Become a PUF Member Organization

Fortnightly Magazine - January 1 1997

Is Competition Lacking in Electric Generation? (And Why It Should Not Matter)

Incumbent monopolists won't command high premiums

if newcomers can rebuild capacity from scratch at a cheaper price.

At first glance, many of the nation's regional markets for wholesale electric generation appear monopolistic. In some of the 18 regional power markets we have identified, the leading companies account for 75 to 90 percent of the area's generating assets. In other markets, where the concentration problem does not yet seem as pressing, mergers and acquisitions threaten to raise levels of concentration of ownership in generation.

Byline: 
Judah Rose, Shanthi Muthiah, and Maria Fusco
Read Entire Article

Price Behavior in Electricity Futures: The Story So Far

What do the first months of trading say about the spread between spot markets and futures prices?

ust over nine months ago the New York Mercantile

Exchange opened trading in the first-ever electricity futures contracts. As occurred

previously in oil and gas, futures trading in electricity

promises to play a central role in

commodity markets (em markets that are gradually evolving as competitive.

Electricity futures also provide a valuable tool for managers at utilities or other power producers.

Byline: 
Anna Godlewska, Antonio S. Mello, and John E. Parsons
Read Entire Article

Frontlines

Ever since word hit the street last July that Portland General Electric Co. (PGE) would merge with gas industry giant Enron, the news has been rather one-sided. It's been "Enron this" and "Enron that." From reading the papers one might think Enron, with its strong reputation as a commodities trader, was buying an entire electric utility simply to take a bigger position on the NYMEX futures market.

Byline: 
Bruce W. Radford
Read Entire Article

People

Peter R. Thomas was hired from Sprint as v.p. of American Electric Power's new communications subsidiary, AEP Communications, Inc.

Central Illinois Light Co. hired Todd Severson as human resources v.p. He comes from Remco, a subsidiary of Thorn Americas.

Scott A. Neitzel, a member of the Wisconsin Public Service Commission since January 1992, has resigned. Neitzel chaired the PSC's electric utility industry restructuring committee.

Ohio Edison Co.'s board of directors elected chairman and CEO Willard R. Holland as its chairman.

Read Entire Article

Joules

The Texas PV Coalition has been formed to speed commercial availability of photovoltaic systems as a service alternative to extending utility lines. The coalition, which will be managed by Planergy, Inc., an independent energy service company, includes Rio Grande Electric Cooperative, Inc.; Wise Electric Cooperative, Inc.; Tri-County Electric Cooperative, Inc.; and Lubbock Power & Light. Funding to the tune

of $250,000 was provided by the Utility Photovoltaic Group (backed by the U.S. Department of Energy) and the Texas State Energy Conservation Office.

Read Entire Article

Vermont Opts for Choice in 1998

The Vermont Public Service Board (PSB) has issued its draft utility restructuring plan, proposing competitive wholesale and retail markets for generation with regulated monopolies for transmission and distribution (Docket No. 5854). The state's largest investor-owned utilities would be required to functionally separate their generation and distribution functions into corporate subsidiaries.The plan builds on the Vermont Restructuring Principles adopted by the PSB last May.

Retail customer choice is scheduled as early as January 1, 1998.

Byline: 
Lori A. Burkhart
Read Entire Article

Nuclear Power: Taking the Long View

Nuclear Power:

Taking The Long View

In today's market, with competition imminent and natural gas still cheap, nuclear generation appears dicey. The popular view tags nuclear with high costs and suspect availability, even without reaching the more fundamental issues of safety and waste disposal. One wonders: What advantages lie open to nuclear power?

Many observers see excess capacity running rampant and commodity prices falling across the board as deregulation accelerates and power flows more freely across markets and service territories.

Byline: 
Lewis J. Rubin
Read Entire Article

Nuclear Power: Ask a Contrarian

No one needs to tell the readers of PUBLIC UTILITIES FORTNIGHTLY about the technical, economic, regulatory, and institutional obstacle course facing the nuclear power industry. All you need do is look around to see an industry struggling to live up to expectations. Some would term the nuclear outlook "grim:"

• No economic incentives to build new nuclear plants.

• No new plant orders in the United States (a modest complement of foreign orders)

• Precious few attempts to renew operating licenses; even fewer succeed.

Byline: 
William H. Timbers,Jr.
Read Entire Article

Financial News

Targeted Debt: Give the Stockholders What They Want

Too much leverage can be risky, but sometimes it's just what the doctor ordered.

One of the reasons that stockholders in Columbia Gas survived a Chapter XI proceeding more nearly intact than owners of other bankrupt utility enterprises was that the parent holding company was a secured creditor of its operating subsidiaries at the time of the filing.

Byline: 
J. Michael Parish, Richard S. Green and Stephen H. Kinney
Read Entire Article

Special Report

Talk runs gamut from "rocket docket" to "Just go slow." A merger announcement kickstarted NARUC's annual conference last year. This year, in San Francisco, there was little difference in conference chatter. Only this time, MCI Communications Corp. and British Telecommunications Plc were the suitors, in a $20 billion corporate marriage.

Regulators had better get used to the "M" word, noted speaker John E. Hayes, Jr., chairman of Western Resources Corp.

Byline: 
Joseph F. Schuler, Jr.
Read Entire Article
V