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Fortnightly Magazine - November 1 1996

Real-Time Pricing: Paying at the Margin

Scott L. Englander, John E. Flory, Leslie K. Norford, and Richard D. Tabors

Savings, yes. But some load-management

techniques may imply trade-offs in service

quality.By Scott L. Englander, John E. Flory,

Leslie K. Norford, and Richard D. TaborsAs facility manager for a large hotel, you browse your energy vendor's web site to view tomorrow's hourly prices. But it seems your computer (pc) has already done some browsing of its own. Since it's connected to your energy management system, your pc has already looked up the weather forecast and has logged on to the hotel's main computer to find out what rooms will be used.

Calif. Reviews LEC Cost Studies

Phillip S. Cross

The California Public Utilities Commission (CPUC) has approved a Total Service Long Run Incremental Cost (TSLRIC) study submitted by Pacific Bell, a local-exchange carrier (LEC), for use in pricing bundled and unbundled basic-service network offerings. The CPUC rejected similar studies submitted by GTE California, Inc., finding that the LEC had employed flawed methodologies and that the studies lacked adequate supporting data.

Frontlines

Bruce W. Radford

Three weeks ago I traveled to Indianapolis to Speak at the Indiana Energy Conference, a meeting sponsored by the Citizens Action Coalition and a board group from the local gas and electric industries, including a fair number of state government employees. Focusing on issues largely specific to Indiana, that audience gave the meeting a novel perspective: What's a low-cost state to do?

Do you fix it if it ain't broke?

Federal Court Dismisses Challenge to CTC

Phillip S. Cross

A federal district court in Massachusetts has ruled that it has no jurisdiction to hear a complaint brought by a qualifying cogeneration facility (QF) concerning stranded-cost recovery charges proposed by an electric utility and approved by the Massachusetts Department of Public Utilities (DPU). (For prior ruling approving the charge, see Re Cambridge Electric Light Co., 164 PUR4th 69 (Mass. D.P.U.

People

SCANA Corp. promoted William B. Timmerman, president, to COO. John L. Skolds, senior v.p. of generation at SCANA subsidiary South Carolina Electric & Gas, became president and COO. Skolds replaces Bruce D. Kenyon, who left the company to become president of Northeast Nuclear Energy Co.

James T. Egler was promoted from president of Equitable Resources Inc.'s marketing division to CEO of Equitable Gas Co., a regulated subsidiary.

Transcontinental Gas Pipe Line Corp. promoted Bob Bahnick to v.p., operations & engineering.

LDC Shares in Sale of Property

Phillip S. Cross

The Kansas State Corporation Commission (SCC) has authorized Western Resources, Inc., a local distribution company (LDC), to raise base rates by $33.85 million, but to refund to ratepayers a portion of its gain on the sale of distribution assets sold to a municipality.

Citing guidelines handed down by the state Court of Appeals in a 1980 ruling (5 Kan App.2d 514), the SCC approved a sharing mechanism that allocates ratepayers 44.4 percent of the gain over a one-year period.

Mailbag

Green Pricing Premium: Less than it Seems

I disagree with the idea that green-pricing programs with the lowest premiums prove the most popular with residential utility customers, as suggested by the article, "Green Pricing: The Bigger Picture" (Byrnes et al., August 1996, p. 18). And, to the extent that that notion comes from information presented about the SolarCurrents program at Detroit Edison (DE), which I manage, I offer some points in rebuttal.

First, the number of participants may prove misleading.

Large Users Benefit from PGA Reforms

Phillip S. Cross

The North Dakota Public Service Commission (PSC) has directed Northern States Power Co., a local distribution company (LDC), to eliminate three "nongas" cost components from its purchased-gas adjustment (PGA) clause: 1) gas transportation credits, 2) recovery of costs associated with certain interconnection facilities, and 3) tax credits resulting from the 1986 Tax Reform Act.

Joules

The Education/Electric Buying Group, which represents Long Island public schools, has asked the New York Public Service Commission (PSC) to separately consider its proposal for a competitive electric pilot program. The program calls for electricity purchased at the best price, rather than just through the Long Island Lighting Co. The buying group claims that LILCO has refused requests to discuss the proposal. The school districts estimate they could save $20 million annually in electricity costs without substantially affecting LILCO's net earnings.

Mass. Refines LDC Margin-sharing Plan

Phillip S. Cross

The Massachusetts Department of Public Utilities (DPU) has clarified an earlier ruling on sharing revenues that local distribution companies (LDCs) receive from certain interruptible services and capacity-release transactions. In that ruling, the DPU had established that LDCs could retain 25 percent of margins above a designated threshold. Re Interruptible Transportation/Capacity Release, D.P.U. 93-141-A , Feb.

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