Idaho Power

TELCO UNIVERSAL SERVICE FUND. Reversing an appeals court, the Kansas Supreme Court upheld a decision by the Kansas Corporation Commission that had required wireless telecommunications carriers to contribute to the state's universal service fund. It also affirmed a KCC ruling setting the initial amount of the fund in a roundabout way based on equalizing inter- and intrastate long-distance rates.

The KCC order (issued Dec. 27, 1996) had slashed intrastate toll rates by $111 million over three years. It then cut access charges by an equal amount to offset the loss to toll carriers.

MICHIGAN CHOICE APPEAL. Michigan Attorney General Frank Kelley filed an appeal in the Michigan Court of Appeals of the Michigan PSC's Jan. 14 rehearing order (News Digest, March 15, 1998, p. 18) adopting a phase-in schedule for electric restructuring and retail choice for Consumers Energy and Detroit Edison. Kelley alleged that the order fails to create a competitive generation market or foster lower rates. He called it an "outrage," that gave the utilities everything they wanted. Case Nos. u-11290 et al., Feb. 13, 1998 (Mich.P.S.C.).

NEW HAMPSHIRE RESTRUCTURING. The U.S.

WHETHER YOU CALL IT "DEREGULATION" OR "re-regulation," the promised move to competition does not mean less regulation - at least not any time soon.

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.

IN THE DRIVE TO MATCH INFORMATION TECHNOLOGY SYSTEMS WITH THE

demands of "deregulatory" standards, utilities are investing billions in information technology (em some launching new business lines from their experience.

Worldwide, utilities are investing $20 billion; electric utilities pony up the most: $12 billion each year, according to Newton-Evans Research Co. An average U.S. electric utility will invest $43 million this year; a gas utility will invest $9 million.

The Idaho Public Utilities Commission has rejected a request by Idaho Power Co. to include a "public purpose charge" in ratepayer bills to fund its participation in the Northwest Energy Efficiency Alliance.

The utility said that the goal of the new organization is to transform existing energy markets to permit improvements in energy use efficiency without the need for long-term utility incentives.

The commission permitted the utility to capitalize and defer the costs of its investment in the organization until additional information is available.

Aquila Energy, a subsidiary of UtiliCorp United, has hired David H. Stevenson former marketing v.p. of Duke/Louis Dreyfus, as v.p. power marketing for its mid-continent and western regions.

Charles Falcone, who retired as American Electric Power's system power markets senior v.p., was named project managing director of the New York State Power Pool's Independent System Operator. Falcone served as an official with the U.S. Department of Energy for several years before joining AEP.

Ohio Electric Utility Institute has elected William J. Grealis as board chair and president.

The Idaho Pubic Utilities Commission has approved two new electric market experiments to test a market-based pricing tariff proposed by one electric utility and a direct-access pilot program proposed by another.

Market-based pricing. It authorized Idaho Power Co. to offer industrial customers, on an experimental basis, the option of purchasing power under a market-based rate schedule. Customers who contract for 5 to 10 megawatts of firm demand at one delivery point qualify for the pilot tariff program.

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.