generation market. "We will be able to transfer 3,772 megawatts of West Penn's generating assets to the unregulated genco," said Michael P. Morrell, AE senior vice president and chief financial officer.
The settlement requires that 75 percent of the savings achieved from the bond sale be passed through to West Penn's customers, by reducing the competitive transition charge. The transition bonds will be supported by an intangible transition charge that will replace a portion of the competitive transition charge.
PNM Spin Down. Public Service Co. of New Mexico on Nov. 17 petitioned the New Mexico PRC to allow it to split its company into two subsidiaries under a newly organized holding company, with one subsidiary to operate the company's electric and gas utility and the other its generating plants, power marketing business and competitive activities.
A state law requires utilities to separate transmission and distribution operations from their generation and power marketing activities. The PNM name and logo will stay with the regulated utility subsidiary.
Hostile Takeovers. Ohio governor Bob Taft signed into law utility anti-takeover legislation requiring the state PUC to investigate any hostile takeover bid directed at an Ohio natural gas utility at the time the bidder's tender offer is made. To view House Bill 452, go to http://www.legislature.state.oh.us/.
Gross Receipts Taxes. Pennsylvania electric utilities saw their gross receipts taxes jump by 19 percent, effective Jan. 1, under revenue-neutral reconciliation provisions in the state's 1996 electric competition law.
Each utility must decide whether to pass the increase on to customers. PECO Energy has asked the Pennsylvania PUC to allow it to exceed its present rate cap, but other utilities are undecided as to whether to pass on the increase.
Capacity Solicitations. In a preliminary resource plan filed at the state PUC on Nov. 15, Public Service Co. of Colorado forecasted a need for an additional 1,031 MW of electricity between 2002 and 2004 (214 MW in 2002, 392 MW in 2003 and 425 MW in 2004). It said it would meet those needs by asking for outside competitive bids.
"We hope to attract as many outside wholesale electricity suppliers as we can, to submit bids to provide us with the 1,031 MW needed to serve the growing needs of our market, both before and after customer choice begins," said Fred Stoffel, PSCC's managing director of regulatory administration. "By 2006, Public Service and its affiliates would own less than 50 percent of the power supply that is available to serve our markets." It presently generates about two-thirds of its electric needs and buys the other one-third.
The utility's parent company, New Century Energies, and its proposed merger partner, Northern States Power, agreed to refrain from bidding, and all related subsidiaries will not bid. The proposal also calls for the utility to invest in more wind generation and more demand-side management measures. The utility plans on entering into 10-year supply contracts.
Overseas Sales. A subsidiary of AES Corp. has completed the acquisition of the 3,960 MW, coal-fired Drax power station in Yorkshire, England, from National Power for