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Special Report

Fortnightly Magazine - September 15 1999

form, is still a radical bill," the governor was quoted in press materials as saying. "We have not been able to find a bill passed by another state that goes so far."

Yet energy companies may not need to worry about being sued frivolously. On July 20 President Bill Clinton signed into law H.R. 775. The "Y2K Act," as it is known, limits lawsuits in cases resulting from the Y2K problem.

"Responsible companies fear that they will spend millions or more defending Y2K suits, even if they bear little or no responsibility for the harm alleged," said the president in a press statement. "Frivolous litigation could burden our courts and delay relief for those with legitimate claims. Firms whose productivity is central to our economy could be distracted by the defense of unwarranted lawsuits."

The president continued, "In addition, the Y2K Act expressly exempts Y2K actions involving private securities claims arising under the Securities Act of 1933 and other federal securities laws that do not involve actual or constructive awareness as an element of the claim."

US WEST: Nagging Concerns

Bill Riddle, senior practice director at Oracle, who has worked on-site and seen utilities' Y2K efforts firsthand, said executives at the largest utilities should sleep well. Utilities early on recognized the great financial risks of Y2K problems, he said.

"Utilities moved much quicker than I am used to utilities moving," said Riddle. "Most of Southern Co.'s subsidiaries use Oracle. Southern must have been working on updating its systems for a period of two to four years."

Notwithstanding Riddle's confidence in utilities' Y2K-readiness, utility executives at the NERC conference expressed concern about issues both within and out of their control. The executives discussed with customers their contingency plans and the last series of Y2K drills-both issues well within their control. But they also spoke of hiring security forces to protect against possible sabotage by New Year's Eve crazies.

Their biggest concern, said executives, was the possibility of losing telecommunications.

Satellite phones, cellular phones and walkie-talkies are being tested, checked and rechecked by utilities, according to a NERC official. But the utility executives were skeptical that the phones would be working on New Year's day. They said downed phones could force plant shutdowns due to the lack of information on the status of the transmission grid.

A representative of US WEST at the conference argued that telecom companies can't guarantee phone service for the same reasons electric utilities can't guarantee power today or during the Y2K rollover. But he pledged that his company was doing everything possible to make sure the telephones work come 2000.

The last dress rehearsal for the utility industry is scheduled for Sept. 8 and 9. By that time, the industry will have practiced using backup communications and organized itself for the real event.

Richard Stavros is senior editor at Public Utilities Fortnightly.

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