Last year was pivotal for nuclear power. On May 13, 1994, the board of directors of the Washington Public Power Supply System (WPPSS) voted 9-4 to terminate reactors WNP-1 and WNP-3, triggering a dismantling of the two mothballed reactors, both about 70 percent complete. For ratepayers in the Pacific Northwest, the decision offered no relief from bills for construction of the two plants (em recently estimated at about $350 million per year for the next 24 years1. In many ways, WPPSS and its troubled history is a microcosm of the U.S.
Close Close Percent 52-Wk 52-Wk Div Div Book P/E Last
Company Region 03/31/95 06/30/95 Change High Low Rate Yield Value Ratio 12 Mos.Electric Utilities
AEP Company Inc. Midwest 31.75 35.13 10.63 35.75 29.00 2.40 6.83 22.68 13 2.68
Unicom Corp. Midwest 23.75 26.63 12.11 27.75 20.63 1.60 6.01 24.39 14 1.90
Union Electric Co.
With this issue I've finished up my first 12 months as full-time editor of PUBLIC UTILITIES FORTNIGHTLY. During that time, I've tried to adhere to few simple rules. If I'm lucky, I'm batting four out of five:
s Trust ideas, not facts
s Welcome different views
s Don't shy from difficult subjects
s Make it easy to read
s Take a day off now and then.
Someone once said that an editor's job is twofold: "Simplify and exaggerate." That advice may sound peculiar, but one could do worse.
In an important case involving electric retail competition, the New Hampshire Public Utilities Commission (PUC) has made a series of legal rulings favoring a proposal by Freedom Electric Power Co. to purchase and resell power to end users currently served by Public Service Co. of New Hampshire (PSNH). The PUC ruled that franchises granted to electric utilities in the state are not exclusive and that the proposed activities would make the energy company a public utility if approved and implemented.
Robert S. Silberman has joined California Energy Co. Inc., the largest independent geothermal power producer in the world, as senior v.p. of project development and implementation.NUI Corp. has appointed James R. Van Horn general counsel and corporate secretary. Van Horn was previously senior v.p., general counsel, and secretary at Citizens First Bancorp. Inc.
The interim board of directors of WorldTel has elected Sam Pitroda chairman.
The Maine Public Utilities Commission (PUC) has approved a regulatory reform plan for New England Telephone and Telegraph Co., a telephone local exchange carrier (LEC). The plan includes a price cap program for "core" services (em that is, nondiscretionary services such as basic exchange and toll services. The price-cap structure and pricing rules will not apply to the LEC's noncore services.
is Never Lost
In spite of ample arithmetical examples, the basic point made by Lawrence Kolbe and William Tye in "The Cost of Capital Does Not Compensate for Stranded-Cost Risk" (May 15, 1995) is simply wrong. The authors claim that "even if the cost of capital [reflects] full knowledge of the risk of stranded costs," it will not compensate for that risk.
The Virginia Corporation Commission has rejected claims that it has no jurisdiction over disputes involving attempts to municipalize electric service. The case involves a dispute between Virginia Electric and Power Co. and the City of Falls Church, VA.
Central and South West Corp. notified bankrupt El Paso Electric Co. (EPE) on June 9 that it has terminated the companies' proposed merger. CSW had informed EPE on May 23 that it had breached the merger agreement by participating in discussions about and spending large sums on a possible stand-alone reorganization plan.
The CSW board of directors rejected EPE's request to extend the merger agreement for six months until December 8.
