How will the industry change in the future?

The utility industry of the future can be best characterized by three words: scale, synergies, and automation. Company leaders and the broader workforce will be touched by these three forces for change. We can already see glimpses of the future around us today. In response to the sweep of deregulation, many power companies no longer generate power. They have divested themselves of their generating plants, ceding that ground to independent producers to concentrate on distribution.

Interviews

For Public Utilities Fortnightly's 75th Anniversary CEO issue, the magazine looked to the horizon and asked these new captains about the planned course for their companies, and for an entire industry.

Let's look back over the past few years-what we got right and where we went wrong.

Do you recall how you felt at your last class reunion? Well, that's exactly what an editor feels when asked to reminisce in public about days gone by at the magazine to which he gave his best years.

Georgia Power Co., Duke Power Co., and their customers have reaped the benefits of two-part real-time pricing (RTP) for nearly 10 years. This structure has been a perfectly acceptable and efficient means to price electricity, but a second structure for pricing electricity can now be introduced. Either structure is sound and efficacious. Each methodology has its advantages, and utilities should consider which method best serves their needs.

Business & Money

A spate of proposed U.S. tax rule changes soon may open a window of opportunity for certain utilities.

In the mid-1990s, before the rise of the Internet and the fall of Enron changed the calculus of business investing and the regulatory landscape, the historically staid U.S. utility industry began to be viewed as a "growth play." This triggered a global buying spree that led U.S. companies to invest tens of billions of dollars in electricity generation and distribution businesses all over the world.

Commission Watch

The commission's power grab over bankruptcy courts condemns merchants to a corporate netherworld.

Since we last visited the conflict between the Federal Energy Regulatory Commission (FERC) and bankruptcy courts over who decides whether a debtor can terminate unprofitable power contracts,¹ a new district court decision out of Texas has come down tilting the field in favor of FERC's assertion of exclusive authority.

Perspective

Why Ontario needs a competitive market.

For the past two years, the Ontario power sector has resembled a piñata at a children's birthday party, batted this way and that by the stick of public policy. Since the competitive wholesale market opened in 2002, the government twice has intervened to manage prices to final consumers.

Benchmarks

Unless gas prices stabilize, coal prices will continue rising.

Gas prices to power plants have surged in 2003, increasing more than 50 percent over their 2002 level. In absolute terms, this gas price in-crease exceeds $2/MMBtu-almost two thirds larger than average coal prices to power plants in 2003-and has rekindled interest in new coal-fired power plants. An increasing number of new coal-fired projects have been announced in the last 12 months.

Letters to the Editor

To the Editor:

The article "NERC's Cloudy Crystal Ball" () contends that the North American Electric Reliability Council (NERC) has consistently underestimated the growth in U.S. electricity demand. The only evidence offered for this conclusion is that observed data did not encircle the 45-degree line in a graph of actual vs. forecast percentage growth rates. Conjectures such as this are invalid for numerous reasons.

People

New Positions:

Southern Co. appointed Chris Hobson senior vice president of environmental affairs, reporting to Charles Goodman, the company's newly named senior vice president of environmental policy and research. Hobson currently serves as vice president of environmental affairs for Southern Co. subsidiary Georgia Power.