Wyoming and Montana
are cracking Midwest coal markets,
despite local protectionism.
As pressures build steadily toward deregulation and increased competition between electric power generators, Western low-sulfur coal is emerging as the most economical fuel option for an increasing number of companies. The low cost of delivered fuel and avoidance of capital outlays offer attractive savings.
As regulators continue to investigate industrywide restructuring as an answer to regional electric rate disparities and calls from large consumers for price reductions, the trend of dealing with the problem through rate discounting also remains strong. Regulators have taken steps to ensure that shareholders bear at least some of the risk for revenue shortfalls that might result under the new contracts.
Consumers Power Co. has entered into long-term sales contracts with General Motors Corp. (GM) to supply all electricity for at least 10 years to 6 of GM's largest plants, and for at least 5 years for 13 of GM's other large facilities (total service of 450 megawatts).The facilities, which account for 65 percent of the utility's "at-risk" industrial electric load and 22 percent of its industrial load, will receive rate discounts in exchange for the long-term commitments.
Mirroring an earlier opinion by a federal district court, the Indiana Court of Appeals has struck down a state law that allowed regulators to offer special rate treatment and construction project preapproval to utilities that develop clean air compliance plans that would maximize the use of high-sulfur coal mined in the state. The court remanded the case to the Indiana Utility Regulatory Commission and agreed with a prior finding by the U.S. District Court (S.D.
The Michigan Public Service Commission (PSC) has reaffirmed its earlier approval of special manufacturing contracts submitted by Detroit Edison Co. to supply power to Chrysler Corp., Ford Motor Co., and General Motors Corp. Opponents had argued that the PSC erred by approving the price discounts while deferring consideration of their rate treatment as well as their effect on existing competitive programs.
Detroit Edison Co. (DE) has received approval from the Michigan Public Service Commission for
10-year sole-supplier contracts for electric power and related services with Chrysler, Ford, and General Motors. (Case No.
U-10646). DE is believed to be the first utility in the nation to secure such agreements for an entire industry in its service territory
The almost identical contracts involve a
1,000-megawatt combination of firm and interruptible power, giving rate discounts to the automakers.
Who will pay the costs incurred by regulated utility companies as they shift to competitive markets under plans engineered at the federal and state levels? This question is part of the debate over electric industry restructuring, but any payments lie in the future. For ratepayers in the gas market, however, the time has come. So far, state regulators have interpreted the law as prohibiting any sharing of gas market "transition" costs between shareholders and ratepayers.
Who will pay the costs incurred by regulated utility companies as they shift to competitive markets under plans engineered at the federal and state levels? This question is part of the debate over electric industry restructuring, but any payments lie in the future. For ratepayers in the gas market, however, the time has come. So far, state regulators have interpreted the law as prohibiting any sharing of gas market "transition" costs between shareholders and ratepayers.
The Michigan Public Service Commission (PSC) will require Energy Michigan (em a nonprofit corporation whose members promote expanded use of cogeneration, IPPs, and waste-to-energy projects (em to provide Consumers Power Co. with information concerning the extent of existing and proposed self-generation projects that pose a competitive threat. The PSC directed Energy Michigan to answer interrogatories served by Consumers after Energy Michigan intervened in a proceeding concerning a new "competitive tariff" proposed by the utility.