DC

The Gas Executives Forum: Gas Pains

Commodity price upheavals are energizing gas utilities to evolve their business models.

Top officials at several U.S. retail gas companies reveal how they are rethinking their business models and developing new approaches to serve customers in the face of supply concerns and price volatilities.

Barriers to Transmission Superhighways

History teaches us that the most successful American businesses emerge from the crucible of competition.

Important challenges still confront the development of a coherent strategy to create an efficient modern transmission system. Assuming FERC and Congress are earnest about creating a 21st century grid, new ideas, projects, and technologies need to emerge.

East Vs. West: Growing the Grid

The models and motives behind tomorrow’s transmission expansion.

Major transmission projects based on two distinct models are showing signs of life. What can these projects teach us about future transmission investment?

Wall Street's Egalitarian View

Investors are making little distinction between regulated or unregulated business strategies. One banker suggests it will be difficult to stand out.

It seems history does repeat itself all too often. In the late1990s, a common complaint by utility CEOs was that utility price-to-earnings (P/E) multiples did not take into account whether a com- pany was a pure-play regulated utility, a diversified utility with a merchant subsidiary, or something else. Many say investors at the time just didn’t understand the different business models that were emerging after electric restructuring.

Special Section On Metering: Thinking Smart

Legislation and technology developments give a jump-start to smart metering

What a difference a year makes. In 2004, automated metering infrastructure (AMI) was in something of a slump, but the Energy Policy Act of 2005, an uptick in natural disasters, and encouraging results from pilot projects have strengthened the business case for investing in AMI.

What a difference a year makes.

In 2004, the automated metering industry was in something of a slump. After the 2003 Northeast blackout, and facing rising gas prices and diminished investor confidence during a time of war, many utilities put automated meter reading (AMR) on the back burner.

A Candy-Coated Grid

Incentives for transmission investment could boost postage-stamp pricing over license-plate rates.

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.

Long-Term Transmission Rights: A High-Stakes Debate

The absence of long-term transmission rights could exclude potential competition—and cause higher electricity costs.

Power-industry restructuring redistributed financial uncertainties that discourage generation investment and ultimately raise the price of electricity to consumers.

LNG's Final Hurdle

Interchangeability issues threaten to delay vitally needed LNG projects.

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.

People

(March 2006) FirstEnergy Corp. named Bennett L. Gaines vice president and CIO. PPL Corp. named Matt Simmons vice president and controller. NorthWestern Corp., d/b/a NorthWestern Energy, named D. Louis Peoples to its board of directors. The Nuclear Regulatory Commission’s Advisory Committee on Reactor Safeguards re-elected Dr. Graham B. Wallis as chairman, Dr. William J. Shack as vice-chairman, and John D. Sieber as member-at-large. And others...

Natural-Gas Procurement: A Hard Look at Incentive Mechanisms

Better designs are needed to realize the goal of lower-cost gas.

A gas procurement incentive mechanism that provides strong incentives for a broad range of procurement-related costs and revenues, using a benchmark that is both exogenous and adaptive to external circumstances, can benefit consumers.