Clean Air Act

has allowed Potomac Electric Power Co. rate recovery of costs associated with the development of electric vehicles for fleet use under alternate-fuel vehicle requirements imposed under the Energy Policy Act of 1992. The PSC rejected a request by the Greater Washington Petroleum Committee, an oil industry trade group, to deny funding because electric vehicle technology had not evolved to a point that promotes consumer acceptance of a competitively priced vehicle.

Electric utilities nationwide are attempting to retreat from commitments to energy efficiency (em a retreat that will benefit few customers, while damaging many. This retreat is driven by fear of retail wheeling (em that consumers will be able to shop for the lowest prices among competing entities. In turn, the threat of retail wheeling has spurred utilities to a frantic scramble to cut costs and trim rates.

Stephen P. ReynoldsPresident & CEO

Pacific Gas Transmission Co.

Two or three years ago, gas-fired generation was hailed as a cure-all for everything that ailed the natural gas industry.

PV technology combined with storage offers a cost-effective alternative to capacity additions.By John Byrne,

Young-Doo Wang,

Ralph Nigro, and

Steven E. Letendre

Until recently, both regulators and electric utilities have considered photovoltaic (PV) technology (i.e., solar cells) an unattractive

energy-supply option because of its relatively high cost. Now, however, a number of utilities have shown interest in using PV for peak-shaving.

This country's 350,000 manufacturers must add cutting-edge technologies to their processes to stay competitive. Yet most are small- to medium-sized companies leery of investing in new technology without first

confirming its effect on their

products.Some utilities previously had no option but to run local technology-demonstration facilities on their own (see sidebar on p.

federal-state tensions currently affecting energy regulatory policy in America.

Sen.

Forty percent of 42 state public utility commissions (PUCs) expect electric utilities to unbundle generation from transmission and distribution within the next one to five years, according to a survey conducted for the Electric Generation Association (EGA) by Boston Pacific Co.

The West Virginia Public Service Commission (PSC), on rehearing of an earlier rate order, has reduced the level of emissions control investment in rates for two electric operating subsidiaries of Allegheny Power System, Inc., Potomac Edison Co. and Monongahela Power Co. The PSC excluded one-half of the difference between amounts actually spent and those budgeted for emissions plant needed to comply with the Clean Air Act Amendments (CAAA), finding that the budget was nearly a year old and did not qualify as a "known and measurable" change in rate base.

The U.S. District Court for the Southern District of Indiana has declared portions of the Indiana Environmental Compliance Plans Act unconstitutional, striking down those sections that favor use of Indiana coal. The Act authorized Indiana to preapprove compliance plans files by electric utilities in response to the Clean Air Act Amendments of 1990 (CAAA), requiring the plans to favor coal mined in the state. The district court ruled that the Act violates the commerce clause, finding that the challenged portions sought to eliminate or limit use of western coal.

After Congress enacted the Clean Air Act Amendments of 1990, the electric utility industry focused considerable attention on what seemed the key provisions of the acid rain program: e.g., emission allowance trading. In contrast, the highly technical, seemingly innocuous continuous emission monitoring (CEM) provision received scant attention (em only a few engineers took notice. We now know that emission trading and other supposed key provisions had only a modest impact on utilities.