Fortnightly Magazine - September 1 1996

N.M. Rejects Tariffs for LDC Nonutility Services

The New Mexico Public Utility Commission (PUC) has rejected a request by PNM Gas Services, a division of Public Service Co. of New Mexico and a natural gas local distribution company (LDC), to implement two new experimental "optional utility services": 1) a Food Service Maintenance Program (maintenance and repair on commercial equipment), and 2) an Energyguard Bill Payment Protection Plan (insurance).


Lisa S. Beal was hired by the Interstate Natural Gas Association of America as environmental affairs director. She comes from the Hazardous Waste Management Association, where she was transportation/safety manager.

Commissioner Stan Wise was elected second v.p. of the Southeastern Association of Regulatory Utility Commissioners. Wise is vice chair of the Georgia Public Service Commission.

The City of Anaheim Public Utilities hired Dale Tarkington away from Arizona Public Service Co.

Michigan Reaffirms NYMEX Gas-pricing Mechanism

The Michigan Public Service Commission (PSC) has upheld a previous ruling finding it prudent for Michigan Consolidated Gas Co. to lock in a reasonable cost of gas through a series of gas-supply contract elections of alternative prices tied to the NYMEX (New York Mercantile Exchange) gas futures market. The PSC commented on its earlier ruling, however, to clarify that its remarks on the relatively small effect of the pricing decisions on the overall cost of gas for the local distribution company (slightly more than 1 percent) did not constitute a new policy.

Rate Plan Emphasizes Incentives, Low-income Assistance

While approving a proposal by Marbel Energy Corp., owner of an independent gas and oil production business, to acquire Northeast Ohio Natural Gas Corp., a natural gas local distribution company (LDC), and Ohio Intrastate Gas transmission Co., an intrastate gas pipeline, the Ohio Public Utilities Commission (PUC) has directed both the LDC and the pipeline to offer nondiscriminatory open access to all of their service offerings. The PUC explained that the open-access condition would further competition in the state's natural gas industry.


Cleveland Electric Illuminating Co. (CEI) customers will soon be able to earn "frequent flyer" points for using electricity or replacing gas appliances with electric ones. Under the program, planned for Spring 1997, customers receive one point for every kilowatt-hour they use each month. Points can be redeemed for electric appliances, such as night lights, air purifiers, and electric grills.

Ratepayers to Bear Above-Market QF Rates

The New Jersey Board of Public Utilities (BPU) has rejected a proposal to disallow from rates "potentially stranded costs" incurred by Atlantic City Electric Co., an electric utility, under several "above-market" purchased power contracts executed with qualifying cogeneration facilities (QFs) in the late 1980s.

West Virginia Revamps Gas Rules

The West Virginia Public Service Commission (PSC) has approved a series of changes to its rules and regulations for gas utilities and gas pipeline safety. The changes include a new rule on customer deposits that calls for annual adjustment of the interest rate utilities pay on such deposits. The PSC explained that the change is designed to make the rate more market sensitive by tying it to U.S. Treasury Bill rates for the last quarter of the preceding year.

States Examine LDC Metering Rules

Utilities in two states have taken steps to exert tighter control over meter-reading services.

The Michigan

Public Service Commission (PSC) has authorized Consumers Power Co., a local distribution company (LDC), to revise its operating rules governing centrally metered service installations.

Off Peak

Capacity and energy go together like corned beef and cabbage (em

even a two-handed economist can see that.The June 11 Power Broker decision from the D.C. Circuit, involving Florida Power and Light Co. (FP&L) and certain wholesale customers (see sidebar), reminds one that a dish of corned beef and cabbage tastes better when you don't leave out the cabbage.

On the surface, the case indicts the idea of average-cost pricing: "All hands recognize that the

problem originates in the use of average costs . . .