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News Digest

Fortnightly Magazine - January 1 2000

York, and Boston will serve as the New England headquarters for the combined company.

Northern States + New Century. A coalition of environmental groups on Nov. 1 filed a petition to intervene at the Minnesota PUC in opposition to the proposed merger between Minneapolis-based Northern States Power and Denver-based New Century Energies to form Xcel Energy. Concerned that the majority of both companies' power is generated by coal, the coalition believes that approval would weaken Minnesota's "progressive" regulatory treatment of NSP.

NEES + EUA. Regulators in Connecticut approved the merger of Eastern Utilities Associates into New England Electric System, thereby combining EUA's operating subsidiary, Montaup Electric Co., into New England Power Co., the operating subsidiary of NEES.

Each operating company is a minority owner in the Millstone Unit No. 3 nuclear plant, and each intends to eventually divest its ownership interest. Docket Nos. 99-08-11, Oct. 27, 1999 (Conn.D.P.U.C.).

Power Plants

New Generation Interconnections. The FERC denied rehearing on application procedures used by the PJM Interconnection LLC to decide on requests of third parties to interconnect additional generating capacity to the PJM grid and to establish cost responsibility rules for interconnection of new generation projects. Also included is PJM's method of establishing an initial queue for interconnection requests.

PJM had allowed prospective power producers to gain priority in the informal queue by demonstrating that they could have submitted an interconnection request earlier. In the future, however, PJM must base queue rights on a first-come, first-served protocol. Docket No. ER99-2340-001, Nov. 10, 1999 (F.E.R.C.).

Fossil Sales. The New Jersey board OK'd the sale of the non-nuclear assets of Jersey Central Power & Light Co. (doing business as GPU Energy) to Sithe Energies Inc. for $442 million, including GPU's 16.7 percent interest in the 1,170 MW, coal-fired, Keystone generating facility for $255 million, and GPU's New Jersey-based assets for $187 million.

The board also approved the transition power purchase agreement between GPU and Sithe, giving GPU the option to purchase contract capacity (call option) from Sithe at prices ranging from $69.60 per megawatt-day in 1999 to $120 per megawatt-day in 2002, and giving Sithe the option to require the company to purchase such contract capacity (put option) at prices ranging from $54.80 per megawatt-day in 1999 to $93 per megawatt-day in 2002. Docket No. EM99020067, Nov. 4, 1999 (N.J.B.P.U.).

Nuclear Divestitures. Connecticut Light & Power Co.'s divestiture plan for the Millstone nuclear station, filed Nov. 9 with the state commission, calls for auctioning all three nuclear units in the same package. As part of the divestiture process, NU hopes to transfer decommissioning responsibility for all three units to the new owner. Following regulatory approvals, NU would hold the auction early in 2000, with a successful bidder chosen by summer of 2000.

Emissions Lawsuit. The federal government on Nov. 3 filed lawsuits against seven investor-owned utilities that own coal-fired plants, alleging that they have illegally polluted the air by upgrading their coal-fired generating plants without adding required emission controls as required by the Clean Air Act of 1970. The Environmental Protection Agency and the Justice Department