PECO

Electronic Trading: Toward a Mature Power Market

A MASSIVE, WORLD WAR I-era building in downtown Baltimore houses Constellation Power Source, an unregulated, wholly owned power-marketing subsidiary of Baltimore Gas and Electric Co. Upon introducing the new company in February, BG&E announced that Goldman Sachs would serve as "exclusive advisor" for the start-up.

Later, when asked to clarify the relationship between the two companies, Charles W.

Information Technology for Utilities

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.

Frontlines

THE POSSIBILITIES ARE ENDLESS," SO THE ADS SAY.

But what about a hostile bailout? I wouldn't have believed it myself until the news arrived, forcing me to rewrite this column at press time.

Imagine: Enron offering to reimburse PECO Energy for $5.4 billion in stranded costs, while taking on the role as the electricity provider of last resort for southeast Pennsylvania.

No doubt you have already read a half-dozen news stories about Enron's play for PECO. The details should sound familiar; the Philly papers were filled with lively quotes. On Oct.

OASIS Problems, Solutions Brought to FERC's Attention

The Federal Energy Regulatory Commission invited industry representatives to Washington, D.C., in July to talk about the electric utility industry's implementation of OASIS, or open-access, same-time information system, which is used to monitor and schedule electric transmission capacity.

It ended up with an earful about problems on the on-line system.

Gerry Cauley, of the industry's volunteer "How Working Group," said, "Overall, the OASIS does provide comparable access," and the system is seeing reservation activity at expected levels.

NEES to Hold First Auction

New England Electric System has selected 12 companies from the U.S. and Europe to take part in an auction to supply electricity to Massachusetts and Rhode Island "standard offer" customers when retail competition begins.

Standard-offer service is set at seven years in Massachusetts and 12 years in Rhode Island. When competition begins, slated for Jan. 1, 1998 in both states, consumers can choose a new energy supplier through the standard offer.

People

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.

An East Coast View: The Right Price for PJM

Locational marginal pricing, even if "complex," is well worth the benefits.

In two recent issues, PUBLIC UTILITIES FORTNIGHTLY featured editorials %n1%n on restructuring of the PJM Pool. Those two articles described proposals by the so-called supporting companies, %n2%n seven members of the Pennsylvania-New Jersey-Maryland Interconnection, to use a "locational marginal pricing" model for congestion pricing for electric transmission and to continue PJM as a "tight" power pool.

OASIS Problems, Solutions Brought to FERC's Attention

The Federal Energy Regulatory Commission invited industry representatives to Washington, D.C., in July to talk about the electric utility industry's implementation of OASIS, or open-access, same-time information system, which is used to monitor and schedule electric transmission capacity.

It ended up with an earful about problems on the on-line system.

Gerry Cauley, of the industry's volunteer "How Working Group," said, "Overall, the OASIS does provide comparable access," and the system is seeing reservation activity at expected levels.

Far From Closure: No Consensus Yet on Accounting Proposal for Decommissioning

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.