Fortnightly Magazine - October 2008

People

(Octover 2008) Xcel Energy named David Sparby president and CEO of Northern States Power Minnesota. Entergy Corp. appointed Terence Burke general counsel and chief legal officer for EquaGen, the joint venture operating company to be owned 50 percent by Entergy and 50 percent by Enexus Energy. Steven Agresta was named executive vice president, general counsel and chief legal officer for Enexus Energy. NorthWestern Energy appointed Robert C. Rowe as president and CEO. And others...

Letters to the Editor

(October 2008) The information in your Online ROE Database is very helpful and important for a state agency such as ours, which has very limited resources for the purchase of research information. May we have permission to cite and create exhibits from your online database of gas and electric authorized returns on equity and associated data?

Fixing Depreciation Accounting

Accumulated provisions for depreciation belong on the right side of the balance sheet.

The time has come to revisit where the accumulated provision for depreciation belongs. Utilities objected—some 50 years ago—when it was moved from the right side of the balance sheet to the left side, with good reason. Consistency, comparability, reliability and relevance all demand an end to this strange accounting practice.

The Carbon-Smart Grid

Network intelligence yields green returns.

A more sophisticated delivery network can yield “carbon value” via zero or low-emission generation, T&D efficiencies and innovative market strategies.

Transmission is Bubbling

A billion-dollar ‘gold rush’ could send grid rates through the roof.

Money may be difficult to come by for Wall Street financiers in these dark days, but apparently not for electric transmission construction—at least so far. A rash of recent orders from FERC shows that generous financial incentives remain available to companies seeking to expand the nation’s grid capacity.

The Path Forward

In the wake of the banking crisis, utilities lead the way to financial stability.

The back-to-basics trend positioned utilities and other energy companies to lead the way out of Wall Street’s mess. Despite a perfect storm of rising costs and a weakening economy, utilities and lawmakers might start a wave of investments in clean-energy assets and technology. But will Wall Street be ready to finance it?

I Want My In-Home Display

Consumers await a revolutionary interface.

Consumers await the revolutionary interface that will allow them to control their energy consumption. Besides maximizing efficiency in the home, these units will allow more

price and product competition. But disincentives to innovation are making for slow progress.

Creating the New Utility CEO

Increasing risks call for a new generation of leaders.

Can new nuclear power plants get approved? Will wind generators get production tax credits? Will West Coast companies be allowed to re-permit their hydro plants? Will cap-and-trade legislation endanger the coal industry? And who will pay for the transmission of renewable energy? These critical questions still remain unanswered, but utility companies must forge a business strategy through the murk.

Conquering Time

Understanding the value of pumped storage.

Pumped-storage technology allows utilities to defer the time value of energy, but project developers have struggled to make their economics work. Increased demand for ancillary services and standby capacity might make pumped storage more viable.

Smart-Grid Analytics

Intelligent networks support better decision making.

Sophocles once said, “Quick decisions are unsafe decisions.” Apparently Sophocles did not work in the utility industry. Utilities must make quick decisions every day to maintain a safe and reliable grid. As they have learned, the key to a quick and safe decision is making a well-informed decision. Yet utilities face challenges in providing enough information for their employees and automated systems to make these types of decisions.

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