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Fortnightly Magazine - February 15 1995

Ariz. Telcos Lose Monopoly Hold

Lori A. Burkhart

The Arizona Corporation Commission has opened local telephone service to competition. The transition from monopoly service to a structure of managed competition is expected to take six months. The rules allow cable television companies, fiber-optic network owners, and other utilities to seek authority to provide business and residential dial tone in competition with the present local exchange monopoly provider.

Court Remands Mass. Ruling on Externalities

Phillip S. Cross

The Massachusetts Supreme Court has vacated and remanded a Massachusetts Department of Public Utilities (DPU) decision on environmental externalities, agreeing with Massachusetts Electric Co. that the DPU had no authority to require electric utilities to select new power sources based on externality values that encompass costs ratepayers otherwise would not incur.

UtiliCorp Throws Down the Gauntlet

Lori A. Burkhart

UtiliCorp United has announced a growth-oriented strategy that will introduce free-market concepts such as supplier choice and low-cost pricing to customers across the United States.

According to UtiliCorp chairman, president, and CEO Richard C. Green, Jr., the utility plans to use future mergers and partnerships to bring competitively priced energy products and services to consumers nationwide.

California Prods Local Telephone Competition

Phillip S. Cross

The California Public Utilities Commission (CPUC) plans to issue interim rules in June 1995 allowing competitors to seek authority to offer local telephone service in the state. (The CPUC also recently completed a plan to open the "local toll" market to competition.) The CPUC directed all interested parties to seek a settlement of the issues arising under its plan to move the local market to full competition by 1997.

Southwest Intertie Gets the Go-ahead

Lori A. Burkhart

Idaho Power Co. (IP) has received approval from the Bureau of Land Management to proceed with its proposed 500-mile, 500,000-volt transmission line between Idaho and Nevada (em the largest transmission project presently under development in the United States. The Bureau based its decision on the environmental impact statement for the Southwest Intertie Project (SIP), and has granted IP a right-of-way across public lands in Idaho, Nevada, and Utah. The line will link 14 utilities in the Southwest and California. IP plans to retain 20 percent of the line's 1,200-megawatt capacity.

AT&T and Others to Provide Local Service in New York

Phillip S. Cross

The New York Public Service Commission (PSC) has approved comprehensive rate and service tariffs enabling AT&T Communications of New York, Inc. (AT&T) and Frontier Communications of Rochester, Inc. (Frontier) to provide local telephone services in the Rochester, NY, service area. The PSC expects to approve a third set of tariffs for Time Warner AxS of Rochester, L.P. early this year. The new tariffs will allow telephone customers in the Rochester area to choose between the three new market entrants and the existing local carrier, Rochester Telephone Corp.

NY Accepts Vertical Disintegration

Lori A. Burkhart

Finding the present industry structure incompatible with effective wholesale or retail competition, the New York Public Service Commission (PSC) has issued for comment a set of regulatory principles designed to guide the transi-tion to a more competitive electric industry (Docket C94E0952/94086). It said that the transition requires vigorous fair trade safeguards and forward-looking labor/management relations.

Wisconsin Approves Performance Incentive Mechanisms

Phillip S. Cross

While lowering current rates for electric gas and water services provided by Wisconsin Power & Light Co., the Wisconsin Public Service Commission (PSC) has also approved a series of gas and electric incentive mechanisms for the utility.

The ratemaking modifications include a natural gas procurement incentive that works through the company's adjustment clause and includes a link to spot commodity prices for gas supply as well as a sharing mechanism to allocate the risk of cost changes between ratepayers and shareholders.

Perspective

Richard A. Abdoo

Our industry stands at the threshold of significant change. Competitive forces and significant technological advances beckon the nation's electric utilities to step forward. The electric industry has the opportunity to create a future that provides the benefits of competition to all customer groups. If we don't restructure, someone else will do it for us.

Idaho Seeks Improvements in LEC Regulatory Plan

Phillip S. Cross

The Idaho Public Utilities Commission (PUC) has decided to continue its five-year-old revenue sharing plan for U S WEST Communications, a local exchange telephone carrier, for one year. It initiated a workshop to develop a new regulatory plan for the carrier, and also proposed specific quality-of-service standards and penalties due to a recent decline in service quality.

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