[BETA] Fortnightly

It was after seven o'clock in the evening (em nearly 12 hours since the DOE-NARUC Second National Electricity Forum had gotten underway up in Providence, RI (em when it all finally hit home. This time the regulators were serious. People were paying attention.

The structure of the utility and telecommunications industries has changed significantly since I began my role as a regulator 15 years ago. Technological developments and a competitive environment, as opposed to regulation, have provided the major catalyst for change. As a result, utility companies, which have historically enjoyed the favor of Wall Street investors, will soon face unprecedented revenue growth problems.

Emissions Trading:

NARUC Goes on Record

In a recent article, "Why Taxes Do Distort Emissions Trading" (Feb.15, 1995), Stanley I. Garnett II, chief financial officer of Allegheny Power System, Inc. discusses a legislative proposal currently promoted by his firm and the Chicago Board of Trade (CBOT). This proposal seeks to amend current Internal Revenue Service policy on federal tax treatment of the proceeds of emission allowance sales.

At the National Association of Regulatory Utility Commissioners (NARUC) winter committee meetings in Washington, DC, the executive committee passed a resolution that Congress should not hold hearings on reforms to the Public Utility Holding Company Act (PUHCA) until the Securities and Exchange Commission has completed its investigation on the implications of repeal or substantial modification.

The Southern Company named A.W. (Bill) Dahlberg chairman and CEO in addition to his current duties as president. He succeeds Edward L. Addison, 65, who is retiring after 12 years as CEO and more than 40 years with the company. Dahlberg, 54, served as president since January 1, 1994. He began his career with The Southern Company at age 19 when he joined Georgia Power, a subsidiary, as a meter installer.

Ralph Johnson was named v.p., power resources, for the Texas-New Mexico Power Co.

How risky are utility investments today? Regulators have always faced this question when setting the return component of rates under traditional rate base/rate of return regulation. With major industry restructuring looming, risk issues have become proportionately more important and complex. California regulators, for example, have increased the return for the state's electric utilities to account for investor worries over the pace of restructuring in the "Blue Book" proceeding.

For the last eight years of my 27-year career in the military, I was responsible for merging the Air Force's computer business with its communications business. This undertaking was similar in at least one significant way to current efforts to expand the role of computers in the regulated utility environment (em education is paramount.

Utilities typically employ computer technology either by creating internal information management divisions/subsidiaries or by outsourcing the work to a company that specializes in computer information technology.

You can look at the title in two ways: (a) "The sky is falling," or (b) "There's nothing new under the sun." But both views are wrong. Let me explain.

No one doubts that state public utility commissions (PUCs) must change. But we need not throw up our hands in despair or smile and pretend we've seen it all before. Yes, PUCs have seen major changes before. The 1930s expanded PUC authority from an advisory, sunshine role to serious oversight.

Over 300 bills were introduced in the first week of the new Congress that convened in January, among them a bill by Sen. J. Bennett Johnston (D-LA) aimed at correcting the government's seriously flawed nuclear waste storage program. Johnston heralded S.

Paul J. Evanson was named president of Florida Power & Light Co. to succeed Stephen E. Frank, who resigned in January. Frank led the company through a tough restructuring process. Evanson, 53, previously was v.p., finance, and CFO for both Florida Power & Light and FPL Group Inc. Evanson will be succeeded by Michael W.