Perspective

Hard-and-fast ring-fencing rules are not the best way to maintain order in the partially deregulated utility sector.

In 1992, my colleagues on the Michigan Public Service Commission (MPSC) and I initiated the first retail wheeling case in the country. Retail wheeling was the old name for competition, back when everyone thought that moving electrons from one place to another was a relatively simple task, one that could not in any way harbor underlying sinister acts or motives.

Business & Money

Credit-rating linkage harms certain power companies. Ring-fencing is the best answer for regulators.

In recent years, a persistent battle has developed between state public utility commissions (PUCs) and holding companies over the negative financial and operational impacts on regulated utilities of failed diversification investments. Ratepayers expect to compensate companies for the costs of providing utility service-not those costs associated with the unregulated activities of affiliated companies.

People

New Opportunities:

The Federal Energy Regulatory Commission appointed Joseph H. McClelland director of its Division of Reliability in the Office of Markets, Tariffs, and Rates. McClelland is general manager of the Custer Public Power District in Nebraska.

Colorado Gov. Bill Owens appointed Carl Miller, a state representative, to the Colorado Public Utilities Commission (PUC). The reports that Miller cannot seek re-election because of term limits.

Judy Pensabene has joined the Republican staff of the Senate Energy and Natural Resources Committee as deputy chief counsel. She is returning to the committee, where she worked from 1990 to 1995, after serving as vice president of federal affairs at Constellation Energy Group.

Entergy announced that Peter P. Schneider has been hired as vice president of Nuclear Human Resources, a new position within the company. Schneider's prior experience includes stints at Human Resources Strategies and Solutions, Inc., Exelon, and PECO Energy.

New technologies cloud the future for the traditional electric utility, but offer hope to the gas industry in boosting residential demand.

Investors apparently were paying attention in January when a Web-based analyst predicted Plug Power's stocks could gain 10,000 percent or more by 2010. Before month's end, the fuel cell manufacturer, which doesn't expect to turn a profit before 2004, saw a ninefold increase from the $16 closing day share price at its October initial public offering. That month Avista Corp.

Do state regulators stand to learn more from their electric choice information programs than the customers they aim to reach?

What does it cost to educate an energy consumer about electric choice? Between $1.60 and $2.26, to judge by the public education campaigns in California, Pennsylvania and New Jersey.

In the first year of their information programs, these states spent a combined $103 million, funded through consumer rates. Though an impressive total budget for three public initiatives, that amount pales in comparison to the ad dollars spent by General Motors.

News Digest was compiled by Carl J. Levesque, editorial assistant, Lori A. Burkhart, contributing legal editor, and Bruce W. Radford, editor. For continual news updates, see www.pur.com.Nuclear Power

Transmission & ISOs

Transco Independence. Granting Entergy's request for a declaratory order, the Federal Energy Regulatory Commission ruled in a case of first impression that a stand-alone transmission company ("transco") would meet the test in Order 888 for independent system operators despite passive ownership by a power producer or other market participant.