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Fortnightly Magazine - December 1995

Consumers Power Locks Up GM

Consumers Power Co. has entered into long-term sales contracts with General Motors Corp. (GM) to supply all electricity for at least 10 years to 6 of GM's largest plants, and for at least 5 years for 13 of GM's other large facilities (total service of 450 megawatts).The facilities, which account for 65 percent of the utility's "at-risk" industrial electric load and 22 percent of its industrial load, will receive rate discounts in exchange for the long-term commitments.

Byline: 
Lori A. Burkhart
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Telecommunications -- Regulatory Update

State regulators continue to update methods of pricing telecommunications services, using price caps for local exchange carriers (LECs) while expanding existing pricing flexibility for interexchange carriers (IXCs). The emerging trend toward inviting competitors to serve the local market, including basic local exchange service, also continues. Some of the activity mirrors ongoing developments at the federal level, such as major regulatory reforms under debate in the Congress and court-supervised modifications to existing service restrictions stemming from the AT&T divestiture.

Byline: 
Phillip S. Cross
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Ohio Edison Faces Antitrust Suit

Youngstown Thermal (YT), a steam provider, has filed a lawsuit against Ohio Edison Co., seeking more than $3 million in damages for alleged anticompetitive practices. An August 31 ruling by the Ohio Public Utilities Commission (PUC) found that Edison's contract to provide cooling services to the Mahoning County jail allowed for revenues below the utility's actual cost of providing service, and was negotiated for the purpose of destroying competition.

Byline: 
Lori A. Burkhart
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Virginia Approves Gas-supply Cooperative

The Virginia State Corporation Commission (SCC) has approved a plan by two natural gas local distribution companies (LDCs), Washington Gas Light Co. and Delmarva Power and Light Co., to join with other regional LDCs to form a cooperative to provide for the coordination and use of common capacity, storage, transportation, and supply assets. According to the LDCs, the East Coast Natural Gas Cooperative was a necessary response to recent changes in the gas industry, which shifted responsibility for arranging gas supplies from interstate pipelines to LDCs.

Byline: 
Phillip S. Cross
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Perspective

Almost everyone in America has heard of Cal Ripken, Jr. But have you ever wondered what you and the utility industry have in common with him?There are at least three things. Let me tell you how I know.

On September 6, 1995, Cal Ripken broke Lou Gehrig's record of 2,130 consecutive baseball games played. I was privileged to attend that special game at Oriole Park at Camden Yards with my son Michael.

Byline: 
Robert S. Fleishman
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Gas PGA Reforms Stalled

The Missouri Public Service Commission (PSC) has rejected a proposal by customers of Missouri Gas Energy, a division of Southern Union Co. and a natural gas local distribution company (LDC), to modify the LDC's purchased gas adjustment (PGA) clause so that it applies solely to sales customers. The customers had claimed that the structure of the PGA predated provision of transportation service on the system and was currently used as an inappropriate vehicle for collecting nonpurchased gas costs from customers that no longer purchase supplies from the LDC.
Byline: 
Phillip S. Cross
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Marketing & Competing

When the Salt River Project (SRP) held a series of focus groups in 1994, one participant said he related to our products and services, and felt he received good value for his monthly payments. Unfortunately, a few questions later, we discovered that he did not live in our service area, his bill was higher than he thought, and he wasn't particularly pleased after all.

We were more than a little taken aback.

Byline: 
D. Michael Rappoport
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GISB Meeting Brings Promise, Compromise, Light Reprimand

The Gas Industry Standards Board (GISB) has extended its lifespan and broadened its scope to tighten business practices and improve electronic transactions.

At its first-ever annual meeting, held in Baltimore, MD, GISB also was gently chided and commended by James J. Hoecker of the Federal Energy Regulatory Commission (FERC): "I submit to you that GISB must not, in an attempt to please everyone, set standards at the lowest common denominator.

Byline: 
Joseph F. Schuler, Jr.
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PoolCo and Market Dominance

Imagine if the airlines had followed a utility model when they deregulated back in 1978.You and five other planeloads show up at the airport to catch a flight to Chicago. Every few hours the airport operator holds an auction for the next hour's Chicago flights. Delta offers two new 767's at $200 per ticket. U.S. Air bids one 737 at $300. American has six

DC-9's and bids each one at $1,000 per head. When the auction ends, Delta and U.S. Air fill their planes.

Byline: 
Randall J. Falkenberg
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D'Amato Seeks to Replace PUHCA

Sen. Alfonse D'Amato (R-NY) has introduced a bill to replace the Public Utility Holding Company Act of 1935 (PUHCA) with a new holding company act that would give the utility industry greater flexibility. Endorsed by a bipartisan group of senators, the bill is co-sponsored by Frank Murkowski (R-AK), chairman of the Senate Energy and Natural Resources Committee, and J.

Byline: 
Lori A. Burkhart
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