The Minnesota Public Utilities Commission has adopted a schedule of environmental costs for electric utilities evaluating and selecting resource options in all commission proceedings including resource-plan and certificate-of-need cases.

In each such case the utilities will be required to provide three cost analyses for each generation-option provided: one using the values at the low end of the range (see table), one using values at the high end of the range, and one reflecting "direct costs only" (i.e., using zero environmental externalities values).

Table.

The Idaho Public Utilities Commission has allowed Idaho Power Co. to terminate an "industrial efficiency" conservation program designed to promote the installation of energy efficient equipment by both industrial and large commercial users through the use of grants awarded by the utility.

The commission found that the way to implement such goals is changing in light of electric industry restructuring, while declaring its continuing support for utility investment in conservation and renewable-based resources.

Finding that Alabama Power Co. has a clear need for additional capacity in the near future (em reserves for the year 1999 will drop to approximately 9.2 percent (em the Alabama Public Service Commission has authorized the utility to pursue a utility-owned cogeneration project as the least-cost resource option.

The company plans to install a natural gas-fired cogeneration plant at an industrial facility owned by one of its larger customers. The utility will own, design, maintain and operate the

100-MW facility.

Sound bites from state and federal regulators.

Electric Briefs

Environmental Review. California halts work on report of environmental impacts of electric restructuring and new market structure, finding no need for independent review of commission proposals after state Legislature had sanctioned "a more competitive scheme" last summer when it passed Assembly Bill 1890. R.94-04-031, I.94-04-032, Decision 96-12-075, Dec. 12, 1996 (Cal.P.U.C.).

Electric Restructuring.

You've got to reinvest the proceeds (em and not just anywhere.

Recovering stranded investment is sometimes equated to preserving shareholder wealth. In fact, full recovery of stranded investment by itself will not preserve shareholder wealth in most cases.

What is missing all too often in discussions of stranded investment is the role that capital investment plays in the creation of shareholder wealth.

The City of Alma, Mich., has asked the Federal Energy Regulatory Commission to consider whether Consumers Energy is entitled to recover stranded costs from customers in the municipality that switches from CE's system to a municipal electric system if the city creates one.

A consultant hired by Alma already has determined the city could own and operate a municipal utility, which would result in cost savings in excess of 20 percent. The savings estimate has been challenged by CE, formerly Consumers Power Co., because the analysis does not contain a stranded-cost payment.

The Heritage Foundation's recently released report, which finds that national electric deregulation would benefit consumers through lower electric rates, better service and more jobs, has the endorsement of a key policymaker.

If Congress passes a bill to deregulate electric markets, the average consumer's monthly electric bill could fall by as much as $30, according to the report, Energizing America: A Blueprint for Deregulating The Electricity Market, written by Adam D. Thierer.

The report has been endorsed by House Commerce Committee Chairman Thomas J.

The Truckee Donner Public Utility District has asked the Federal Energy Regulatory Commission to resolve an Order 888 transmission dispute with Sierra Pacific Power Co.

Truckee buys most of its power from SPP but wants the freedom to shop around for less expensive electricity from other suppliers. Truckee is located high on the Eastern slope of the Sierra Nevada, within SPP's service territory and is not connected with any other utility.

The Federal Energy Regulatory Commission ruled that the Iowa Utilities Board's decision to implement an Iowa statute, which obligates electric utilities to purchase power from qualified facilities at rates in excess of the purchasing utilities' avoided costs, is preempted by the Public Utility Regulatory Policies Act (Docket No.

The Federal Energy Regulatory Commission set a hearing for a proposal by New England Power Co. to divest its generating assets and add a termination charge reflecting generation costs that will be stranded due to early service termination.

This move, made on Jan. 29, marks the first time the FERC will consider a case-specific proposal for dealing with stranded costs in the context of corporate restructuring proposals, as allowed by Order 888 (Docket No. ER96-2367).