PURPA

Perspective

Electric industry restructuring is progressing at a rapid pace. Across the country, states are moving ahead to encourage retail competition. Two states have allowed retail wheeling experiments (Michigan and New Hampshire), utilities are proposing them, and over 20 states are studying the issue. Back in Washington, Congress is examining legislation to amend the Public Utility Holding Company Act (PUHCA).

Electric Restructing and the California "MOU"Alex Henney

The California Memorandum of Understanding (MOU) is an agreement between Southern California Edison Co. (SCE), the California Manufacturers' Association, the California Large Energy Consumers' Association, and the Independent Energy Producers. It tackles three major issues:s recovery of stranded assets

s market power

s market structure.

If the MOU is eventually endorsed, it might be a landmark in electric restructuring \(em and not only in California.

Perspective

One of the iron rules of competition and open markets is that there are winners and losers. Winners tend to win very big; losers tend to lose everything and disappear, through absorption or insolvency. As deregulation takes hold, high-cost producers and less adroit managers may find themselves steamrollered by emerging strongmen and entrepreneurial upstarts. These rivals may usurp segments of their business by bidding the job cheaper and still making money, leaving a rising tide of shareholder suits in their wake.

Can the FERC Overcome Special Interest Politics?Jim Rossi

The competitive transformations of the natural gas and telecommunications industries are over a decade in the making. By contrast, competition in the electricity industry is still emerging. Special interests have defeated many proposed competitive reforms. For example, in 1988 the FERC failed in its attempt to adopt regulations to encourage competitive bidding and independent power producers (IPPs).1 Similarly, decades of forceful industry opposition delayed open access in bulk-power markets.

Electric Restructuring: NOt by FERC AloneVito Stagliano

The restructuring of electric utilities is fundamentally a matter of national policy (em not a regulatory issue. Regulators are ill-suited to make national policy because they are conditioned to act within the limits of authority specifically granted by legislation, rather than to seek a fresh statutory mandate in response to changed conditions. Policymakers must assess political, social, economic, technological, regional, and national factors to measure the need for reform.

Electric Industry Restructuring: The States Forge Ahead

About 30 states have begun (em

either through the legislature, the utility commission, informal working groups, or some combination of these (em to consider issues such as retail wheeling, unbundled utility structures, and alternative rate regulation.1 California's "Blue Book" hearings have drawn the most attention, but significant efforts are also underway elsewhere. Although each state is approaching the issue in its own way, successful industry restructuring will ultimately require coordination across state lines.

Perspective

For almost a decade now, the Federal Energy Regulatory Commission (FERC) has pursued the goal of promoting competition in bulk-power markets, focusing on access to transmission as its primary tool to achieve that end. This trend first emerged in the 1987 PacifiCorp merger case. It gained momentum with the strong message sent by the Congress in the Energy Policy Act of 1992 (EPAct).

Gas-Fired Generation

Stephen P. ReynoldsPresident & CEO

Pacific Gas Transmission Co.

Two or three years ago, gas-fired generation was hailed as a cure-all for everything that ailed the natural gas industry.

Perspective

Recently I had the opportunity to testify before the Subcommittee on Energy Production and Regulation of the U.S. Senate Energy and Natural Resources Committee on legislation that would repeal the Public Utility Regulatory Policies Act (PURPA). During the course of the hearing, Sen. Bennett Johnston (D-LA) made a comment that framed perfectly the

federal-state tensions currently affecting energy regulatory policy in America.

Sen.