CONSUMER FRAUD. The National Association of Attorneys
General, meeting Nov. 18 in Washington, D.C., to discuss electric restructuring, issued a warning to electric consumers on fraudulent schemes and abusive practices by scam artists. The warning encourages consumers to check their electric bills for unusual provider names or charges, and to avoid participating in contests that require a signature that can be used to switch an account.
RATE REDUCTION BONDS.
THERE ARE NO FUNDAMENTAL FLAWS. Our systems are functional."
So said CEO Dennis Loughridge, of the California Power Exchange, in announcing nevertheless on Dec. 22 that the opening of the state's day-ahead electricity market, planned originally for Jan. 1, would be delayed because software and systems testing could not be completed satisfactorily.
"California's electron highway is the fifth largest in the world. We need to take the time to make the transfer¼ seamless," added Gary Heath, executive director for the state's electricity oversight board.
WE HAVE SEEN THE FUTURE AND IT IS THE HOURLY pricing of electricity.
In California, the power exchange serves as the cornerstone for a restructured electric industry. The raison d'être of the PX is to reveal the hourly marginal cost of electricity. Now add PJM to the list. Like California, an integral aspect of the restructured Pennsylvania-New Jersey-Maryland Interconnection, as approved by the Federal Energy Regulatory Commission by order dated Nov. 25, 1997, is the mid-Atlantic market, which intends also to fix an hourly price for electricity.
WHETHER YOU CALL IT "DEREGULATION" OR "re-regulation," the promised move to competition does not mean less regulation - at least not any time soon.
A recent article laments the slow pace of retail competition for residential gas sales in New York ("Blue Flame Blues: Gas Pilots Sputter at Burnertip," Oct. 1, 1997, p. 22). Besides the meager financial incentive for a New York residential customer to switch gas companies, there is another factor contributing to the slow headway being made by gas marketers: The New York Public Service Commission failed to establish a level playing field with just and reasonable terms of sale.
WITH DIRECT ACCESS SCHEDULED TO BEGIN ON Jan. 1, 1998, California regulators are moving quickly to set up their long-considered policies on electric restructuring. The restructuring actions touch nearly every aspect of electric regulation in the state from financing decisions and rate design to the sale of generating assets and monitoring new capital additions.
In addition, restructuring has affected ongoing regulatory activities such as the development of performance-based rate making plans and pricing and rate designs for large incumbent utilities.
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.
THERE IS MUCH TALK ABOUT CONVERGENCE.
The Federal Energy Regulatory Commission asks, "What needs to be done to enable the gas and electric markets to work together to become more integrated?" The real question is more direct: "How can the gas industry transform what is presently, at best, a daily market, with daily procedures, to an hourly or quarter-hourly electric generation business and gain benefits at the same time?"
Will the answer come from hourly gas trading and pricing?
The New Mexico Public Utility Commission has authorized Public Service Company of New Mexico to launch a major new program to help small-volume end users take advantage of alternate gas supply sources.
The action follows an investigation by the commission of an offer by the utility to exit the gas merchant function.
Under the new program, small customers can purchase gas from a list of qualified marketers beginning with the first billing cycle for December 1997.
Expressing concern about price volatility in the natural gas market, New Jersey, Virginia and Michigan regulators have directed local gas distribution companies to try fixed-price contracts and other hedging instruments. This would allay risk in wholesale gas supply portfolios and protect residential ratepayers from price swings common in the winter heating season, regulators said.
The growing popularity of fixed-price and other financial instruments to hedge against price spikes follows two winters of volatility noticed by regulators nationwide.
New Jersey.