The FERC's latest idea throws pipelines for a loop, with implications for power markets, too.
Transmission and distribution (em the business they call "pipes and wires" (em can't last much longer with rates set by cost of service. Contrary to the myth, these services deserve no special status due to their high embedded costs. They carry no intrinsic value apart from the electrons and molecules they deliver.
"THESE ARE THE DOG DAYS OF DEREGULATION." That's how Federal Energy Regulatory Commission chairman James Hoecker put it last month in Houston at his luncheon talk at the Sixth DOE/NARUC National Electricity Forum. He bemoaned the "evidence of delay" in restructuring that now "clearly exists."
Don't be fooled. What Hoecker has up his sleeve is nothing less than a full-scale overhaul of FERC Orders 888 and 889.
THE FEDERAL ENERGY REGULATORY COMMISSION met Aug. 14 in Chicago to address complaints filed concerning late-June electric price spikes in the Midwest, which saw prices climb a high as $7,000 per megawatt-hour.
Back in July, Commissioner James Hoecker had noted, "We need to know what led to the price spikes, and what ¼ this tells us about emergency market behaviors." He added: "We foresee a growing role for this commission in monitoring market performance."
But while the FERC debated, a shakeout loomed.
Debate at the Meeting
Charles E.
Business Wire
William Catacosinos has resigned as chairman of MarketSpan Corp., the utility formed to replace the troubled Long Island Lighting Co. Catacosinos is under investigation by the New York attorney general due to a $42-million severance payment as part of the buyout of LILCO by the New York government-run Long Island Power Authority (see Public Utilities Fortnightly, August 1998, p.28).
SCT Utility Systems Inc., signed a software and services agreement worth about $13 million with the city of Seattle for the BANNER Customer Management System.
THE SUMMER OF 1996 OPENED COOLER THAN normal in June and July, cutting electric sales. When prices for natural gas did not fall as expected, as a counterbalance Consolidated Edison Co. of New York entered a combined gas-conversion and weather-heading transaction with power marketer Aquila Energy, giving Con Ed some measure of protection against further revenue shortfalls in August.
THE PRICING TURMOIL THAT STRUCK MIDWEST POWER markets during the week of June 22, with allegations of price gouging and calls for a wholesale price cap imposed by the Federal Energy Regulatory Commission (see Docket EL98-53), made for good copy but has obscured what's really going on.
"In the pleadings to FERC, I saw no evidence of price gouging," says attorney Jeffrey Watkiss, who represents power marketers who have asked the Commission for wholesale market reform.
THE LAST FEW TIMES I'VE HIT THE ROAD FOR A INDUSTRY conference or speaking engagement, someone invariably has come up to tell me how my picture on this page seems to be getting younger. OK, I confess. Like many other columnists, I've probably carried on too long with the same old photo.