The Business Case for Co-Op Acquisitions
IOUs considering co-op acquisitions are finding fertile territory for growth.
When do the pros of a co-op acquisition outweigh the cons? One feasibility analysis shows some surprising results.
Coal Gasification Gets Real
The technology works, but public policy will dictate its future.
The future of integrated gasification combined-cycle (IGCC) power plants depends on public support, but environmental and market factors are helping IGCC look like a winning technology for the future.
Reversing the Gas Crisis: The Methane Hydrate Solution
Commercialization of methane recovery from coastal deposits of methane hydrates could head off an impending gas shortage.
More than half of the Earth’s organic carbon is in the form of methane hydrates—also known as the ice that burns. U.S. potential is at least 100,000 Tcf., but commercial production has not been achieved.
IT Roundtable: The Digitized Grid
Data gathering and controllability offer the quickest path to reliability.
Technology leaders at Pacific Northwest National Laboratory, the Electric Power Research Institute, and the National Rural Telecommunications Cooperative present their visions of energy IT in the 21st century.
Backed By Wind
The need for additional generation to compensate for wind variations is disappearing.
Utility-based studies have laid to rest the concern that a wind plant needs to be backed up with an equal amount of dispatchable generation. Even at moderate penetrations, ancillary services to back up new wind power need not be more than is required of a system as a whole.
Changing Capital Structures for Changing Times
The utilities industry is in need of more equity.
Value Line projects that total capital for electric utilities will increase about 12 percent during the next several years, while common equity will increase nearly 28 percent. Similarly, natural gas distribution company total capital is projected to increase about 10 percent, and common equity close to 15 percent. For both industries, the median common equity ratio in the near-term future for companies with investment-grade rated subsidiaries is in the range of 51 to 52 percent. For utilities, higher equity ratios are desirable for several reasons.
PJM/Midwest Market: Two Rival Groups Battle Over Grid Pricing
Should transmission owners get paid extra for distance and voltage?
While the Midwest now appears set on competitive bidding for the electricity commodity, taking from PJM such tried-and-true elements as locational marginal pricing, financial transmission rights, and a day-ahead market with a security-constrained dispatch, the region remains split over the pricing of transmission.
Barriers to Entry: The Fight Against Power- Line Communications
And for a reasonable regulatory policy for new broadband technology.
To achieve the benefits of broadband over power line communications platforms, policy-makers must resolve a number of issues, including: (1) harmful radio interference; (2) access; and (3) cross-subsidies. If their policies impose diseconomies on the operation, design, or financial structure of BPL, widespread deployment of the technology is unlikely.
A Better Measure for Profitability
A new way to measure what matters most: how close a unit comes to meeting its total potential profit.
Approximately 65 percent of capacity additions in the last few years have been gas-fired, combined-cycle units. Recent market conditions have been hard on these new resources, which have suffered from significantly low capacity factors. A better metric would measure a unit's ability to capture peak prices while minimizing shoulder period and off-peak losses. Furthermore, it would measure the extent to which a unit dispatches according to favorable market conditions.
Letters to the Editor (December 2004)
While we are concerned about the effects of ratings linkage on regulated utilities, in no respect do we blame credit rating agencies. In fact, we strongly believe that the rating agencies are critical gatekeepers that point out for investors and regulators the potential linkages among holding company subsidiaries that could result in utility abuse or its credit downgrade.