(September 2010) Capital spending and commodity prices are driving changes in financial performance. The 2010 Fortnightly 40 report shows growing success for companies with substantial unregulated assets. As the industry resumes its Big Build, regulatory relationships will determine the long-term strength of utility shareholder returns.
Beyond-the-meter technologies challenge the utility monopoly.
Andre Begosso et al.
Smart metering and beyond-the-meter technologies are challenging the utility monopoly model. Now, regulated utilities must re-think their customer relationships as a revitalized retail sector provides growth opportunities.
Performance standards are a valid idea—if targets are achievable.
Hossein Haeri and Eli Morris
Performance standards are a valid and necessary idea to drive conservation, but only if targets are realistic and achievable. So far, success has been determined by program rationality. A uniform, market-based approach would give retailers flexibility to spur innovation.
New federal and state policy mandates are pulling state regulators in many directions. The patchwork of regulations has created a new level of complexity for utility investment decisions and political risk for utilities and state regulators alike.
(September 2010) During July ComEd brought $500 million worth of 10-year notes to market; Massey Energy acquired Marmet Dock from Kanawha River Terminals; Beacon Power raised $25 million in equity from Aspire Capital; other transactions involved Plains All-American Pipeline and Black Hills Corp.
When DTE Energy divested its transmission business back in 2003, the future of independent transmission companies (transcos) looked uncertain. A few transcos persevered, however, and this year for the first time the F40 survey includes one of them.
Fundamental issues set companies and regulators on a collision course.
Michael T. Burr, Editor-in-Chief
Industry leaders see a disaster coming, as the need for infrastructure investments collides with the economic interests of utility shareholders and customers. In a shaky economy and a politically charged campaign season, proposals for new capital expenditures are certain to cause trouble. Avoiding the train wreck will require real leadership in finding compromise solutions.
(September 2010) Duke names chief communications officer; PG&E appoints integrated DSM vice president; Entergy promotes four execs; Puget Sound Energy’s Kim Harris to replace Steve Reynolds; Richard Riazzi becomes CEO of Duquesne Light; Fred Butler joins Opower advisory board; Tom Kuhn to Control4; plus personnel changes at California ISO, AEP, Chesapeake Utilities, Southern Company, Exelon and others.
Transmission expansion is only part of the remedy for system constraints.
Building new transmission across the entire U.S. is an idea that continues to dominate discussions about the future of electric power. Many believe large amounts of power need to be moved across the country, or that transmission is needed to relieve congested areas, or to make sure enough renewable power is built. But transmission capacity is only part of the remedy to system constraints, and policy decisions and investment strategies must be based on sound evidence and economically rational planning.
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