American Public Power Association

This New Congress Means Business

After 40 years of wandering in the wilderness as a minority party, House Republicans are ready to slash and burn what they see as a bloated federal bureaucracy. The next two years will demonstrate just how powerful the legislative branch can be when both House and Senate are controlled by a strong-willed party on a mission. Electric industry officials seem optimistic, but cautious, about this Republican revolution.

Financial News

On December 12, 1994, Craven Crowell, chairman of the board of the Tennessee Valley Authority (TVA), issued two well-publicized announcements. First, TVA would not finish three of the nuclear units it has had under construction since the 1970s, unless it could find partners willing to share their construction costs (a prospect he subsequently characterized as "very slim,").1 Second, TVA planned to set an internal cap on its total debt at a level $2 to $3 billion below the $30-billion limit imposed by the Congress.

People

Larry Hobart, executive director of the American Public Power Association, plans to retire on July 1, ending a 35-year career with public power. Hobart became executive director in 1986, and previously served in several management positions. Hobart also serves as v.p. and board member of the Consumer Federation of America.

Pacific Enterprises, parent of Southern California Gas Co., has restructured the company, to include a new Office of the Chairman. The new office will be headed jointly by Willis B.

People

Paul J. Evanson was named president of Florida Power & Light Co. to succeed Stephen E. Frank, who resigned in January. Frank led the company through a tough restructuring process. Evanson, 53, previously was v.p., finance, and CFO for both Florida Power & Light and FPL Group Inc. Evanson will be succeeded by Michael W.

Frontlines

The other day I heard a short news item on National Public Radio that made me stop and think. The item ran something like this: "Maxwell House has announced it will cut the price of its loose ground coffee to reflect a drop in the coffee futures market several months out."

Wasn't that easy? Call it integrated resource planning in the espresso lane. Note what Maxwell House did not do. It did not solicit a demand forecast or run the PROMOD computer model.

How Stranded Will Electric Utiliites Be?

Stranded commitments (SC), because they are potentially huge, may be a show stopper for increased competition in the U.S. electricity industry. Utility shareholders, industrial customers, and small commercial and residential customers are likely to wage tough battles before state and federal regulatory commissions as they seek to reduce their exposure to these costs.

APPA Asks NARUC to End Rate Secrecy

In a letter to Ronald Russell, chair of the Electricity Committee of the National Association of Regulatory Utility Commissioners, Larry Hobart, executive director of the American Public Power Association, argues that investor-owned utilities should not be allowed to keep rates confidential. Hobart says that rate secrecy destroys electric industry competition and that secret sales are a form of predatory pricing barred by antitrust law. He also claims that secrecy violates consumers' right to know if they are paying their fair share of utility costs.