THE POWER PLANTS OF AT LEAST FIVE UTILITIES IN NEW England and California get swapped this year for more than $5.3 billion. And happily, those holding bonds on the plants will be given cash for...
PSC - Restructuring Orders
PLANS OK'D for electric IOUs under New York's Competitive Opportunities docket.
CENTRAL HUDSON GAS & ELECTRIC CORP. RETAIL CHOICE: Offered to 8 percent of total load in 1998; additional 8 percent each year; choice for all by July 1, 2001. SAVINGS: $10.5 million to fund 5-percent rate cut for large industrials; all other rates frozen (since 1993) through June 30, 2001. Earmarks $24.5 million for incentives for residential, commercial and small industrial classes. Generation backout rate is highest among IOU restructuring plans. DIVESTITURE: Must auction fossil generation by June 30, 2001. Company receives 5 percent of gross proceeds up to net book value, even if sale at a loss, plus 10 percent of gross proceeds above net book value, subject to $17.5 million cap. RETURN ON EQUITY: All earnings above 10.6 percent return on equity go to customers. OTHER: $3.5 million for system benefits (efficiency, environmental protection) for first 3 years of plan. See, Case 96-E-0909, Feb. 19, 1998 (N.Y.P.S.C.).
CONSOLIDATED EDISON OF NEW YORK, INC. RETAIL CHOICE: Begins June 1, 1998, for 500 MW of load; up to 1,000 MW by April 1, 1999; additional 1,000 MW by April 1, 2000; full implementation by Dec. 31, 2001, or when state achieves full operation of independent system operator, whichever comes first. SAVINGS: Immediate 25-percent rate cut for large industrial customers with monthly demand above 1,500 kW; 10-percent for commercial and general service customers (+1,500 kW) over 5 years; 10-percent for residential and small business by end of fifth year. Prior rate increases waived. Total savings between $1 billion and $1.5 billion over 5 years. DIVESTITURE: Company to sell at least 50 percent of in-city generating capacity; process was to begin by mid-April for 30 percent within 90 days. (Sell-off plan OK'd, Jan. 14, 1998, Case 96-E-0897, 183 PUR4th 159.) RETURN ON EQUITY: Approves 10.9 percent, with sharing of excess earnings triggered at 12.9 percent. OTHER: Plan expands company's Business Incentive Rate, making 65 MW available at reduced rates to encourage businesses to locate in ConEd's service territory. See, Case 96-E-0897, Opinion No. 97-16, Nov. 3, 1997 (N.Y.P.S.C.).
NEW YORK STATE ELECTRIC & GAS CORP. RETAIL CHOICE: Begins Aug. 1, 1999 for all customers. SAVINGS: Large industrials get 5-percent annual rate cuts over 5 years. Rates frozen for residential and small commercial classes for 4 years, with 5-percent cut in fifth year. Overall customer savings put at $725 million ($522 million from foregone rate increases). Generation backout credit equals 3.23 cents per kWh through July 31, 2000; 3.47 cents until July 31, 2001; then 3.71 cents through end of settlement. DIVESTITURE: Company must sell its coal-fired generating plants by multi-round auction process by Aug. 1, 1999. Proceeds above book value will mitigate nuclear stranded costs; company may retain 20 percent of gain from renegotiation and/or termination of above-market purchased power contracts. RETURN ON EQUITY: Earnings above 9 percent return on equity trigger sharing with ratepayers. Cap imposed at 12 percent (all excess earnings go to customers). OTHER: Includes about $40 million in funding for system benefits charge for energy efficiency and public policy