The Securities and Exchange Commission's Division of Investment Management has proposed repeal of the Public Utility Holding Company Act of 1935 (PUHCA), with consumer safeguards preserved and transferred to the Federal Energy Regulatory Commission (FERC). Safeguards would include state access to holding company books and records, federal audit authority, and oversight of affiliate transactions.
Any executive who has gone through a merger, however well planned and executed, knows that it is a challenging process. Two essential ingredients are required before merger discussions can proceed from the initial "what if" stage to agreement on all critical and strategic issues. These ingredients must be developed by the chief executive officers through face-to-face meetings and a combination of intuitive response as well as specific examination of strategic issues.
(R-CA) in a letter attacking the Federal Energy Regulatory Commission's (FERC's) February 22 decision that the California Public Utility Commission's resource auction violated the Public Utility Regulatory Policies Act in failing to consider all sources in setting avoided costs. The letter opposes what it labels the FERC's attempt to overturn California's Biennial Resource Plan Update (BRPU).
While the intensity of management activity was very high throughout the merger planning process, it was generally well ordered, in large measure because our Corporate/ Utility Transition Team and 16 sub-teams formed an effective vehicle for managing the planning process.
The Transition Team was given less than one year from the July 27, 1994, merger announcement date to plan the implementation of the merger.
rolled-in pricing for new pipeline facilities where the benefits to the system are proportionate to the rate impact on existing customers (Docket No. PL94-4-000). In the past, the FERC made cost-recovery pricing decisions during the first rate case after the facilities were constructed. Now, the FERC will make its determination when the certificate is issued.
On a purely intellectual level, it is difficult to justify the Public Utility Holding Company Act of 1935 (PUHCA). Sixty years after passage, PUHCA has become an anachronism (em a fact well articulated in comments filed in response to the Concept Release on the modernization of the Act issued last November by the Securities and Exchange Commission (SEC).1 More recently, the SEC's Division of Investment Management actually recommended a conditional repeal (see sidebar).
On May 31, the Gas Industry Standards Board (GISB) circulated for industry review and comment proposed electronic standards for capacity release. The proposed standards are based on the work of the Federal Energy Regulatory Commission (FERC) electronic bulletin board (EBB) working group, and include those formally adopted by the FERC in Order 563. GISB added easy implementation methods and expanded the definitions of the information requirements. It also included enhancements that the FERC EBB working group plans to file for FERC review in the near future.
Ferd. C. Meyer
Senior V.P. & General Counsel
Central & South West Corp.
While I agree wholeheartedly with Mr. Hawes's conclusion that outright repeal of the 1935 Act (PUHCA) is needed, I disagree with his conclusion that the odds are currently against repeal.
The general enthusiasm for deregulation in Congress and the Administration (as noted by Mr. Hawes), and the compelling case for repeal, will, I believe, overcome arguments opposing repeal of a statute that is the embodiment of unnecessary and burdensome regulation.
Tennessee Valley Authority (TVA) chief operating officer
Joe Dickey is displeased with a General Accounting Office (GAO) report advocating a 10-percent rate hike for TVA. Dickey says that TVA has held rates steady for eight straight years and plans to hold them stable for at least another two. He notes that the report focuses on the past and suggests privatizing TVA as an option. Dickey adds that the GAO criticizes TVA cost,s but ignores that TVA has cut its workforce by half since 1988 and its costs by $800 million.
Last Spring I heard superintendent William "Billy" Ray tell how the folks down home at his Glasgow, KY, municipal utility took a flier on the information superhighway. They gambled and won by constructing a new utility-owned cable television system to offer competitive TV service to their municipal electric customers.
