Fortnightly Magazine - March 1 1997

New York Power Authority trustees have approved agreements to help it establish an independent system operator for the statewide electric transmission system, which could be partially implemented in 1997, and fully implemented by mid-1998, if approved by the Federal Energy Regulatory Commission.

Members of the New York Power Pool, the authority and the state's seven investor-owned utilities have worked for nearly two years to develop a proposal for an independent system operator, or ISO. The proposal and associated tariffs were submitted to the FERC.

The Pennsylvania Public Utilities Commission has approved final guidelines for electric utility pilot programs for Pennsylvania's transition to a competitive retail electric generating market. The pilots will allow a limited number of residential, commercial and industrial customers to choose their electric suppliers.

The "Electricity Generation Customer Choice and Competition Act," signed into law by Gov. Tom Ridge Dec. 3, 1996, requires participation in the pilots by customers representing 5 percent of a utility's peak load for each customer class.

The Oregon Public Utilities Commission staff has recommended the proposed merger of Portland General Electric Co. and Enron Corp. be approved with conditions, and has asked for a customer-rate reduction of $47.4 million for four years.

Subsequently, an $11.2-million rate-reduction component would remain part of electric rates until PGE's next rate proceeding. The staff would include a feature to true up rate-reduction amounts if certain future revenues exceed expectations.

Central and South West Corp. President and CEO Dick Brooks is "extremely disappointed" with a proposed decision by an administrative law judge to increase annual revenues of its subsidiary, Central Power and Light Co., by $7.2 million. CPL in November 1995 had asked for a $71-million hike in retail rates.

A significant factor contributing to the difference is that the judge recommends reducing return on equity from 12.25 percent to 10.9 percent, which would reduce the rate increase by $30 million.