Using scenario analysis to help utilities map out their strategies.
Doug Buresh and Gary L. Hunt
If you were a utility executive today would you consider building a new nuclear power plant? What if the United States decided to implement the emission reductions called for in the Kyoto Protocol without adopting it? How might your business be affected by another 9/11-scale terrorist attack on a U.S. target? What would be the impact of growing reliability problems in key U.S. power markets? Some utility executives are asking themselves just such questions.
The North American Electric Reliability Council should be promptly certified as America’s electric reliability organization.
To create the strong electric reliability system envisioned by Congress, FERC needs to focus on many issues, two of which are especially important: creating consistency in how compliance and enforcement programs are carried out at the regional level, and leading the transition—effectively and promptly—from today’s world to the new era called for in EPACT.
A review of total shareholder returns shows how growth and merger strategies drove performance last year.
Dean C. Maschoff, Thomas F. Read, and Jason K. D’Souza
To better understand the performance of the electric utility sector from both a short-term and long-term perspective, we examined the total shareholder return (TSR)—dividends plus change in stock price—of 58 electric companies for 2005 and for three- and five-year periods. We grouped these companies into four categories to better understand the impact of alternative strategies on investor performance: Recovering, Traditionalist, Growth, and Merger.
Benefits and drawbacks of the most popular estimation methods or modeling techniques.
Before we go about trying to value natural-gas storage, we should try and come up with a list of important considerations in any valuation process. Also, the data requirements should be modest, and the calculation time should be reasonable. But not all gas storage valuations are created equal.
Incentives for transmission investment could boost postage-stamp pricing over license-plate rates.
Bruce W. Radford
FERC proposed a new set of regulations, under the new section 219 of the Federal Power Act, explaining in broad outline how it might approve generous financial incentives for new investments in transmission—incentives once dubbed as “candy.” As of mid-January, the new NOPR had spawned more industry comment than just about any other FERC proposal in recent memory.
Interchangeability issues threaten to delay vitally needed LNG projects.
Jake Dweck and David Wochner
Gas composition issues have become a significant hurdle for the industry. Resolving these challenges will not be easy, requiring all stakeholders to apply a thoughtful approach to understanding the issues.
A new wave of consolidation is coming. To succeed, a company must understand where its strengths are.
Peter Lorenz, Matt Pond, and Thomas Seitz
Companies that relied heavily on mergers and acquisitions generated more than half of the value in the power industry during the past 10 years. Furthermore, more than half that value was generated by a handful of companies. How did they do it?
The Energy Policy Act of 2005 makes human resource challenges even more significant.
Michael B. Brown
Hidden in the 1,700-plus pages of the Energy Policy Act of 2005 is a set of regulatory requirements that will redefine the technology, leadership, training, culture, compensation, job design, and organizational models currently employed in the industry.
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