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News Digest

Fortnightly Magazine - February 1 1998

government tax policy. The report explained that deregulation has already affected several municipalities which depend on tax revenue from investor-owned utilities owning nuclear plants, and in once instance, an oil- and gas-fired generating plant.

R&D Portfolios. The President's Committee of Advisors

on Science and Technology released a report that reviewed the current national energy R&D portfolio. Federal Energy Research and Development for the Challenges of the Twenty-First Century noted that the country needs to improve energy technologies, emphasizing a need for more R&D to reduce carbon-dioxide emissions and oil exports.

State PUCs

PECO Rate Plan. The Pennsylvania PUC approved a restructuring plan for PECO Energy Co., rejecting both (1) a proposal by Enron naming itself as the default provider of electric power for all PECO customers and (2) a partial settlement plan signed by the utility and many other parties. Unlike the settlement proposal, which would have guaranteed consumers a 7-percent rate reduction for 28 months, the new PUC plan relies on competition to reduce rates, with no guaranteed savings. The commission estimated, however, that the average electric user initially will save 15 percent. Under the plan, one-third of PECO's customers will have choice of suppliers by Jan. 1, 1999, with all customers eligible by 2000. PECO will be allowed to collect $5.5 billion in stranded costs over an 8.5 year period through a separate "competitive transition charge" applied to all users of PECO's distribution and transmission system. Docket Nos. r-00973953 and p-00971265, Dec. 11, 1997 (Pa.P.U.C.).

Slamming Rules. New York directed electric utilities parti-

cipating in a new retail access pilot program to institute procedures to guard against slamming (em switching a customer's energy supplier without permission. The PSC also ruled that the utilities must implement specific customer notification and verification rules. Case 96-e-0948, Sept. 18, 1997 (N.Y.P.S.C.).

Natural Gas Rates. The Indiana Utility Regulatory Commission approved a new natural gas alternative regulatory plan for Northern Indiana Public Service Co. The performance-based rate mechanism is coupled with a retail-access program to allow up to 20 percent of the company's gas customers to choose another supplier. Re Northern Ind. Pub. Serv. Co., December 29, 1997, Case No. 40342, Oct. 8, 1997 (Ind.U.R.C.).

Retail Electric Choice. The Maryland commission

ordered a two-year phase-in of retail competition in the state's electric industry, beginning April 1999. While the commission had rejected retail wheeling in a 1995, it said retail competition will provide greater benefits to consumers than wholesale competition alone. Nevertheless, the commission convened a statewide roundtable to develop price-protective measures to insulate consumers during the transition to competition. It also ruled that the state's electric utilities will be given the opportunity to recover prudently incurred stranded costs. Case No. 8738, Order No. 73834, Dec. 3, 1997 (Md.P.S.C.).

Green Pricing. The New Mexico PUC approved a proposal by Public Service of New Mexico to purchase power from a proposed 100-megawatt gas-fired turbine generator. In return, the utility agreed to participate in the Department of Energy's Global Climate Challenge program, to purchase 5 MW of solar power generation resources and to develop a cost analysis for