Fortnightly Magazine - July 15 1998

Off Peak

AMERICAN SUPPORT FOR FEDERAL RESEARCH AND DEVELOPMENT funding for renewable energy and energy efficiency programs is increasing. Conversely, American support of nuclear power and fossil fuels is on the decline.

That's according to a recent survey, America Speaks Out on Energy: A Survey of Federal Energy Funding Priorities, conducted by the Sustainable Energy Coalition.

A thousand registered voters were asked about federal energy budget issues.

Will the Sun Set on PUCs?

WHEN 42 PUBLIC UTILITY COMMISSIONERS HUDDLED in private recently at the Brown Palace Hotel in Denver to discuss their roles come 2003, they came to a striking conclusion: Someday they might be out of business. Some said it would take five years, others said as long as 10.

"There was quite a bit of discussion and interest in commissions actually formulating what they call an 'exit plan,' by which they meant, in a kind of systematic way ... being prepared to wind back on their regulatory oversight," says Douglas N.

California's Electric Market: Are Customers Necessary?

A FREQUENTLY ASKED QUESTION UNDER CALIFORNIA's NEW electricity framework is, "Where have all the suppliers gone?" At a recent industry symposium, one large customer noted during negotiations with competitive energy suppliers that all five finalists had disappeared. The experience at my firm has been so draconian, but I have found that it is not unusual for half of the finalists to disappear in the bargaining. And when I say "disappear," I'm talking about something more extreme than simply reaching an irreconcilable difference.

FERC's Plan for Electric Competition

WHY IS ELECTRICITY COMPETITION NOT WORKING? The principal reason is the failure of Order 888 to accommodate the economic and technological constraints of wholesale power markets.

Soon after Congress passed the Energy Policy Act of 1992, to give authority to the Federal Energy Regulatory Commission to compel electric utilities under its jurisdiction to wheel power for others, the FERC correctly recognized that piecemeal wheeling orders wouldn't work well without a tariff. A tariff would make the service quickly available to the user without the need for time-consuming negotiation.

Frontlines

THE LAST FEW TIMES I'VE HIT THE ROAD FOR A INDUSTRY conference or speaking engagement, someone invariably has come up to tell me how my picture on this page seems to be getting younger. OK, I confess. Like many other columnists, I've probably carried on too long with the same old photo.

People

UTC, The Telecommunications Association, appointed William R. Moroney its executive director. He replaces Mike Meehan, UTC's executive director since 1988. Moroney previously served as president and CEO of the Multimedia Telecommunications Association.

LG&E Energy Corp. named Frederick James Newton III senior vice president of human resources and administration. Previously, Newton was senior vice president of human resources for Woolworth Corp.'s Champs Sports Division.

Commissioner Heather F. Hunt has resigned from the Maine Public Utilities Commission.

Mail

TEXAS CLARIFICATION. Thank you for the article, "From Statehouse to Your House: The Electric Competition Debate in Texas" (May 15, 1998 issue).

Please allow me to correct one point in that article, however. In discussing variations of distribution costs among utilities serving "deep East" Texas (a region of the state), the author believed me to be referring to Deep East Texas Electric Coop (a utility). Deep East Texas Electric Coop has one of the lowest distribution costs in the state; other neighboring coops in "deep East" Texas are somewhat higher.

Mail

PYRAMIDS FALL. While I enjoyed reading the "Pyramid Schemes" article in your May 1, 1998 issue, as the lead prosecutor in the Federal Trade Commission's action against FutureNet I feel a clarification is in order. While the FTC's complaint focused on FutureNet's Internet access program, certain concerns attach to any program which focuses on recruitment since one of the hallmarks of a pyramid is the lack of any relationship between the compensation paid to a distributor for recruiting and the sale of any product. (Webster v. Omnitrition International Inc., 79 F. 3d 776, 781 [9th Cir.

Benchmarks

BY 2010, SOME $21.8 BILLION WORTH OF EMISSION control technologies will have to be installed at steam-generating plants to reduce emissions of sulfur dioxide and nitrogen oxide.

Increased costs at these plants will boost power prices. These higher costs and higher revenues will increase profits of the five least competitive companies will lose $1 billion.

Power companies must increasingly incorporate environmental factors into strategic planning.

News Digest

Power Pools & Reliability

SUMMER IN WISCONSIN. Responding to concerns about the electric shortages of the summer of 1997 and fears that they could happen again, Wisconsin PSC Commissioner Joseph P. Mettner has indicated that the state's energy supply outlook for the summer of 1998 appears much better in eastern Wisconsin than it did one year ago.

Mettner noted that Wisconsin's electric supply system is operating with expected reserve margins of 19.2 percent. But he cautioned that electric power flows do not respect borders.

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