Entergy

Five utilities suing the Tennessee Valley Authority for allegedly making electric sales to unauthorized third parties for resale outside its service territory have agreed to a joint settlement.

The settlement calls for TVA only to sell or deliver power to authorized exchange power companies. TVA agreed not to knowingly enter any exchange power transactions if the purchaser buys that power intending to resell it at wholesale to an unauthorized entity. TVA will reiterate its contract requirements with its exchange power companies.

My electric company, Potomac Electric Power Co., has announced a joint venture with RCN Corp. of Princeton, N.J., to offer local and long-distance telephone service to callers in Washington, D.C., and nearby areas, plus cable television and high-speed connections to the Internet. With stockholder money, PEPCO would compete head-on against Bell Atlantic, which won approval from the Federal Communications Commission on Aug. 14 for its $25-billion merger with NYNEX.

Reporting the story, The Washington Post quoted PEPCO President John M.

In aiming to make financial statements more meaningful, will FASB instead make them indecipherable?

By mid-summer, a total of 123 companies had cranked out some 574 pages of comments, detailing exactly what they thought of the accounting rules proposed by the Financial Accounting Standards Board to cover the closure or removal of certain long-lived assets. %n1%n The FASB's"Exposure Draft," issued early last year, had requested comments on eight issues. The respondents answered as requested, but also raised a host of new questions.

Do mergers and "critical mass" really make a difference? The answer, it seems, is yes.

To become more competitive, U.S. electric utilities have embarked on a quest in recent years to improve operational efficiency and factor productivity. The question is: Are utilities making progress? And, which companies have gained a competitive edge? Which have not?

Industry analysts have long argued that given the structure of the markets they serve and their cost-based, rate-setting procedures, electric utilities tend toward monopolistic behavior.

Five utility companies have filed a lawsuit in U.S. District Court in Birmingham against the Tennessee Valley Authority to bar it from making sales to unauthorized third parties for resale outside TVA's service territory, claiming such sales violate the TVA Act.

"TVA is under more intense attack from private utilities than at any time in its history," said TVA Chair Craven Crowell at an April 15 at a meeting of the TVA Caucus in Washington, D.C.

Some states have become well-known for their regulatory or legislative initiatives on electric restructuring and customer choice. Among those drawing the greatest attention are California, New Hampshire, Rhode Island, Massachusetts, New York, and Texas.

At press time, reports were filtering in of legislation about to be introduced in Montana and North Carolina (em states that might be considered unlikely subjects for competitive initiatives.

CMS Energy Corp.'s energy marketing unit, CMS Marketing, Services and Trading, hired David B. Geyer as v.p., risk management. Geyer's responsibilities include hedging, arbitrage and trading. CMS Generation Co.'s contract with Thailand's AMATA-EGCO Power Ltd., prompted the promotion of W. David Carni from operations superintendent to operations and maintenance plant manager.

Walter J. Gilbert, Volunteer Energy Corp. v.p., will head the company's newly opened office. Gilbert's added duties include special projects relating to gas acquisition, gas purchasing and marketing.

Calling a proposed Securities and Exchange Commission rule contrary to public policy and law, as well as a "de facto repeal of major provisions of the Public Utility Holding Company Act of 1935," the City Council of New Orleans has asked the Securities and Exchange Commission to withdraw its proposed Rule 58.

"For more than 60 years, PUHCA has shed light on the activities of utility holding companies," said Council President James M. Singleton.

XENERGY Inc. and the Electric Power-Research Institute will team up in a second phase of a retail-wheeling pilot program study. The expanded study will include California, Massachusetts, Illinois and New York. Competitors, market share and sales strategies will be assessed. XENERGY first started the survey in July 1996. More than 40 utilities sponsored the research. The first phase focused mostly on New Hampshire, but also targeted electricity deregulation in the 50 states. Phase two, focusing on commercial-industrial customers, ends June 1997.

Myth 1. RTP increases the utility's costs and revenue requirements. %n1%n

Reality 1. A well-conceived RTP program reduces the utility's costs and revenue requirements.

RTP programs can reduce peak demands for power, increase off-peak demands, and reduce the need for additional peak-load capacity. This increase in efficiency can lead both to higher company profits and greater customer savings. As the electric industry becomes more competitive, these savings will flow to those customers most responsible for lowering the utility's costs.