Law & Lawyers

In Brief...

GAS COMPETITION PLAN. Colorado releases framework for rate and service unbundling for natural gas LDCs, which includes: treatment of stranded cost, utility affiliate participation in the competitive market and supplier obligations. Docket No. 97I-0336, Aug. 19, 1997 (Colo.P.U.C.).

Local Telco Rates. Idaho directs USWEST Communications Inc. to reduce annual revenues by $327,000 and approves proposal to compensate ratepayers $4.2 million for yellow pages revenues. It also sets the rate of return on equity at 11.2 percent.Case No. USW-S-96-5, Order No.

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People

THAINE J. MICHIE, general manager of the Platte River Power authority, was named president of the American Public Power Association. Michie has more than 30 years experience in the electric power industry; he has served on the APPA board since 1990.

Lanny P. Waguespack was chosen to head CMS Gas Transmission and Storage Co.'s new Denver office. He also was named director of business development in the western U.S. for the CMS Energy Corp. unit.

Executives at two subsidiaries of Aquarion Cos. were elected to leadership positions at industry associations. Leendert T.

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PUC Says Futures Trading Could Undermine PX

The California Public Utilities Commission, citing restrictions that force electric utilities to buy and sell power through the state's power exchange, has rejected a request by Pacific Gas and Electric Co., to use energy-related financial derivatives (em futures, swaps and options, etc. (em to manage risk associated with volatility in gas and electric commodity markets.

According to the commission, the proposal by PG&E for blanket authority to employ derivatives would violate several aspects of its electric restructuring policy.

Byline: 
Phillip S. Cross
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Joules

CON EDISON renamed two unregulated subsidiaries: ProMark Energy Inc. (now Con Edison Solutions Inc.) and Gramercy Development Inc. (now Con Edison Development Inc.). Con Edison Solutions will provide electricity, natural gas and oil to commercial and residential customers in the Northeast. Con Edison Development will invest in energy and nonenergy business in the U.S. and overseas.

AES Corp. has begun construction of an 830-megawatt, gas-fired combined-cycle power plant in San Nicolás, Argentina. Nichimen Corp.

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Utilities Must Educate, Again

Seeking to wrest control of public relations for electric competition from private "stakeholders," the California Public Utilities Commission has authorized the state's three largest investor-owned electric utilities (em Pacific Gas and Electric Co., San Diego Gas and Electric Co. and Southern California Edison Co. (em to spend $89.3 million for consumer education on electric restructuring, through mass media, mail, local outreach and a toll-free call center.

In a separate order, the PUC authorized PacifiCorp and Sierra Pacific Power Co.

Byline: 
Phillip S. Cross
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Renewable Subsidies in the Age of Deregulation

BY WHAT AUTHORITY CAN STATES FAVOR RENEWABLE

energy in a restructured electricity market?

Renewable resource funding marks a major point of contention in utility deregulation. Environmental groups fear that without some form of compulsion or subsidy, or both, renewable resources will not survive in an energy economy based on least direct consumer cost. However, utilities do not want to be saddled alone with the chore of carrying all renewables to market.

Byline: 
Steven Ferrey
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Green Power Marketing

UNDER RETAIL COMPETITION, AT LEAST SOME electricity customers will make purchase decisions out of concern for the environment. A variety of utility green pricing programs already target environmentally concerned consumers. Recent experience in Massachusetts and New Hampshire confirms that utilities and power marketers are gearing up for full-fledged green power marketing to differentiate their products in a competitive environment.

Byline: 
Steve Pickle, and Ryan Wiser
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Last Summer's "Pure" Capacity Prices

WHOLESALE POWER PRICES DURING THE SUMMER OF 1997 REACHED LEVELS MUCH higher than in 1996 - higher than the variable fuel costs of even the costliest units (see Figures 1 and 2). This situation has confounded many observers. Many thought, in spite of forecasts to the contrary, that markets would continue to exhibit excess capacity for years to come. They thought need for new capacity was distant and that hourly markets would not see premiums in excess of fuel costs for marginal units - the so-called "pure" capacity premium - for years to come.

The evidence is in.

Byline: 
Judah L. Rose
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Cutting Electricity Costs for Industrial Plants in a Real-Time World

AS U.S. ELECTRICITY MARKETS BECOME increasingly competitive, large industrial customers will discover many new choices. These choices include the opportunity to modify the amount and timing of electricity use in response to prices that vary from hour to hour. In addition, customers can sell certain electricity services, including operating reserves and load following, to the system operator. And industrial customers with cogeneration facilities can participate fully in bulk power markets, buying and selling energy and ancillary services in response to changes in spot prices.

Byline: 
Eric Hirst, and Brendan Kirby
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Gas Storage: What Moves the Market & What Doesn't

IS TEMPERATURE THE SINGLE MOST IMPORTANT FACTOR IN how gas storage is used? Or are other variables involved? Can we answer these questions - and verify the results?

Since FERC Order 636, natural gas storage has grown into a high-profile asset in the industry. As a result, the industry has responded by changing the way it uses this storage. The exact nature of this adjustment is not apparent at a glance; one must first analyze industry data.

Byline: 
John H. Herbert, James M. Thompson and Christopher Ellsworth
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