Will a back-to-basics strategy meet investor expectations?
It's an issue that is coming to the fore with greater force-the debate over...
Electric Power, Consumers Energy, FirstEnergy, and Virginia Electric & Power Co. But the partners still have not found a way to win approval from the FERC, as the commission again ruled on May 17 that the Alliance transco would fail to satisfy the test for "independence" under the latest proposal, which would have had each of five member utilities owning a 5 percent equity share in the new Alliance stand-alone transmission company.
This move by Detroit Edison appears to be more than just a prequel to an Alliance RTO. In its application, filed by private counsel Clifford Sikora and Michael Sweeney Jr. of Truman Sanders LP, Edison says the transfer deal could serve as a springboard for any number of deals, including "one or more public or private offerings." It sees the deal as beneficial to Michigan consumers, since the state is a "classic load pocket," which suffers from "limited" grid links with utilities located in neighboring jurisdictions. By divesting transmission, says Edison, Michigan consumers should draw benefits as the ITC enjoys a greater incentive to invest in and expand the transmission grid.
And, as Edison says, the utility would be a hybrid, operating "solely as a generation and distribution company."
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