Charles River Associates

FERC At 25

A leaner bureaucracy sharpens its market-monitoring tools.

FERC turns 25 this year. With Enron’s collapse and California’s unraveled electric restructuring scheme, the silver anniversary reminiscing may be slightly muted.

People (Feb 1, 2002)

National Fuel Gas Co. elected Philip C. Ackerman to chairman of the board. Roy McAllister has joined Mirant as senior vice president, external affairs. Chesapeake Utilities Corp. appointed three new members to its board of directors. And others ...

News Digest

State PUCs

STRANDED COST RECOVERY. The Pennsylvania Public Utility Commission allowed Pennsylvania Power & Light Co. to recover $2.9 billion of a requested $4.5 billion in stranded costs, cutting a higher $4-billion allowance proposed earlier by an administrative law judge. The utility petitioned for reconsideration on June 26, after CEO William F. Hecht had called the decision "unacceptable," and noting that the PUC's written order, received June 15, appeared "even more injurious" to the company that the PUC's June 4 bench order.

Special Report

DOES THE KYOTO CLIMATE CHANGE TREATY POSE A SEVERE threat to the U.S. economy or is that claim simply a "Chicken Little" prediction of detractors?

Pro-business Republicans, environmentalist bureaucrats and industry observers debated the merits of each position at the Ninth Annual Energy Efficiency Forum in Washington, D.C., on June 10.

One of the most vociferous opponents of the treaty was Rep. F. James Sensenbrenner Jr. (R-Wisc.), chairman of the House Committee on Science, who headed the Congressional delegation to Kyoto, Japan.

Other speakers included Ambassador Stuart E.

The Cost of Reducing SO2 (It?s Higher Than You Think)

LAST YEAR, IN JUSTIFYING THE PROPOSED NEW NATIONAL AMBIENT Air Quality Standards (NAAQS) for particulate matter and ozone, Environmental Protection Agency Administrator Carol Browner testified that: "During the 1990 debates on the Clean Air Act's acid rain program, industry initially projected the costs of an emission allowance¼ to be approximately $1,500¼ Today those allowances are selling for less than $100." %n1%n

Later in 1997, at the White House briefing announcing President Clinton's Global Climate Change Plan, Katie McGinty, chairwoman of the Council on Environmental Quality, sa

Gas-fired Generation: Can Renewable Energy Reduce Fuel Risk?

Some in Congress would link customer choice with a portfolio standard. How would that play in a wholesale power market where gas turbines rule the roost?

By Michael C. Brower and Brian Parsons

WHAT KINDS OF POWER PLANTS WILL

get built in a deregulated electric industry? If recent history offers any guide, utilities and independent power companies will succumb to the traditional wisdom and invest in gas-fired combustion turbines and combined-cycle plants. Sound reasons may exist for doing so. The plants are less expensive than conventional steam plants. They put less capital at risk.

Price Behavior in Electricity Futures: The Story So Far

What do the first months of trading say about the spread between spot markets and futures prices?

ust over nine months ago the New York Mercantile

Exchange opened trading in the first-ever electricity futures contracts. As occurred

previously in oil and gas, futures trading in electricity

promises to play a central role in

commodity markets (em markets that are gradually evolving as competitive.

Electricity futures also provide a valuable tool for managers at utilities or other power producers.

Frontlines

Summer's coming. Time for a breather, right? I only wish it were so.

Since the Federal Energy Regulatory Commission (FERC) issued its electric "giga-NOPR" on transmission access, stranded investment, and Real-time Information Networks (RINs), the heat is on (em and rising. Congress is busy, too. It's working hard on telecommunications, nuclear waste, and privatization of the federal power marketing agencies, but the odds may be growing against repeal of PURPA (the Public Utility Regulatory Policies Act) or PUHCA (the Public Utility Holding Company Act.