Some see utilities fixing prices under competition. Really? I'm shocked.
Did you hear the one about the 10,000 percent rate increase? Ask FERC chairman James Hoecker or his colleague, Curt Hébert. They'd be happy to tell you. They don't even need their own joke writers. This story, you see, is absolutely true.
It seems that Virginia Electric & Power Co. wanted to squeeze just a little more profit from its Kerr-Henderson transmission line.
Albert V. Ruggiero was elected vice president for South Jersey Industries Inc. Ruggiero also serves as senior vice president, corporate development for SJI's principal subsidiary, South Jersey Gas Co.
The Bonneville Power Administration announced four new senior vice president positions. Harvey Spigal will return to general counsel after heading BPA's transmission functions for the past two years. BPA's corporate group will be headed by Steve Wright. Paul Norman was named permanent head of the power business line. Mark Maher will head the transmission business line on an acting basis.
State PUCs
Distributed Generation. California opened a rulemaking proceeding to consider regulatory reforms in electricity distribution service, with a possible focus on distributed generation. The commission emphasized that its intent was not to define new policies, but to gather information. Comments are due March 17, and the commission intends to consider a proposal from the assigned commissioner this summer. Rulemaking 98-12-015, Dec. 17, 1998 (Calif. P.U.C.).
Gas Transportation Rates.
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.
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.
Sales prices for power generation assets in the United States during the past two years have climbed to unprecedented levels. This trend should continue. More than 20,000 megawatts of generation assets have been sold, with another 20,000 MW announced. During the next five years, it is expected that 70,000 to 140,000 MW will change hands. We have seen only the beginning of a massive redistribution of generation assets - from regulated utilities to unregulated marketers and plant operators.
In fact, the prices we've seen for generation assets may turn out to be bargains.
Micro maverick Bill Althouse sees a grand conspiracy to blot out customer-owned generation.
Distributed generation is out of the box. It's time for regulators to wake up. The paradigm has already shifted."
That's Bill Althouse talking, president of Althouse Inc. of Albuquerque, N.M., a seat-of-the pants business (he says he's near bankruptcy) that helps homeowners and businesses install on-site generation. I met him via email as I researched why, on Jan.
The Natural Gas Supply Association promoted John H. Sharp and Philip M. Budzik. Sharp, the association's chief lobbyist and counsel since 1988, became vice president, federal and state government affairs, and counsel. Budzik, previously director of research and analysis, was named vice president, federal regulatory affairs and technical analysis.
Bob Wentland joined Coherence Technology Company Inc. as research geophysicist. Wentland also is the manager of product development for CoherentVision(. Wentland's career includes 16 years with Shell Oil Co.
The future contract for July delivery at cinergy remains at levels reminiscent of last year's prices. At one point the contract reached $170 per megawatt-hour, matching last year's actual average price during June and July. High forward contract prices such as this show that market traders believe that spot prices for electricity will again be sent to four-digit levels.
Three primary factors led to last year's price spikes. First, nearly 23 percent of the capacity in the Midwest was unavailable during June.
Studies and Reports
Natural Gas Retail Choice. Utility affiliates hold large market shares in natural gas customer choice programs, raising questions about the extent of true competition, according to a study released on Dec. 15 by the U.S. General Accounting Office. Participation varies by region, however, according to the report, "Energy Deregulation - Status of Natural Gas Customer Choice Programs."
In Pennsylvania, for example, three out of four programs showed very high shares for utility affiliates. The Equitable Gas Co.