Electric did not engage in fraud by supplying two nuclear reactors with allegedly faulty steam generators to Duquesne Light Co. and four co-owners of the Beaver Valley I and II nuclear plants. The utilities had sought $350 million in compensatory damages, and originally charged Westinghouse with RICO violations, breach of contract and warranty, as well as fraud. But in October, U.S.

California Fines Cellular Firms

Phillip S. Cross

Four facilities-based cellular telecommunications companies will pay fines totalling $5.52 million following a California Public Utilities Commission (CPUC) investigation of compliance with its cellular tower siting regulations. The four firms (em Los Angeles Cellular Telephone Co., Mountain Cellular, GTE Mobilnet of California, and Bay Area Cellular (em had either failed to file applications for siting approval with the CPUC prior to construction or failed to obtain proper permits for construction from other governmental agencies.

Wisconisn Orders LDCs to Restructure Rates

By Phillip S. Cross

Gas local distribution companies (LDCs) in Wisconsin must provide unbundled balancing services for transportation customers at cost-based rates under new rules adopted by state regulators. The new rules came out of a Wisconsin Public Service Commission (PSC) investigation of LDC tariff changes required as a result of pipeline restructuring at the federal level.

The PSC ruled that balancing is required where an LDC is served by a pipeline with balancing provisions that contain penalties that default to the LDC, and hence to system sales customers.

TransCanada Adopts Poison Pill

Lori A. Burkhart

TransCanada PipeLines Ltd. has adopted a plan to encourage fair treatment of shareholders in event of a takeover offer. The plan addresses concerns that existing Canadian law does not allow enough time for the board or shareholders to properly consider a takeover bid. Under the plan, shareholder rights can only be exercised when a person announces the intention to acquire 20 percent or more of TransCanada's common shares without complying with the "permitted bid" provisions of the rights plan.

Rate Discounts Pave the Way for Restructuring

Phillip S. Cross

Much attention has been paid to revolutionary rate-reform plans advanced to meet perceived competition in energy markets. So much, in fact, that the increasing popularity of the special discount rate has gone virtually unnoticed.

New York Reviews QF Backup Service

By Phillip S. Cross

The New York Public Service Commission (PSC) has turned down a request to create a special rate for backup service to qualifying facilities (QFs) with dispatchable contracts. The PSC made the ruling while reviewing a request by Niagara Mohawk Power Corp. for permission to increase its rates for backup services provided to customers with onsite generation, primarily QFs. The utility had withdrawn the proposed rates, but only after the parties to the case claimed that the rate proposal was designed to kill competition, especially from smaller QF projects.

FERC's Santa Visits Canadian - Northeast

Lori A. Burkhart

At a November 11 conference, "Canadian-Northeast Energy Trade: New Issues and Challenges," sponsored by the New England-Canada Business Council, Commissioner Donald F. Santa, Jr.

Idaho PUC Split on QF Contract Buy-Outs

Phillip S. Cross

The Idaho Public Utilities Commission (PUC) has approved a Utah Power & Light Co. proposal to buy out a QF contract with Firth Cogeneration Partners Ltd., which the PUC found cost-efficient less than eight months ago. The utility said that the grandfathered avoided-cost contract rates were too high, and that lower-cost supplies were available from other sources.

While granting authority for the buyout, the PUC denied approval for accounting treatment and rate recovery of $4.4 million in cancellation fees suggested by the utility.

FERC Upheld on Municipal Preference for Hydro Licensing

By Phillip S. Cross

The U.S. Court of Appeals for the District of Columbia Circuit has upheld a Federal Energy Regulatory Commission (FERC) finding that the municipal preference in hydropower project relicensing cases did not apply to "orphaned" facilities. Facilities are considered orphaned if the current license holder files a notice of intent to apply for a relicense, but then fails to file a timely application.

DSM Programs Must Target Consumers, Not Just Technology

Renz Jennings, Martin Pasqualetti, Merrilee Harrigan, and Robert Boscamp

One of the great attractions of demand-side management (DSM) lies in its ability to accommodate one-stop shopping. In contrast to the traditional supply-side approach, DSM allows energy utilities to minimize price hikes and maintain environmental quality even while meeting increasing needs.

Nevertheless, some of the initial excitement has waned. For example, The Wall Street Journal reviewed 11 programs in late 1993 and found that 8 realized less than half their projected savings.

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