Fortnightly Magazine - July 15 1997

Maine, Montana Consumers to Get Choice

The governors of Maine and Montana (em two states with very different electricity markets (em have signed three bills into law to allow competition in the electric and natural gas industries in their respective jurisdictions.

Maine. Gov. Angus King signed an electric restructuring bill that mandates competition in the state starting March 1, 2000.

The Maine law, An Act to Restructure the State's Electric Industry, L.D. 1804, was signed on May 29. It allows for recovery of stranded costs as determined by the Maine Public Utilities Commission.

California Electric Restructuring Update

California regulators have issued a series of important rulings this spring as they continue to move forward with restructuring the state's electric utility industry.

On May 6, the California Public Utilities Commission accelerated the pace of its industry reform by ordering all electric utilities in the state to allow direct access to alternate electricity suppliers for all customers on Jan. 1, 1998.

Whither FERC?

With electric bills in Congress, and Moler bound for DOE, the Commission needs new vision.

Speaking in May at an informal press luncheon at the Washington International Energy Group in Washington, D.C., FERC Commissioner William L. Massey described the Federal Energy Regulatory Commission's role in an open-access electric industry as "nourishing" competition.

South Dakota Court Settles Boundary Dispute

South Dakota Supreme Court has ruled that state regulators erred in authorizing an electric utility to serve an established industrial customer of an electric cooperative.

The commission had found that the Northwestern Public Service Co. could replace Northern Electric Cooperative as the electric supplier for Hub City Inc. Hub had purchased an industrial property containing manufacturing facilities served by the utility and a plant addition served by the co-op.

Illinois Oks Three-Way Interstate Merger

The Illinois Commerce Commission has approved the three-way merger of WPL Holdings, IES Industries, and Interstate Power Co. to form Interstate Energy Corp.

The commission agreed that the public will benefit from the cost savings produced by the merger. The companies predict savings of about $750 million for the first 10 years after the merger. The Minnesota Public Utilities Commission granted merger approval on March 24. The Federal Energy Regulatory Commission concluded hearings in May and had yet to rule at press time.

Minnesota Approves "Interstate" Merger

The Minnesota Public Utilities Commission has approved the merger of Interstate Power Co., IES Industries Inc., and WPL Holdings Inc., joining Illinois, which has also signed off on the deal. (See, Headlines, this issue, p. 21.)

The commission estimated total merger-related savings of $592.1 million to $648.1 million over 10 years. Minnesota ratepayers could save nearly $15.5 million in electric costs and $6.4 million in gas over the same period.

N.Y. Proposes ESCO Rules, Tables Enron Plan

Finding it "too early" to consider proposals by Enron and Wheeled Electric Power to assign the state's electric utility customers to retail competitive energy service companies, the New York Public Service Commission nevertheless has mapped out a proposal to introduce competition in retail energy markets through a state-established retail provider of last resort.

The commission also would like to make information readily available to allow consumers to make informed choices. The proposed policy would permit adequate oversight of the market to ensure its fair operation (Opinion No.

QF Antitrust Complaint Dismissed

The U.S. Court of Appeals for the Third Circuit has ruled that federal antitrust laws provide no remedy for complaints by a qualifying cogeneration facility that an electric utility was impermissibly curtailing purchases under its power purchase contract with the QF.

It said that Pennsylvania's recently enacted electric restructuring law "comes too late" to make the QF's complaint a valid one.

Schuylkill Energy Resources Inc., owner and operator of an anthracite coal refuse-fired QF in Shenandoah, Pa., had filed an antitrust claim against Pennsylvania Power and Light Co.

Massachusetts Utilities File Electric Choice Plan

Eastern Edison Co. and Montaup Electric Co., both subsidiaries of Eastern Utilities Associates, have each filed an agreement with the Massachusetts Department of Public Utilities to introduce electric industry competition.

The target date for introduction of competition is Jan. 1, 1998, when Eastern Edison customers would experience a 10-percent rate cut or could choose an alternate electric supplier. Retail rates would be frozen until Dec. 31, 2000. But customers staying with the utility would be offered a price starting at 2.8 cents per kilowatt-hour.

Georgia Prepares for Retail Gas Competition

Under a new law deregulating the state's natural gas market, the Georgia Public Service Commission must enact regulations by Dec. 31, 1997, governing the certification of gas marketers and associated service quality standards and customer complaint procedures.