Marketers and Brokers
Erroll B.
Law & Lawyers
Gas-Fired Generation
Stephen P. ReynoldsPresident & CEO
Pacific Gas Transmission Co.
Two or three years ago, gas-fired generation was hailed as a cure-all for everything that ailed the natural gas industry.
The Monolith is Cracking: Electric Restructuring and its Implications for Gas
The profound changes now occurring in the electric industry will most directly affect those who are engaged in the enterprises of generation, transmission, and distribution of power. But challenges and opportunities confront gas companies as well. Certainly, the electric industry will continue to influence markets for gas: both in bulk fuel supply and in retail energy.
FERC Asked to Reconsider Avoided-cost Order
Metropolitan Edison Co. (ME) and Pennsylvania Electric Co. (PE), subsidiaries of General Public Utilities Corp. (GPU), have asked the Federal Energy Regulatory Commission (FERC) for rehearing on parts of its July 6 order, which the two companies had challenged under the Public Utility Regulatory Policies Act in Pennsylvania (Docket No. EL95-41-000).
Specifically, the utilities had challenged the Pennsylvania Public Utility Commission's (PUC's) method of using a coal plant proxy to calculate a default level of avoided costs.
Cajun Conflict Continues
Cajun Electric Cooperative has lost its request with the Fifth Circuit Court of Appeals for an emergency stay of the appointment of a trustee in bankruptcy. Cajun had claimed a conflict of interest because the proposed trustee, Ralph Maybe, belongs to the Salt Lake City law office of LeBoeuf, Lamb, Greene & McRae, which worked for Entergy and Gulf States Utilities Co. (GSU) on matters concerning the River Bend nuclear plant. Entergy and GSU have been involved in a $2-billion lawsuit with Cajun over the plant since 1989.
U.S.
Electric Industry Restructuring: The States Forge Ahead
About 30 states have begun (em
either through the legislature, the utility commission, informal working groups, or some combination of these (em to consider issues such as retail wheeling, unbundled utility structures, and alternative rate regulation.1 California's "Blue Book" hearings have drawn the most attention, but significant efforts are also underway elsewhere. Although each state is approaching the issue in its own way, successful industry restructuring will ultimately require coordination across state lines.
Ontario Faults Gas DSM Plan
While setting rates for Union Gas Ltd., a natural gas local distribution company (LDC), the Ontario Energy Board found the LDC's demand-side management (DSM) plan deficient and ordered shareholders to bear the cost of any required remedies. The Board found, however, that denying the DSM budget would make it harder for the LDC to accomplish energy conservation and environmental objectives and, would run contrary to the public interest.
Potomac Electric: Win Some, Lose Some
The District of Columbia Public Service Commission (PSC)
has allowed Potomac Electric Power Co. rate recovery of costs associated with the development of electric vehicles for fleet use under alternate-fuel vehicle requirements imposed under the Energy Policy Act of 1992. The PSC rejected a request by the Greater Washington Petroleum Committee, an oil industry trade group, to deny funding because electric vehicle technology had not evolved to a point that promotes consumer acceptance of a competitively priced vehicle.
Ill. Approves Telecom Cost-of-Service Rules
The Illinois Commerce Commission approved new rules for cost-causation principles used by telecommunications carriers in setting rates for competitive and noncompetitive services. The new rules rely on long-run service
incremental-cost studies to measure the cost of providing individual services and to check for subsidies between service groups. Carriers will also be required to use an aggregate revenue approach to test pricing for competitive and noncompetitive services. Re Implementation of Section 13-507 of the Public Utilities Act, No. 92-0211, July 19, 1995 (Ill.C.C.).
Fla. Updates Water ROEs
In a preliminary ruling, the Florida Public Service Commission (PSC) has proposed several changes to its rules for setting a generic rate of return on common equity (ROE) for water utilities. The proposed leverage formula produces a suggested ROE range of 10.18 to 11.88 percent, based on an equity ratio of 40 percent. The change represents an increase of 55 basis points over the midpoint indicated by the existing formula. According to the PSC, the update incorporates changes in underlying market conditions, including bond yields and required rates of return.