Keywords

Public Utilities Reports

PUR Guide 2012 Fully Updated Version

Available NOW!
PUR Guide

This comprehensive self-study certification course is designed to teach the novice or pro everything they need to understand and succeed in every phase of the public utilities business.

Order Now

Fortnightly Magazine - November 15 1996

Stranded Cost Recovery: All FERC'ed Up

Michael T. Maloney, Robert E. McCormick, and Chad A. McGowan

Stranded-

Cost

Recovery: All FERC'ed Up

By Michael T. Maloney, Robert E.

McCormick, and Chad A. McGowan

The "lost-revenues" approach in Order 888 ignores the fact that cash flow drives

asset valuation . . .

. . . the key to measuring uneconomic investment.

Industrial Customer Can Choose Subtransmission

Phillip S. Cross

The Maine Public Utilities Commission (PUC) has ruled that Central Maine Power Co. acted in a discriminatory manner when it refused to grant a request by a large industrial customer, Yorketowne Paper Mills of Maine, to rate classes to time-of-use subtransmission.

The case was notable since the customer's employees had filed a complaint alleging improper denial of service and seeking reparation for overcharges. See, Yorketowne Paper Mills of Maine, et al. v. Central Maine Power Co., 170 PUR4th 535 (Me.P.U.C.1996).

The Road to Legislation

The California legislature had taken an interest in electric restructuring from early on in the debate. Through policy committees of the Assembly and Senate, it had signaled that the CPUC would need the blessing of the lawmakers before it would be allowed to pursue the ideas spelled out in the commission's Final Policy Decision. Moreover, the December 1995 decision had drawn a divided reaction. Some parties had sought relief from the outcome of the December 1995 order.

Maine PUC OKs Hannaford Deal

Phillip S. Cross

The Maine Public Utilities Commission (PUC) has OK'd a much-publicized special rate agreement between Central Maine Power Co. and one of its large customers, the Hannaford Brothers Co., which operates supermarkets.

Nevertheless, the PUC declined to order the utility to offer similar rates to Hannaford's competitors in the supermarket business. It advised that it cannot attempt to equalize electric rates among business competitors, or to reduce advantages that large businesses have over smaller businesses.

Frontlines

Bruce W. Radford

About a year ago I stuck my neck out to predict that electric utilities might end up with stranded investment in transmission lines. I suggested that financial commodities trading-longs, shorts, and hedges-might supplant physical product movements. It's happened in natural gas, where the interstate pipelines have suffered from "decontracting" and capacity "turnback"-a phenomenon that has tended to move from West to East.

N.Y. Allows Gas Submetering for C&I Customers<

Phillip S. Cross

The New York Public Service Commission (PSC) has granted a series of waivers from its existing ban against the submetering of gas service to commercial and industrial (C&I) customers in the state. The waivers will allow GCT Venture, Ltd. to submeter gas service to approximately 25 food vendors renting facilities and space within the real estate firm's proposed redevelopment of the grand Central terminal in New York City.

The PSC observed that gas submetering was prohibited because of safety considerations, especially in cases of residential service.

People

The Nuclear Regulatory Commission has a five-member slate for the first time in over three years. Recently sworn in were Nils J. Diaz and Edward McGaffigan, Jr. Diaz was a professor of nuclear engineering sciences at the University of Florida; McGaffigan, a former foreign service officer, was a senior science and defense advisor to U.S. Sen. Jeff Bingaman (D-NM). William T. Russell, NRC director of nuclear reactor regulation (NRR), retired September 30. Frank J.

Conecticut OKs Wholesale Telco Rates

Phillip S. Cross

The Connecticut Department of Public Utility Control (DPUC) has set rates charged by Southern New England Telephone Co. (SNET) for service elements for local exchange carrier (LEC) services provided at wholesale to new competitors in the LEC market.

It identified the Total Service Long Run Incremental Cost (TSLRIC) method as the starting point for its ratemaking decisions, but rejected arguments by several parties to employ TSLRIC without any further contribution to joint and common costs.

Joules

Entergy Corp. signed a letter of intent to acquire National Security Service, a security monitoring company that operates in North Carolina and Alabama. Entergy claims the acquisition places it among the top alarm companies in the country.

K Energy, Inc. has begun "Simple ChoiceSM" (em energy, communications, and "infotainment" services in one package, paid with one bill.

Gas Transport Available for Low-income Customers

Phillip S. Cross

A settlement agreement approved by the New York Public Service Commission (PSC) for National Fuel Gas Distribution Corp. "would attempt to institute" a gas transportation program on behalf of low-income residential gas users.

The agreement also allows the utility to increase its rates by 2.2 percent in equal increments over a two-year period and provides for an equal sharing between the company and its ratepayers of earnings in excess of a 12-percent return on common equity.

Pages