The Georgia Public Service Commission (PSC) has adopted a set of policy guidelines to restructure and promote competition in local gas markets. The PSC said that a major problem is determining how smaller core customers can benefit: "Reliance on competitive market forces is preferable to regulation," but only when competition is effective and sustainable. To test for competition, the PSC will monitor: 1) the ability of providers to make functionally equivalent service readily available, and 2) the numbers and market strength of competitive providers.

The Ohio Public Utilities Commission (PUC) has struck down a prohibition against resale of electric service imposed by Toledo Edison Co. on owners and operators of commercial property. The PUC said that the case and other similar actions had begun as civil actions by landlords to collect back rent where disputes arose over the energy portion of monthly payments by tenants.

The Pennsylvania Public Utility Commission (PUC) has issued final regulations to guide the restructuring of intrastate transportation services offered by natural gas local distribution companies (LDCs) in the state. The PUC issued the new rules as a "tentative order" to allow additional comments from interested parties because of ongoing changes in the gas industry, and because over two years had passed since it issued proposed rules.

Sound bites from state and federal regulators.

Contel Merger. California removes stay on Contel/GTE merger. Orders equal sharing of short- and long-term economic benefits between ratepayers and shareholders. Fessler dissents, finding that the utility "had not established an entitlement to 50 percent of these savings." A.90-09-043, Decision 96-04-053, Apr. 10, 1996 (Cal.P.S.C.).

Local Telephone Resale. California requires two of the state's major LECs to offer a broad range of services for resale at wholesale rates.

Eleven members of the U.S. House of Representatives have written to Chair Elizabeth A. Moler asking the Federal Energy Regulatory Commission (FERC) to address competitive issues arising from the Public Utility Regulatory Policies Act (PURPA).

The Federal Energy Regulatory Commission (FERC) has refused to rehear or modify a June 15, 1995, rate order (Opinion 397) that denied Lakehead Pipe Line Partners, L.P. any income-tax allowance related to "curative allocations" under section 704(c) of the Internal Revenue Code that increase the general partner's taxable income beyond his or her proportion of company ownership.

The ruling (Opinion 397-A) affirms Lakehead's entitlement to a tax allowance based on the income attributable to corporate partners, but imposes a limit.

The Federal Energy Regulatory Commission's Donald F. Santa, Jr. looked beyond Order 888 electric restructuring when he addressed the second annual DOE/EPRI Executive Conference in Washington, DC, on May 21. According to Santa, the post-Order 888 electric agenda will be marked by three cross-cutting issues.

First, the FERC will grapple with market power in an open-access environment. While open access will mitigate the market power of transmission-owning utilities, the FERC needs to consider market power stemming from generation concentration.

In response to a request for comments on negotiated terms and conditions of service, the Columbia Gas Transmission Corp.

About 90 parties have filed petitions seeking changes to Order 888. Claiming "errors," the National Association of Regulatory Utility Commissioners (NARUC) asked the Federal Energy Regulatory Commission (FERC) to reverse its assertion of:

s Jurisdiction over unbundled retail transmission services

s "Primary" authority over retail stranded-cost recovery when retail consumers convert to wholesale

s "Backstop" authority to provide stranded-cost recovery when an end user changes power suppliers under a state-established retail wheeling system.

The Federal Energy Regulatory Commission (FERC) on May 29 found that a nonjurisdictional utility's voluntary open-access tariff, with certain modifications, would meet the electric transmission comparability standards established by Order 888. In the first case of its kind, the South Carolina Public Service Authority (SCPSA) has agreed to satisfy the reciprocity requirement that it offer nondiscriminatory transmission services to obtain open-access service from public utilities (Docket No. NJ96-1-000).

SCPSA submitted the open-access tariff before Order 888 came out.