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Fortnightly Magazine - May 15 1996


Aquila Power Corp., a UtiliCorp United subsidiary, has hired two executives to expand its market into the western United States. Timothy J. Culbertson, from Portland General Electric, will lead power marketing in the Pacific Northwest. David L. Metz will lead power marketing in the Southwest. Metz comes from Arizona Public Service Co.Consolidated Natural Gas Co. has named Bruce E. Plichta international financial analyst and James M. Mulcahy senior financial analyst.

Restructuring Case to Define "Cost-Based" Rate Standard

Phillip S. Cross

In opening its investigation of electric utility restructuring, the Utah Public Service Commission (PSC) has begun by directing PacifiCorp to submit a legal analysis of the "cost-based standard" for ratemaking, as enunciated two years ago in a state supreme court opinion.

In 1994, the court had overturned an incentive regulation plan OK'd by the PSC for a local exchange telephone carrier because it ignored statutory cost-of-service principles.


Genco Risk: "Location, Location, Location"Vinod Dar's recent article, "Competition, Convergence . . . and Cashflow? The Power Business in the Next 20 Years" (Apr. 1, 1996, p. 31), highlighted some of the risks inherent in investments in new power generation plants in a restructured electric industry.

N.Y. to Reexamine LEC Competition Pilot

Phillip S. Cross

The New York Public Service Commission (PSC) has decided to review its experimental "Open Market Plan" to introduce competition to the local telephone market in the Rochester, NY area.


Batavia, IL, (pop. 20,300) is studying a municipal broadband communications system that would provide high-speed data services for city businesses, homes, schools, and other customers. The system envisioned by city fathers would use a fiber-optic network extension of the municipal utility. The system would provide cable TV and telephone services, and provide a conduit for interactive data such as the Internet.

Montana Reserves Judgment on NGV Investment

Phillip S. Cross

The Montana Public Service Commission (PSC) has authorized Montana Power Co. (a combined electric and natural gas utility), to increase base rates for gas distribution by $3.01 million, subject to refund.

New York First With Full Local Gas Competition

Lori A. Burkhart

The New York Public Service Commission (PSC) on March 14 approved utility restructuring plans aimed at opening up the local natural gas markets to competition. Residential, small business, and commercial/industrial gas users now may purchase their gas supplies from a variety of sources, just as larger industrial customers may purchase from sources other than the local utility (Docket No.

Resource Plan Finds Shareholders Funding Low-income Programs

Phillip S. Cross

The Rhode Island Public Utilities Commission (PUC) has approved a plan by which shareholders of Providence Gas Co., a natural gas local distribution company (LDC), will fund existing low-income assistance programs. The PUC approved the plan as part of settlement agreement in a case involving a new integrated resource plan (IRP) for the LDC.

Funds for the low-income assistance programs will come from gas-cost savings earned by the LDC under new performance-based IRP reforms approved by the PUC.

New Study Finds Government Should Privatize TVA, PMAs

Lori A. Burkhart

The Reason Foundation, a public policy research organization, has issued a report, Federal Power: The Case For Privatizing Electricity, recommending privatization of the Tennessee Valley Authority (TVA) and the five power marketing administrations (PMAs).

Michigan Approves Foreign Investment Plan

Phillip S. Cross

The Michigan Public Service Commission (PSC) has approved a request for certification of plans by CMS Generation Co., a wholly owned subsidiary of CMS Energy Co., to acquire an interest in an electric power supplier in Australia, as part of that country's privatization program.

According to CMS Generation, the project will remain a "totally separate entity" from the corporate parent and its principal subsidiary, Consumers Power Co.