Central and South West Corp.'s subsidiary, Central Power and Light Co. (CPL), has proposed that all ERCOT nonnuclear utilities (em including IPPs, co-ops, and municipals (em become part of a competitive wholesale bulk power pool run by an independent system operator (ISO).
Transmission and distribution companies would continue to own and operate power lines, purchase all nonnuclear generation from the pool, and assume responsibility for actual delivery.
The Oklahoma Municipal Power Authority (OMPA) and the Public Utilities Board (PUB) of the City of Brownsville, TX, have announced their intent to form a municipal power pool spanning four states. OMPA is a full and partial requirements wholesale supplier to 35 municipal electric systems in Oklahoma. PUB owns coal- and gas-fired generation plants. The two entities offer a combined supply resource of about 800 megawatts, but rely on the transmission system of Central and South West (CSW).
Paper trading is here, introducing an element of speculation in wholesale electric markets.The electric power industry joined the commodity markets on March 29, 1996, when power futures began to trade on the New York Mercantile Exchange (NYMEX). This first tentative step in the commoditization of electricity promises the emergence of a paper market for power, which, as in the case of other commodities, will likely prove substantially broader and more complex than electricity's physical market.
Carter T. Funk was promoted to v.p.-business and operations services at Consolidated Natural Gas Co. He moves up from v.p.-asset acquisition and resource development at CNG Energy Services.
Marian M. Davenport was promoted to v.p., general counsel, and secretary for Destec Energy, Inc. She replaces Stephen R. Wright, who retired.
Central and South West Corp. has elected Jim Ellis, chairman and CEO of SEEBOARD plc, to its board of directors.
Cutting employees
may be less than healthy, unless you're ready to replace them with technology.
As competition intensifies, increasing numbers of executives are realizing that customer service may have a more important role now than just placating regulators. After all, the broad spectrum of customer service is the principal way (em other than rates (em to differentiate a utility product and the utility itself.
In a recent article ("The Efficient Utility: Labor, Capital, and Profit," Sept. 1, 1995), Taylor and Thompson attempt to measure the
economic efficiencies of 19 investor-owned utilities.
The authors use a method of efficiency measurement proposed by M.J. Farrell in a pioneering paper published nearly 40 years ago.
Low Loads, Short Ride
Kevin O'Donnell's article "Aggregating Municipal Loads: The Future is Today" (Oct. 1, 1995) argues that residential and small commercial low-load-factor customers will do well in a competitive environment. Yes, I agree that the future for these customers is definitely today. Low-load customers will do much better in the short run. As long as excess capacity exists, sellers will price at little more than short-run marginal cost. Once excess capacity dries up, however, fixed costs will have to be paid.
Otter Tail Power Co. (OTP) president John MacFarlane is pursuing the utility's plan to manage the assets of a portion of the Western Area Power Administration (WAPA) for a five-year period, to smooth the way toward privatization of the nation's power marketing agencies (PMAs).
MacFarlane has written for support to the senators who represent OTP's utility's three-state service area: Byron Dorgan (D-ND), Kent Conrad (D-ND), Tom Daschle (D-SD), Larry Pressler (R-SD), Rod Grams (R-MN), and Paul Wellstone (D-MN).
Southwestern Public Service Co. (SPS) and Public Service Co. of Colorado (PSCC) have entered into a definitive merger agreement to form a public utility holding company that will cover one of the largest geographic areas in the nation. Size apart, the merger is unique in that SPS operates as part of ERCOT, and the two utilities are not interconnected. A new transmission line will be built to connect the two companies.
The new holding company will have combined annual revenues of $3 billion, and assets of $6 billion.
A couple weeks ago, on a beautiful Sunday morning, I picked up my briefcase and wandered down to the Potomac river shoreline to catch up on my summer reading list. There, on the Virginia side, gazing across the river at the Lincoln Memorial, Washington Monument, and Capitol dome, I gathered strength to tackle a foot-high mound of paper.