Fortnightly Magazine - February 15 1999

Retail Wizardry: How To Make Money in Today's Power Market

A hedging strategy to protect gross margins in a fixed-price mass market.

The retail electricity markets in the United States are set to bloom. Retail power marketers presently must navigate various hurdles, raised by incumbent utilities, before they are able to establish a foothold. Some states, however, including Pennsylvania and Massachusetts, have established a fixed schedule for the recovery of stranded costs, resulting in profit opportunities for new entrants.

Byline: 
Michael C. Hsu, and Nguyen T. Quan
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The Fortnightly 100 Revisited: Do Utility Stock Prices Reflect Operational Efficiency?

The numbers say "yes," adding weight to last year's benchmarking survey.

Does productive efficiency help determine an electric utility's prospects in regulated or competitive markets? Is productive efficiency a better marker of real-world success than simple financial attributes, such as cash flow, dividend ratio or operating income?

In unregulated markets, higher productivity translates directly into relative declines in costs and prices, and by extension, greater ability to compete and prosper.

Byline: 

Hossein Haeri, Matei Perussi, and M. Sami Khawaja

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