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Fortnightly Magazine - October 1 1996

Mailbag

Chairman Miller's prediction that consumers and not producers will set future electricity prices is correct, assuming a competitive market. His observation (em that "states that move decisively to a competitive environment and that clear their decks of the debris of electricity companies' stranded costs as quickly as possible will be the winners" (em is equally correct. But estimates of stranded investments range from $20 to $500 billion. Who will pay to clear those "decks"?

Muni Can't Skim Cream in Annexed Area

Phillip S. Cross

The Utah Supreme Court has ruled that a municipal utility must serve all customers in new areas that it takes over by annexation (em not just a select few.

Moreover, the city must compensate the former supplier of utility services for any dedicated facilities, even if it uses its own municipal facilities to serve the new area. However, the city will owe compensation for lost profits only if the municipality fails to obtain the prior consent of the supplier or to pay for the cost of the associated facilities.

Joules

The U.S. Department of Energy (DOE), in a report analyzing the July power outage in

14 Western states, notes that New England is "challenged" by the shutdown of 3,000 Mw of nuclear capacity in Connecticut. The mid-Atlantic will be likewise challenged over the coming years by delay in the construction of a 765,000-volt transmission line between West Virginia and Virginia.

UtiliCorp United amended an electric-supply contract with Public Service Co. of Colorado to reduce electric costs for 78,000 electric customers by as much as $1 million a year.

PUC to Hear Complaint by Customer's Employees

Phillip S. Cross

The Maine Public Utilities Commission (PUC) has agreed to hear a complaint by employees of an industrial customer of Central Maine Power Co. (CMP). The employees allege unfavorable pricing actions against their employer, Yorktowne Paper Mills, including denial of service at the requested voltage. The complaint asks for reparations for prior overcharges.

Maine Drafts Restructuring Plan

Lori A. Burkhart

The Maine Public Utilities Commission (PUC) has released for comment its Draft Plan on Electric Industry Restructuring, which would allow all retail customers to choose their generation supplier beginning in January 2000. The draft permits customers to aggregate, and does not require reciprocity based on retail access in other states or Canada.

Investor-owned utilities (IOUs) would have to structurally separate generation by January 2000, and divest all generation assets by January 2006.

Ohio Won't Bar Resale of Service<

Phillip S. Cross

The Ohio Public Utilities Commission (PUC) has reaffirmed an order issued on May 8 in which it struck down a tariff proposed by Toledo Edison Co. that would have barred resale of service by commercial customers. The PUC rejected allegations by Toledo Edison that the ruling constituted a breach of its duty to regulate electric service to end users. It declined to regulate disputes that it characterized as occurring between landlords and tenants, where the landlord is not operating as a public utility. See, Brooks, et al. v. Toledo Edison Co., Case No.

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