Hold on to your hats. The vaunted and vilified “standard market design”, once thought dead and buried, has been resuscitated, with all attendant chaos and rhetoric, but this time in the guise of a...
It's August again. In Washington. Anyone with any sense is looking to get out of town and hole up at the beach. Anyone, that is, except a magazine editor.
When I wrote this column on July 11, Rep. Dan Schaefer (R-CO) had just concluded a news conference to announce his "Electric Consumers' Power to Choose Act of 1996." Reams of testimony were pouring in, demanding to be read. Faxes arrived nonstop all afternoon with offers from experts to provide comments, quotes, or some unique spin on the day's events. My desk became nearly submerged.
Only two days before, I had survived the filing deadline for the pro forma transmission tariffs at the Federal Energy Regulatory Commission (FERC). That wasn't too bad. After all, nearly two-thirds of the transmission-owning electric utilities had already filed open-access tariffs by April 24, when the FERC released Order 888. But come the next Monday, July 15, reply comments would fall due at the FERC in the California Power Exchange docket. Somewhere in between would come a host of petitions for rehearing or clarification of FERC Order 888. And if that wasn't enough, August promised the first round of written comments in the FERC's new rulemaking on its proposed capacity reservation tariff (CRT). By the way, the FERC predicted a paperwork burden of 250 hours per utility for the CRT rulemaking, or 41,500 hours of work for all the 166 utilities (give or take a few) that own, operate, or control electric transmission facilities. (At $300 an hour, that's over $12 million worth of comments.)
All in all, these past few weeks have seemed very much like a triple witching hour on Wall Street. Each new deadline brings something else to read, whether by courier pouch or FedEx envelope. The summer will have to wait. The blizzard of paper knows no season.
Taming the Beast
In terms of sheer volume of paper, the worst offender of the summer turned out to be the Report on Horizontal Market Power, prepared in FERC Docket No. ER96-1663-000 on behalf of Southern California Edison Co. and San Diego Gas and Electric Co. by Professor Paul L. Joskow (M.I.T.) and Rodney Frame (National Economic Research Associates), with assistance from Dr. William Hieronymus (Putnam, Hayes & Bartlett).
I had wanted to get my hands on that report after the American Public Power Association sent me several sets of comments criticizing its conclusions and suggesting that the FERC should treat the proposed California Power Exchange more or less as a work in progress (em an "experiment subject to continuing review" (em rather than a real solution for organizing a competitive market for bulk power. So, when I couldn't find the report on the Internet, I called Edison's Washington, DC, liaison office to ask for a copy.
When it finally landed on my desk, the report was so big I promptly took it into the mail room to weigh it. (Two pounds, nine ounces!) On the cover was a note from my good friend Gloria Quinn from Edison's corporate communications department: "Bruce, I think you were