Mergers & Acquisitions
CP&L + Florida Progress. Carolina Power & Light announced Aug. 23 that it would purchase Florida Progress Corp. for $5.3 billion in a combination that...
market-based rate requests from six utilities: Northeast Utilities, Duke Power, Western Resources, PacifiCorp Power Marketing, Wisconsin Public Service Co., and Cleveland Electric Illuminating Co. (Duke eventually received approval; Wisconsin Public Service later withdrew its tariff.) The main sticking point has been the FERC's contention that it cannot assume that a utility has fully mitigated its market power in transmission unless its open-access tariff substantially conforms to the pro forma version, or contains terms and conditions superior to the FERC tariffs.
More recently, in three cases, the FERC has denied requests for market-based rates for utility-affiliated power marketers because the utility tariffs restrict service to so-called "section 211/212 entities." (Federal Power Act sections 211 and 212, as amended by EPAct, pertain to certain wheeling authority enjoyed by the FERC in limited situations on behalf of wholesale power entities such as qualifying cogeneration and small power production facilities, rural electric cooperatives, public power utilities, the federal power marketing agencies, independent power producers, and investor-owned utilities.)
The FERC had accepted such restrictions in the past, but has now reversed itself without explanation. Possible reasons for this change in policy include the future submission of unbundled, retail transmission tariffs, and the many price and nonprice provisions in sections 211 and 212 that the FERC may consider too difficult to define or administer. A flurry of filings from utilities with market-based rate approval urged the FERC to remove the service restrictions for section 211 parties from the open-access transmission tariffs. In response, the FERC softened its policy to allow utilities that request market-based rates 15 days to conform to the pro forma tariffs.
The differences between the utility and pro forma tariffs illustrate the terms of the debate between utilities and customers concerning third-party use of a transmission system. The FERC's final open-access rule will directly address the issues raised by these filings, but debate will likely continue. t
Kevin Porter is a policy analyst at the National Renewable Energy Laboratory's Washington, DC, office.
Tariff Filings Discussed Here
Citizens Utilities ER95-1586-000
Cleveland Electric Illuminating ER95-1104-000
Commonwealth Edison ER95-1586-000
Commonwealth Electric ER95-1453-000
Duke Power ER95-0755-000 and ER96-0110-000
Florida Power Corp. ER95-1536-000
General Public Utilities ER95-0791-000
Idaho Power ER96-0350-000
Nevada Power ER96-0447-000
Northeast Utilities ER96-0496-000 and ER95-1686-000
Northern Indiana Public Service ER96-0399-000
PacifiCorp Power Marketing ER95-1096-000
Portland General Electric ER96-0333-000
Public Service of Colorado ER95-1268-000
San Diego Gas & Electric ER96-0043-000
Southwestern Public Service ER95-1138-000
UtiliCorp United Inc. ER95-0203-000
Western Resources ER96-0459-000 and ER95-1515-000
Wisconsin Public Service ER95-1528-000 and ER96-0439-000
1 Promoting Wholesale Competition Through Open-Access NonDiscriminatory Trans. Servs. by Pub. Utils., Dkt. RM95-8-000, and Recovery of Stranded Costs by Pub. Utils. and Transmitting Utils., Dkt. RM94-7-001, March 29, 1995, 70 FERC (pp 61,357.
Articles found on this page are available to Internet subscribers only. For more information about obtaining a username and password, please call our Customer Service Department at 1-800-368-5001.