Indiana Stranded Costs "Minor"

Fortnightly Magazine - September 15 1996
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The Indiana Utility Regulatory Commission (URC) has given the Indiana legislature a brief summary report in advance of its final energy report on competition. A new law mandates an annual URC report that analyzes the effects of competition or changes in the energy utility industry on service, and on the pricing of all energy utility services under URC jurisdiction.

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The summary report finds that the "agreeable objectives of Orders 888 and 889 can be accomplished without the degree of federal intrusion that is contemplated by those rules." Interestingly, the URC notes that Indiana utilities exhibit "relatively little" stranded-cost concern. Apparently, Northern Indiana Public Service Co. finds its stranded-cost exposure minor. Indianapolis Power & Light takes the position that all utility recovery should be denied because it will delay competition. The report finds most U.S. stranded costs concentrated in the Northeast and California.

On the gas side, the URC concludes that industrial customers received the majority of benefits, residential customers the least (em in some cases, their prices increased.

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