Motivated by numerous consumer complaints regarding substantial, unexpected increases in bills for natural gas service, the New Mexico Public Utility Commission has fined Public Service Company of New Mexico, finding that the utility knowingly understated gas cost data in prior adjustment clause filings to avoid commission review of an ongoing gas price crisis.

The commission suspended the $2.2-million fine, however, in light of its decision to prevent PSNM from collecting more than $1.5 million in purchased gas revenues associated with the understated gas cost projection.

Robert Blohm and Professor William Hogan recently traded op-ed letters in the Wall Street Journal on the "poolco" and "bilateral" models for wholesale power markets:

Writing first, Blohm (an advisor to Ontario's Macdonald Committee on electric competition) praised bilateral trading (individual buyers and sellers agree on price).

New legislation would tackle the most difficult problem (em low load factors for small-volume customers.

We commend the Natural Gas Competition and Deregulation Act, SB 215, passed by the Georgia General Assembly in March. (Governor Zell Miller was expected to sign the bill in April.) The Georgia legislation envisions a new framework for regulating the retail gas market.

But not for long (em as power producers and

customers get more creative in matching plants with loads Dynamic scheduling is a "sleeper" issue in the move toward electric competition. Industry players are debating independent system operators. They are focusing on issues of governance and the form of transmission pricing. Consequently, they are ignoring critical issues concerning ancillary services. These services are not receiving the attention they deserve.

Valuation, optimization and settlement strategies

oth gas and electric utilities face a variety of environmental issues arising from more than 1,500 former manufactured gas plant (MGP) sites, which supplied a major source of energy in the United States from the early 1800s to the mid-1900s. Using the standard operating procedures of the day, MGPs created and often disposed of byproducts such as coal and oil tars, tar/water emulsions, sludges, spent oxides (including cyanides), lampblack, ash and clinker.

Wall Street loves stranded costs. No kidding. For stockbrokers and underwriters accustomed to selling utility issues to widows and orphans, the prospect of asset-backed financing opens a whole new world. I'm talking here about "securitizing" stranded costs.

In a securitization, a trust takes beneficial title to utility assets (tangible or intangible) that have lost their value in the market, and sells "transition bonds" to a new set of investors, funneling the bond sales proceeds back to the utility and to its equity investors. Who pays the coupon? Why, it's the customer of course.

John Yurkanin was appointed senior v.p. of marketing and sales for LG&E Natural. Yurkanin joined LG&E in 1996 and served as senior v.p., producer services. Yurkanin will direct LG&E in expanding marketing presence with utilities and other marketers. Also at LG&E, Mark Stanger was appointed v.p., producer services. Stanger will direct service business, including contracting for new sources of gas supply and managing relationships with current suppliers.

Commissioner Hullihen Williams Moore will serve as chairman of the State Corporation Commission for the next year.

Why We Sign Those Secret Deals

Out here in the trenches, Professor William Shepherd's attempts to correlate anti-competitive pricing strategies with market dominance will take a while to sink in, mostly because the politics seem to get in the way of clear thinking. While his article ("Anti-Competitive Impacts of Secret Strategic Pricing in the Electricity Industry," Feb. 15, 1997, p.

According to a new study we have conducted at Resource Data International, the continuing transformation from a regulated industry to a fully competitive industry will create substantial opportunities for new generating companies. With the implementation of the Energy Policy Act of 1992 and the FERC's Orders 888 and 889, competition has been introduced into wholesale power markets. It is limited in scope, however, as utilities are still able to recover their fixed generation costs and embedded cost of capital from their captive retail markets.

Stone & Webster will lead a consortia building a $109 million geothermal power plant for Amoseas Indonesia, Inc. The project calls for a second and third unit at the Darajat geothermal station, which taps into geothermal fields in the Garut Regency of West Java, Indonesia. Each unit has a capacity of 70 MW. The entire project was set to be finished by early 2000. Stone & Webster's portion of the contract is worth about $40 million.

Westinghouse Electric Corp. contracted to supply a barge-mounted power plant for the Port of Mombassa Power Barge Project in Malaysia.