Although problems in the power business grabbed the headlines early this decade, the industry now seems fundamentally strong. In contrast to their ratings of banks, rating agencies appear to have...
expect no layoffs, and say the move does not necessarily indicate an eventual merger of nuclear operations into one company.
NUCLEAR WASTE DISPOSAL. In a letter written to DOE Secretary Bill Richardson, 68 state utility regulators from 24 states have called for deferral of $6.5 billion in payments made by nuclear-owning utilities into the Nuclear Waste Fund until the Department of Energy provides disposal services. Specifically, the regulators said that DOE should limit annual payments to uses appropriated by Congress. Payment of the unappropriated portion of the fee - 84 cents on the dollar - would be deferred until DOE fulfills its obligation to remove nuclear waste from power plants. Earnings on accumulated deferred payments exceeding the U.S. Treasury rate would be retained to benefit electric consumers at the direction of individual states.
"By keeping these payments out of the U.S. Treasury, we stop Congress from spending the unappropriated portion on other things," said Minnesota commissioner Kris Sanda. "This would preserve the equivalent of $90 million of waste disposal funding for each of the 73 power plants from which nuclear waste must be removed."
MIDWEST SPIKES, TAKE ONE. Testifying on Sept. 24 before the Senate Committee on Energy and Natural Resources, and seeing no reason for alarm or a drastic shift in policy, Federal Energy Regulatory Commission chairman James Hoecker delivered a staff report on the power price spikes seen in the Midwest last June, attributing much of the cause to simple inexperience. Said Hoecker: "The team did not find evidence that firm service was compromised anywhere in the Midwest during the period of pricing abnormalities." Even so, he warned that Midwest summer peak demand had grown substantially and that "additions of new generating capacity have not kept pace."
MIDWEST SPIKES, TAKE TWO. The California Power Exchange Corp. has released a white paper, Defaults and Counterparty Risk in Electricity Wholesale Markets, prepared with Arni Petersson of Economic Insight, Inc., arguing that California was largely spared during last summer's Midwest price spikes because the PX minimizes counterparty risk inherent in bilateral trading. For copies contact Edward Freudenburg, at (626)537-3155, firstname.lastname@example.org, or download at the PX internet site at http://www.calpx.com ("About the PX").
News Digest is compiled by Lori A. Burkhart and Phillip S. Cross contributing legal editors, and by Beth Lewis, editorial assistant.
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