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Electric Transmission: Jury Still Out on Flow-Based Pricing

Fortnightly Magazine - June 15 1997

U.S. Department of Energy.

7But see, Enova Corp. & Pacific Enterprises, FERC Docket No. EL97-15-000, April 30, 1997 (suggesting that the FERC take jurisdiction over holding companies under its merger review authority), reported in this issue, p. 37.

8Reproduction cost, taken from Handy-Whitman indices.

9For "firm" service (minimum term of one year) the fixed reservation charge would reflect changes in line loadings relative to the annual system peak. Prices for "priority nonfirm service" would reflect changes in line loadings relative to the next day's peak demand. Prices for "standard nonfirm service" would be based on actual, real-time line loadings, plus any incremental service already scheduled for the next hour.

10TAPS is chaired by Roy Thilly, g.m. and counsel for Wisconsin Public Power Inc. System, and include other municipal and publicly owned utilities, represented by the Washington, D.C., law firm Spiegel & McDiarmid.

11Tex-La Elec. Co-op. of Texas, Inc., 69 FERC ¶ 62,034 (1994).

12According to TAPS, the Texas PUC in its recent open-access transmission rulemaking adopted a new transmission pricing method establishing regional rates by which 70 percent of transmission costs (apart from losses) would be recovered under a postage-stamp rate, and only 30 percent under a megawatt-mile approach.

13"[The] differences are in some cases significant, and perhaps irreconcilable. For example, Dominion's flow-based pricing scheme would include a "counterflow credit" as transmission line capacity is loaded and unloaded ... The pricing method proposed by MAPP, on the other hand (which Otter Tail has opposed) would not differentiate between positive and negative flows and therefore provides no corresponding credit."

14Allegheny Power Service Corp., et al., Docket No. ER97- 697-000, March 25, 1997, 78 FERC ¶ 61,314.

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