As it concluded its first review of an alternative rate plan for local telephone service, the New Jersey Board of Public Utilities approved a series of telecommunications network upgrades and associated network modernization program for Bell Atlantic-New Jersey.

The original rate plan, approved in 1993, had combined the promise of a modernized telephone infrastructure with rate deregulation for certain competitive services and a freeze on rates for residential phone service. (See, Re New Jersey Bell Tel.

The California Public Utilities Commission has valued sunk costs for the Diablo Canyon nuclear generating plant at $3.287 billion. The ruling forms the basis for future ratemaking treatment for the plant assets by its owner, Pacific Gas and Electric Co., according to industry restructuring under way in the state.

The approved rate plan includes an overall rate freeze and a bond-financed 10-percent rate reduction for residential and small commercial customers. Both are called for under the state's new electric industry restructuring law (Assembly Bill 1890).

Regulated customers of Portland General Electric Co. will receive compensation both for lost profits and for future, anticipated efficiencies under the final decision issued by the Oregon Public Utility Commission that approved the merger between PGE and Enron Corp.

Under the approved merger plan, Enron will absorb the utility's corporate parent, Portland General Corp.

As a result of negotiations between the merging companies and the commission's staff, Enron has agreed to guarantee "monetary compensation and benefits" to Oregon ratepayers in the amount of $141 million.

Overturning a utility commission ruling, the Pennsylvania Commonwealth Court has concluded that state law does not require an electric utility to prove that a planned transmission facility is needed from an engineering perspective to win a certificate of convenience authorizing construction.

The court overturned a ruling by the Pennsylvania Public Utility Commission that had denied an application by Pennsylvania Power and Light Co. to construct a 69-kilovolt transmission line.

The U.S. Court of Appeals for the District of Columbia Circuit has upheld a ruling by the Federal Energy Regulatory Commission requiring an interstate pipeline company to sell excess low-cost storage gas supplies to its sales customers at cost, on the theory that ratepayers who bear risk for losses in industry restructuring should retain gains from the same process.

The pipeline, Williston Basin Interstate Pipeline Co., had found that excess gas was available after it had cut sales operations as part of the market restructuring ordered by the FERC.

Sound bites from state and federal regulators.

Refusal to Wheel. Federal judge allows rural electric co-op to proceed with antitrust suit against PacifiCorp, ruling that doctrine of state action immunity does not insulate a regulated investor-owned electric utility from antitrust action for allegedly refusing to sell to sell power to others for resale to customers, or for allegedly refusing to wheel power generated by other suppliers.

The Nuclear Regulatory Commission staff has identified 13 nuclear plants that warrant increased NRC regulatory attention. These plants will remain on the NRC "watch list."

No additional nuclear plants were added to the NRC watch list. But one plant - Indian Point 3, operated by the New York Power Authority - was removed from the list. Indian Point 3 had been placed on the list in June 1993, and now has been removed due to improved performance.

At his first meeting as chair of the Federal Energy Regulatory Commission, James Hoecker announced that he was assigning responsibility for certain important issues to FERC members.

At the June 25 meeting, Hoecker assigned the key responsibility for reliability issues to Commissioner Vicky Bailey. Bailey will track reliability developments at NERC, DOE and around the nation. Hoecker assigned responsibility for merger policy issues to Commissioner William Massey. Commissioner Donald Santa Jr. and General Counsel Susan Tomasky were assigned the oversight of FERC's complaint procedures.

The Federal Energy Regulatory Commission on June 25 conditionally approved the restructuring of the New England Power Pool into an independent system operator, even though many of the details remain under negotiation.

The FERC also approved on an interim basis the transfer of control of NEPOOL public utility members' transmission facilities to the ISO on July 1 (Docket No. EC97-35-000).

To insure NEPOOL's independence, the FERC changed NEPOOL's definition of "affiliate," a relationship indicating 50-percent ownership, to one indicating 10-percent ownership.

A report from the Northeast-Midwest Institute has found that the Tennessee Valley Authority, Bonneville Power Administration, and the three other power marketing administrations must relinquish their preferential treatment and subsidies if consumers are to enjoy the rewards of electric competition.

Federal Power Dinosaurs - Reforming TVA and PMAs in a Competitive Electricity Environment said that as electric industry competition is introduced, lawmakers cannot ignore public or government-owned power companies.