[BETA] Fortnightly

POWER PLANT SALE. Central Maine Power Co. has agreed to

sell its hydroelectric, fossil and biomass power plants totaling 1,185-MW of generating capacity to FPL Group, the holding company of Florida Power and Light. The sale price of $846 million exceeds book value and could permit up to a 10-percent rate cut for customers by the end of the year.

OHIO/TEXAS DEAL. Ohio-based American Electric Power

Co. and Texas-based Central and South West Corp. on Dec.

Do mergers and "critical mass" really make a difference? The answer, it seems, is yes.

To become more competitive, U.S. electric utilities have embarked on a quest in recent years to improve operational efficiency and factor productivity. The question is: Are utilities making progress? And, which companies have gained a competitive edge? Which have not?

Industry analysts have long argued that given the structure of the markets they serve and their cost-based, rate-setting procedures, electric utilities tend toward monopolistic behavior.

A recent conversation:

"When was the demise of the regulatory bargain? What you say is true, but at some point you had to know the bargain was over."

(em A state utility commissioner

"Beats me, it doesn't seem to be over yet. The electric industry still has a duty to serve all customers, and it must charge below-market rate confiscatory for many of our services because of the regulatory bargain.

Nine Southwestern electric utilities are investigating the feasibility of establishing a regional independent system operator.

The Desert Southeastern Transmission and Reliability Operator (Desert STAR) would be the name of the new ISO. Initial members would include: Arizona Electric Power Co-op; Arizona Public Service Co., El Paso Electric Co., Nevada Power Co., Public Service Co. of New Mexico, Salt River Project, Texas-New Mexico Power Co., Tucson Electric Power Co., and the Western Area Power Administration's Desert Southwest Region.

Electric restructuring at the state and federal levels is moving forward fast (em too fast for some. Utilities, unions, consumers and even legislators are making their opposition known by filing lawsuits to block or slow down various restructuring initiatives, from New England to Dixie to the Desert Southwest.

Rolling Back Legislation

Pennsylvania and New Hampshire already have enacted legislation to guarantee customer choice in retail electric markets. Even so, some parties are asking for a rollback.

El Paso Energy Marketing hired Kathy Eisbrenner as senior v.p. Eisbrenner previously was with LG&E Natural Inc.

Cameron Raether, XENERGY senior consultant, was elected to the board of the Power Association of Northern California. Raether serves as chair on several boards and specializes in market evaluations for large electric and natural gas end users.

Robert G. Edwards was elected v.p. at Columbia Division of SCANA Energy Marketing Inc. Edwards joined SCANA in 1992 as a gas sales representative and has held various marketing positions.

Arizona Public Service Co. has filed a lawsuit in the Superior Court of Maricopa County to challenge rules adopted by the Arizona Corporation Commission in December 1996 to open the state's electric industry to competition over a four-year period starting in 1999.

John L. Carter was elected to Tucson Electric Power Co.'s board of directors. He replaces J. Burgess Winter, who resigned. Carter recently retired as executive v.p. and CFO of Burr-Brown Corp.

Madison Gas and Electric Co. promoted Terry A. Hanson to v.p. and treasurer. Hanson, who joined the company in 1981, had been treasurer.

Connecticut Natural Gas Corp. promoted two executives and hired a third.

The Arizona Corporation Commission has turned down a bid by Tucson Electric Power Co.

When the Salt River Project (SRP) held a series of focus groups in 1994, one participant said he related to our products and services, and felt he received good value for his monthly payments. Unfortunately, a few questions later, we discovered that he did not live in our service area, his bill was higher than he thought, and he wasn't particularly pleased after all.

We were more than a little taken aback.