Calendar of Events

Aug 04, 2014 to Aug 15, 2014 | Michigan State University, East Lansing, MI
Aug 11, 2014 to Aug 12, 2014 | New York, NY
Sep 08, 2014 to Sep 10, 2014 | Chicago, IL

Keywords

Public Utilities Reports

PUR Guide 2012 Fully Updated Version

Available NOW!
PUR Guide

This comprehensive self-study certification course is designed to teach the novice or pro everything they need to understand and succeed in every phase of the public utilities business.

Order Now

cash flow

Marketing & Competing

Corey Stone

Virtual DisCos? Utilities might be stepping out,

but outsourcers could be cutting in.Wholesale competition and the prospect of competitive retailing are leading many electric utilities to turn their distribution activities into discrete business units. But the emergence of the "DisCo" as a distinct entity may only mark the first step in a more radical disaggregation.

Why the distribution business may see radical change isn't immediately apparent.

Stranded Cost Recovery: All FERC'ed Up

Michael T. Maloney, Robert E. McCormick, and Chad A. McGowan

Stranded-

Cost

Recovery: All FERC'ed Up

By Michael T. Maloney, Robert E.

McCormick, and Chad A. McGowan

The "lost-revenues" approach in Order 888 ignores the fact that cash flow drives

asset valuation . . .

. . . the key to measuring uneconomic investment.

Financial News

Charles M. Studness

In the race toward competition, will outside investments break their poor track record?

The current rash of utility investments outside of the core franchise businesses appears to follow a pattern: a new spree of diversification every decade. Diversification was the rage in the early 1970s before the energy crisis, and revived during the mid-1980s when huge construction programs wound down. It has now reemerged as the threat of competition curtails traditional investment opportunities.

Competition, Confusion, and Chaos: The Metering Muddle

Alex Henney

With no system in place to collect data, retail choice brought gridlock to England and Wales in 1994.

Merger Mania Continues

Lori A. Burkhart

Ohio Edison Company and Centerior Energy Corp. announced an agreement September 17 on a tax-free, stock-for-stock merger to form a new holding company, FirstEnergy Corp., worth about $4.8 billion, based on stock prices that closed several days earlier.

The news came a month after two other merger deals were announced in mid-August: 1) Atlantic Energy, Inc. and Delmarva Power & Light Co. ($2.2 billion), and 2) Houston Industries Inc. and NorAm Energy Corp. ($3.8 billion). NorAm is the nation's third-largest U.S. natural gas utility.

Fitch Evaluates NY's Electric Future

Lori A. Burkhart

Citing the ongoing Competitive Opportunities Proceeding as well as recent public statements by New York Public Service Commission (PSC) chairman John O'Mara, Fitch Investors' Service predicts that New York will aggressively approach electric industry restructuring.

Fitch believes electric utility bondholders could be adversely affected by PSC policies that order less than full stranded-cost compensation, establish penalties to force disaggregation, or provide bailouts that transform weak companies into strong competitors.

What to do with All that Cash?

Charles M. Studness

What to Do With All that CASH?Seeing no need to build, utility managers are looking

to invest. Can they be trusted

with stockholder money?With little of the fanfare that surrounds the debate on utility competition, robust cash flows and declining capital outlays have created forces that will reshape the industry no matter how competitive restructuring unfolds. Cash generation already exceeds investment in core utility activities, and the differential will grow sharply over the next several years.

Unions and Deregulations: Some Lessons for Utilities

Ronald M. Johnson

Labor got on well with monopoly.

But now, if experience is any guide,

expect a stiff fight for benefits, jobs, and wages.

At this very moment, utility chief executive officers (CEOs) are planning for the future.

QF Fails to Raise Avoided Cost Rates

Phillip S. Cross

The West Virginia Public Service Commission (PSC) has ruled that it is preempted by federal law from modifying the avoided-cost rate in a purchased-power agreement implemented under the Public Utility Regulatory Policies Act of 1978 (PURPA).

The developers of a qualifying cogeneration facility (QF), Bituminous Power Partners, L.P., had asked the PSC to raise the contract rate for avoided energy in its purchased-power contract with Monongahela Power Co.

Phantom Taxes: The Big Paycheck

David M. Wise

The restructuring debate in the electric industry has focused on nuclear assets at risk for "stranding" under deregulation, while another issue has largely eluded public scrutiny: accumulated deferred federal income taxes (ADFITs). ADFITs represent money that utilities have received from ratepayers to cover federal tax expenses not yet actually recognized and paid.

Pages