Fortnightly Magazine - November 15 1995

antitrust lawsuit against Florida Power & Light Co. (FP&L), alleging that FP&L denied equal access to its electric transmission network. FMPA represents 10 municipal utilities, which pay FP&L for access to transmission lines. FMPA claims that FP&L violated antitrust laws by restricting network access and inflating access costs. FP&L says it offered transmission access to the municipalities, but the parties cannot agree on a price.

In electric power, telecommunications, water, and natural gas, the costs of local distribution make up a significant share of the cost of providing services. For any network or system, the cost of distribution facilities is largely or entirely independent on usage; i.e., such costs are largely invariant to the number of phone calls, kilowatts, British thermal units (BTUs), or gallons that customers use.

The West Virginia Public Service Commission (PSC) has issued a series of legal rulings favoring Energy America, Inc., developer of a qualifying cogeneration facility (QF), in a complaint proceeding to enforce Wheeling Power Co.'s power-purchase obligation under the Public Utility Regulatory Policies Act of 1978 (PURPA). The PSC ruled that Wheeling should be viewed as a stand-alone company, not a part of the American Electric Power (AEP) system as alleged by the utility.

A U.S. House-Senate conference committee may remove a provision in present law that requires the Department of Defense (DOD) to buy electricity solely from its local distribution company. The House of Representatives has already voted DOD (300 to 126) the right to buy electricity from the most economical source. A first step toward allowing retail wheeling for military bases, the provision is part of the House fiscal year 1996 Defense Authorization bill.