[BETA] Fortnightly

Forty percent of 42 state public utility commissions (PUCs) expect electric utilities to unbundle generation from transmission and distribution within the next one to five years, according to a survey conducted for the Electric Generation Association (EGA) by Boston Pacific Co. EGA did not indicate whether the survey went out before or after March 29, when the Federal Energy Regulatory Commission (FERC) issued its Notice of Proposed Rulemaking on transmission access and stranded investment, which of course would require functional (but not structural) unbundling of generation and transmission.

The EGA claims its survey suggests broad support for electric competition, but that market structures are not yet in place to afford a soup-to-nuts repeal of the Public Utility Regulatory Policies Act. The Edison Electric Institute disagrees. David Owens, senior v.p., says "competition is real:" "EGA is misguided in believing that because states are not looking at unbundling and wholesale transmission, that competition is not increasing."

Copies are available from EGA (202-965-1134).

Bruce W. Radford is editor of PUBLIC UTILITIES FORTNIGHTLY.

The California PUC on April 26 issued interim rules that could allow local telephone competition in the Pacific Bell and GTE-California service areas as early as June. The rules would manage competition between competitive local carriers (CLCs) and franchised local telcos.

The rules would allow CLCs to offer individual service components (such as subscriber loops, line side ports, signaling links, signal transfer points, service control points, and dedicated channel network access connections) or choose to handle the entire phone call.

Some long-distance carriers and cable television firms may also vie for local phone customers. (EM L.B.

The FERC on April 26 made final its rule whereby electric utilities may recover the cost of trading Clean Air Act emissions allowances incurred when selling power at wholesale, telling utilities they can require wholesale customers to furnish information on how the allowances will be paid for (DOCKET NO. PL95-1-001).

The purchaser must declare at the beginning whether it will pay for or replace emissions allowances. But the buyer need not replace allowances before the seller's own deadline to meet EPA allowance requirements. (EM L.B.

Texas Utilities Electric Co. (TUE) and Gulf States Utilities are looking to an April 13 Texas Supreme Court decision (involving GTE-Southwest) that said the state PUC need not employ the actual taxes paid method in setting utility rates.

Gulf States will now amend its appeal of a March 20 Texas PUC order forcing a $52.9 million rate reduction, which had included a $25.8 million actual taxes paid component.

Texas Utilities had put its faith in legislative relief, but saw its hopes dashed in late April when a Texas state senate committee defeated a proposal to take up the matter. Under the actual taxes paid method, TUE could have to pay the IRS up to $1.3 billion, and lose up to $100 million annually of accelerated tax depreciation. (EM L.B.

The Columbia Gas System, Inc., and its principal pipeline subsidiary, Columbia Gas Transmission Corp. (CGT) have filed separate reorganization plans with the U.S. Bankruptcy Court for the District of Delaware.

The parent company's