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.
Fortnightly Magazine - April 15 1997
While authorizing Nashville Gas Co. to increase rates by $4.417 million, the Tennessee Regulatory Authority has modified its existing policy on the treatment of advertising expenses in gas rate cases.
The authority abandoned a past policy limiting advertising recovery to 0.5 percent of the company's gross revenues. It also ordered a 50-50 sharing between ratepayers and shareholders. It granted, however, the LDC's request for full recovery of both payroll and nonpayroll "sales promotion" costs, rejecting allegations the costs should be treated as advertising expenses.
Public Service Electric & Gas Co. has asked the New Jersey Board of Public Utilities to impose mandatory environmental disclosure requirements on all power providers who wish to compete in the state's market.
Specifically, the utility wants an environmental consumer protection standard requiring all sellers planning to compete in New Jersey periodically to disclose their system-wide emission rates or that of the source from which power is produced.
Everybody's got an opinion on electric competition, and they're dying to be asked.
Last year the Colorado Public Utilities Commission opened Docket No. 96Q-313E, In the Matter of the Inquiry Into Electric Utility Industry Restructuring. Then, after weighing several options, and rather than preempt the policy discussion, the PUC mailed a 26-page questionnaire to 360 people identified as "having an interest" in electric utility issues, including investor-owned electric utilities, rural electric cooperatives, municipal utilities and others.
What it learned could fill a book ....
A new report found advances in distributed electric generation, noting a pronounced shift since the early 1990s toward on-site generation, as electronic control systems now allow for remote dispatching, and combustion turbine engines are smaller, more powerful and offer increased energy efficiency.
North American Distributed Generation System Markets, produced by Frost & Sullivan, said that the Clean Air Act of 1972, and subsequent amendments made over the last 25 years, have influenced technologies.
The Palm Springs City Council has approved a contract with Portland General Corp., the parent company of Portland General Electric, which specifies the roles and responsibilities of both parties as the city establishes a new utility, "City of Palm Springs Energy Services."
Last December, Palm Springs had selected Portland General to become the city's new energy services partner to help it develop a municipal utility to compete in a deregulated marketplace.
Oglethorpe Power Corp. recently completed an extensive restructuring that transformed the generation and transmission power cooperative into three specialized companies better able to compete in a restructured electric market.
In addition, the company's board of directors has approved a deal that would allow Morgan Stanley Capital Group to supply Oglethorpe Power Co. one-half of its power needs for up to eight years. The deal has been presented to the 39 Electric Membership Corporations (EMCs) for final approval.
Do electric utilities understand how to earn profits for shareholders in a competitive market?
Here's one way to look at the problem. Gather a group of financial experts and ask this question: If a company's long-term bonds are rated AA, and yield 8 percent, what minimum return would you require from dividend yield and price appreciation to induce you to buy that company's stock?
The typical expert will say 12 percent, indicating a 4-percent premium (or spread) above AA bond yields.
New legislation would tackle the most difficult problem (em low load factors for small-volume customers.
We commend the Natural Gas Competition and Deregulation Act, SB 215, passed by the Georgia General Assembly in March. (Governor Zell Miller was expected to sign the bill in April.) The Georgia legislation envisions a new framework for regulating the retail gas market.
Loyalty may depend more on age group than anything else.
Utilities may want to start asking their customers some personal questions.
Such as: "How old are you?"
Why? Because customer behavior may have more to do with age and other demographics than anything. For instance, younger customers compose the highest-switching segment. However, older customers tend to have more loyalty. But so too, these loyal customers are the hardest to woo from another supplier.