NARUC

MAINE YANKEE PRUDENCE. The Maine Public Utilities

Commission will investigate the prudence of Maine Yankee Atomic Power Co.'s decision to close its nuclear plant permanently.

The PUC said Oct. 22 that unrecovered investment in Maine Yankee combined with the loss in plant value could cause additional stranded assets for plant owners Central Maine Power Co., Bangor Hydro-Electric Co., and Maine Public Service Co. If imprudent action is found, the PUC said it would take steps to ensure that Maine's electric ratepayers do not bear any related costs.

A SUNDAY AFTERNOON, NOT THREE WEEKS 'TIL CHRISTMAS, and I was holed up at Washington's Mayflower Hotel, attending a workshop (no Santa, no elves) on electric transmission pricing.

I wasn't alone, however. At least 200 others had filled the hotel's East Room near to capacity to hear about such topics as nodes, zones, access charges and load duration curves. The 5th National Electricity Forum, sponsored by the U.S. Department of Energy and the National Association of Regulatory Utility Commissioners, was under way.

I sincerely appreciate your covering NARUC and its outlook in the July 15, 1997, issue of PUBLIC UTILITIES FORTNIGHTLY (p. 26). I believe your summarization of my conversation with your Associate Editor and his depiction of NARUC sends a clear message about the unmatched resources and capabilities our organization enjoys by virtue of its membership.

Overall, the article generally captures the essence of our conversation. Nevertheless, it missed on my characterization of the NARUC staff's intended role with respect to the revitalized Washington Action Program.

The National Association of Regulatory Utility Commissioners has elected Susan F. Clark, commissioner of the Florida Public Service Commission, as its representative on the North American Electric Reliability Council. Clark has served as Florida's commissioner since 1991. Commissioner of the North Carolina Utilities Commission, Allyson K. Duncan, also was elected to serve as a NARUC representative. Duncan will represent NARUC on the advisory council to the board of directors of EPRI.

Tony A. Prophet, former new business development v.p.

"When they come to town ... we'll ... accompany them to Capitol Hill ... to make their trip to Washington a 'two-fer,' if you will."

Paul Rodgers knocked NARUC on its ear last July when he announced his resignation as executive of that century-old association.

Rodgers, also general counsel, had served the National Association of Regulatory Utility Commissioners for more than 30 years.

His unexpected move came in the midst of strategic planning at NARUC.

Central Vermont Public Service Corp. hired former Electrolux Corp. CFO Douglas D. Sinclair as its marketing and business development v.p. and general manager. In addition to his new position, Sinclair will oversee day-to-day activities at two power generation and technology subsidiaries. Also at CV, Robert G. Clarke, president of Vermont Technical College, and Patrick J. Martin, president of America's Customer Operations at Xerox Corp., were elected to the board of directors.

John F. Cotter, former PECO Energy Co. power trader, was hired by Pennsylvania Power & Light Co.

New Environmental Technologies Inc. agreed to acquire Keystone Energy Services Inc. The new company will be called Keystone Energy Services. In an alliance with New Energy Ventures Inc., it plans to target the $22.5-billion California electric market. Keystone will re-sell part of the $500 million worth of power New Energy Ventures recently agreed to buy from the Bonneville Power Administration. Keystone will focus on small- to medium-sized electric consumers while its partner will target industrial, commercial and government accounts.

Touted as a panacea for stranded costs, securitization would forever shield rates from market scrutiny.

We consumers display an amazing talent to squander the fruits of our labor on the whim of the moment. Examples might include bungee jumping, vanity license plates or pet rocks. Or just about anything you might find in a magazine stuffed in the back of an airline seat.

Now make way for electric utility restructuring, where the latest fashion calls for securitization of uneconomic costs.

Do electric utilities understand how to earn profits for shareholders in a competitive market?

Here's one way to look at the problem. Gather a group of financial experts and ask this question: If a company's long-term bonds are rated AA, and yield 8 percent, what minimum return would you require from dividend yield and price appreciation to induce you to buy that company's stock?

The typical expert will say 12 percent, indicating a 4-percent premium (or spread) above AA bond yields.

Former Sen. Alan K. Simpson (R-Wyo.) has joined the PacifiCorp board of directors. Simpson retired from the Senate earlier this year after serving three terms. Also at PacifiCorp, Dennis Steinberg, a senior v.p., was named head of global energy sales, marketing and trading. John Bohling, another senior v.p., will direct customer service, among other activities. Mike Henderson will head a new group for international business, technology and planning.

John M. Deutch has returned as a member of the CMS Energy Corp. Board of Directors. Deutch served on the board from 1986 to 1993.